Exports drop in Lebanon
Lebanon's industrial exports fell 11.3 percent in the first nine months of 2012 compared to same period in 2011, an Industry Ministry report showed Wednesday, but the minister remained hopeful that exports will rebound, after reasonable performance in September.
Industrial exports in September 2012 "are nearly the same as those achieved in September 2011. This calls for optimism but to remain watchful until we make sure that exports are returning to normal path," Industry Minister Vrej Sabounjian said in a statement.
The minister said a draft law cutting industrial export profits tax by 50 percent paves the way for a rebound, once passed by Parliament.
"The law has been sent to Parliament and we expect it to be passed in a general session soon. Taxes will drop from 15 percent to just 7.5 percent, the lowest in the world,"he said.
"This will reflect very positively on economy ... and encourage local and foreign investors to invest in productive projects," he added.
Industrialist Charles Arbid, head of the Lebanese Franchise Association, told The Daily Star that increasing production costs, local and regional instability "“ particularly the situation in Syria "are behind the sharp decline in exports.
"Instability in Lebanon renders importers of our goods reluctant to proceed with importing our goods," he said, arguing importers prefer to source goods from countries where producers can guarantee delivery on time and a continuity of supply.
But Arbid echoed Sabounjian"s views, adding he remained confident in the sector'as ability to rebound despite the turbulent domestic and regional situation.
"The Lebanese industrial sector is fully capable and has the capacity to grow and expand," he said. "But industrialists should be aware of the tougher conditions and [put more emphasis] on increasing quality and competitiveness," he added.
This is particularly relevant given that industrialists have to look for foreign markets as local demands plummet on weaker economy.
In September 2012, Lebanon exported nearly $253 million, 3.8 percent lower than in September 2011.
Metal products topped September's exports with over $46 million of the country's exports. Electric equipment and appliances came second with $37 million, followed by foodstuff worth nearly $32 million.
Arab countries grabbed 53.4 percent of total exports in September, followed by the European Union with 16.2 percent and Asian countries 12.5 percent.
Lebanon's exports have fallen after security deteriorated on routes through Syria, more than doubling shipping and insurance costs, according to experts.
Total exports, including industrial and agricultural goods, fell more than 4 percent to reach $4 billion in the first nine months of 2012, according to the Lebanese Customs Department.
- From escaping to winning: the story of the Lebanese who are 'making it big' in Brazil
- A will with no way: Egypt's charitable spirit dampened with economic hardship
- OPEC exports largest share of petroleum to Asian and Pacific countries in 2013
- High demand for gold spurs trade across GCC
- Is trust the only missing ingredient from Egypt's economic reform recipe?