Border closures harm Lebanese exporters

Published March 31st, 2013 - 11:16 GMT
Closed Borders and Shrinking Markets For Exporters
Closed Borders and Shrinking Markets For Exporters

In the past, the biggest problems faced by Lebanese manufacturers and agricultural producers were related to high production costs. Now, their very survival could hinge on securing export routes, keeping transportation costs down, and ensuring they do not lose existing foreign markets.

Since the outbreak of the Syria crisis in March 2011, Lebanese exporters’ sole means of transporting their goods and produce overland has been jeopardized. The repeated closure of the Syrian-Lebanese and Syrian-Jordanian borders has not been conducive to regular trade.

Lebanese goods must transit Syria and then go through Jordan or Iraq to reach the Gulf and Egypt. In 2012, these countries absorbed 36 percent of Lebanon’s $4,483 million worth of exports. All told, there has been a 6 percent reduction in overland exports in 2012.

Of exports to these countries, 52 percent are transported overland. Therefore, any hindrance to these routes “turns our access route to the Gulf states into a minefield,” said Georges Nasrawi, head of the Food Industries Association.

This isn’t the first blow to Lebanese exporters. In 2012, Lebanese manufacturers were notified by Dubai that their goods would be barred if they were priced higher than previously quoted. In the future, if an exporter wants to raise their price, they would have to submit proof that their production costs had risen.

In addition to this measure, the US and Europe have tightened the squeeze on Lebanese exports by increasing the number of compliance rules that allow access to their markets.

The only alternative available to exporters has been to seek out non-overland export routes, which, even when usable, costs double the pre-crisis days.

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