Investment Development Authority of Lebanon€¦ · KSA FDI Inflows to MENA Region (2010) (in USD billions) One of the Largest Recipients of FDI in the Region

Investment Development Authority of Lebanon

Arab Spanish

Investment Forum 2011

Wednesday October 26th

1. ABOUT LEBANON

2. CURRENT TRENDS IN SPANISH – LEBANESE TRADE

4. INVESTMENT OPPORTUNITIES IN LEBANON

3. SPANISH COMPANIES AND LEBANON

5. HOW IDAL CAN HELP

Headlines

6. CONTACT US

1. ABOUT LEBANON





6. CONTACT US

1

2

3

4

5

6

7

8

9

10

Strategic Location

Free market economy

Liberal Financial Environment

Banking Secrecy

Favorable Taxation & Fiscal Incentives

Non-Discriminatory Legal Framework

Competent Human Capital & Low Labor Cost

Quality Health Care & High Education

Rich History & Culture

High Quality of Life

An Attractive Business Location With Easy Access To The MENA Region…

10%

13%

15%

15%

17%

20%

20%

24%

25%

30%

30%

33%

33%

40%

45%

Cyprus

Ireland

Jorda…

Egypt

Turkey

Greece

UK

Tunisia

Jorda…

France

Japan

Syria …

Corporate Tax Rate (%)

(2009)

Having One of the Lowest Corporate Tax Rates in the World…

Source: Countries website

And One of the SoundestBanking Systems in the World…

Source: Global Competitiveness Report (2010-11)

1st

2nd

3rd

4th

5th

6th

7th

8th

9th

Ran

k

Soundness of Banks

(World Ranking, 2010)

Source: International Monetary Fund, World Economic Outlook Database, April 2010

0.6

7.5

9.3

8.57.58.2

8.7

6.0

2.5

7.35.8

6.0

5.0

2.0

3.8

3.02.7

0.2

-3.2

3.0

-4

-2

0

2

4

6

8

10

2006 2007 2008 2009 2010

Lebanon Emerging & Developing Economies Middle East North Africa Advanced Economies

Worldwide Financial Crisis

Registering a Stellar Economic Performance Amidst the Turbulence…

Real GDP Growth Rates (2006 -2010)

(in %)

2.68

3.38

4.3

4.8 4.94

2006 2007 2008 2009 2010

CAGR 15%

FDI Inflow to Lebanon (2006-2010)

(in USD billions)

Source: UNCTAD

Recording ContinuousPositive Investment Trends…

Source: UNCTAD / World Investment Report (WIR) 2010

0.1

1.3

1.3

1.7

2.2

4.8

4.9

5.5

6.3

28.1

Kuwait

Syria

Morocco

Jordan

Algeria

UAE

Lebanon

Qatar

Egypt

KSA

FDI Inflows to MENA Region (2010)

(in USD billions)

One of the Largest Recipients of FDI in the Region…

80

57

57

55

52.6

41.3

40.4

39.8

35.2

32.7

20.6

Lebanon

Jordan

Tunisia

Qatar

Morocco

UAE

Kuwait

Egypt

Bahrain

Saudi …

Algeria

Education Capability IndexSelected Regional countries

(2010)

Representing CEO satisfaction based on:

* current quality of educational system* adequate skills acquired by students upon graduating * ability of system to meet future market requirements

Source: PWC; EducationDev

Number of Higher Education Students per 10,000 Inhabitants

(2010)

5339

4974

3117

2712

1960

1900

1559

1509

1380

1253

1236

801

USA

Korea

Argentina

Lebanon

Turkey

Egypt

Syria

Qatar

Saudi …

Tunisia

Algeria

UAE

And Having One of the BestEducated Workforce in the Region

http://www.pwc.com/htttp://www.educationdev.net/

1. ABOUT LEBANON





6. CONTACT US

Lebanon Has Enforced Numerous Bilateral Trade Agreements…

52 agreements for the Promotion and Protection of Investments

Source: Ministry of Finance

Including one with the Kingdom of SpainEnforced as Law N. 632 In O.G N.21 of May 8, 1997

32 conventions for the Avoidance of Double Taxation and the Prevention of Fiscal Evasion on Taxes from Income and Capital

Multilateral investment-related agreements with:

>> European Free Trade Association (EFTA) >> Euro-Mediterranean Partnership >> Greater Arab Free Trade Area (GAFTA) >> Gulf Cooperation Council >> Multilateral Investment Guarantee Agency (World Bank Group) >> United Nations Commission on International Trade Law

Lebanon is a member of

multiple international organizations

and has applied for WTO membership

And Spain is a Privileged Trade Partner of Lebanon…

Spain Trade Balance with Lebanon

(in USD millions, 2011)

0

10

20

30

40

50

60

Imports from Lebanon

Exports to Lebanon

Source: SpainBusiness

With the hope of recording increased

Spanish imports from Lebanon

With a Diverse Range of Sector Products Being Traded Between Both Countries

Spanish Exports to Lebanon

Fashion 39.7 million USD

Environment and energy

27.6 million USD

Industrial technology

23.6 million USD

Chemical industry 19.8 million USD

Animal products 16.1 million USD

Spanish Imports from Lebanon

Chemical products 13.5 million USD

Raw materials 8.5 million USD

Construction industry

1.3 million USD

Industrial technology

0.87 million

Fashion 0.84 million

Source: SpainBusiness

1. ABOUT LEBANON





6. CONTACT US

Spanish Commercial Activity with LebanonFeatures the Following Companies:

CONSTRUCTION / TRANSPORT

HEALTH EQUIPMENT

FINANCEBEAUTY PRODUCTS

AGRO INDUSTRY

Famous Spanish Brands Available in the Lebanese Market Include:

1. ABOUT LEBANON





6. CONTACT US

INDUSTRY

MEDIA

TELECOM TOURISM Sectors included

in Investment Law No.360 (*)

(*) Sectors selected for their growth potential and their readiness for development

AGRICULTURE

IT TECHNOLOGY

Economic Sectors with Growth Potential

AGRO INDUSTRY

http://www.stockfreeimages.com/2190499/Grow.htmlhttp://www.google.com.lb/imgres?imgurl=http://studentlife.unlv.edu/technology/images/technology.jpg&imgrefurl=http://studentlife.unlv.edu/technology/&usg=__Yc7tkLUP6-T_ZDfR8IGLzC9iAX8=&h=533&w=800&sz=668&hl=en&start=9&zoom=1&itbs=1&tbnid=WctB9O4hDDD7LM:&tbnh=95&tbnw=143&prev=/search?q=technology&hl=en&sa=G&biw=1419&bih=715&gbv=2&tbm=isch&ei=503fTdLaKMGq-gaMpPjDDQ

Industry

Machinery and EquipmentRubber, Plastics, Non- Metallic Mineral Products and Metals

Chemicals & Pharmaceuticals Furniture, Textiles and Paper Products

Agro Industry

Manufacturing PlantsBottling Facilities

Investment Opportunities

Information Technology

Software and HardwareInternet Software Providers

Telecommunication

Agriculture

Packaging CentersProduction Facilities

http://www.stockfreeimages.com/2190499/Grow.html

Technology

ElectronicsHigh Tech Manufacturing and Semi Conductors

Software for Telecom Equipment

Telecommunication

Hardware EquipmentSoftware

Media

AdvertisingTV ProductionDigital Media

Production Houses

Investment Opportunities

Tourism

Hotels and Leisure Facilities Healthcare Tourism

Cultural and Religious TourismBusiness Conferences

http://www.google.com.lb/imgres?imgurl=http://studentlife.unlv.edu/technology/images/technology.jpg&imgrefurl=http://studentlife.unlv.edu/technology/&usg=__Yc7tkLUP6-T_ZDfR8IGLzC9iAX8=&h=533&w=800&sz=668&hl=en&start=9&zoom=1&itbs=1&tbnid=WctB9O4hDDD7LM:&tbnh=95&tbnw=143&prev=/search?q=technology&hl=en&sa=G&biw=1419&bih=715&gbv=2&tbm=isch&ei=503fTdLaKMGq-gaMpPjDDQ

POTENTIAL INVESTMENTS IN:

Manufacturing plantsBottling facilities

Sources: Syndicate of Agro Food Sector // Central Administration of Statistics

A major contributor to the Lebanese economy

Generated around 32.5% of the industrial sector output in 2009

Has significant employment potential with 23.3% of the industrial sector workforce (30,760 workers)

Accounts for 20% of industrial establishments in Lebanon

Exports of agro-food products equal to 10.9% of total industrial exports

Exports growth at 13% annually since 2001 (despite decline in industrial sector exports)

Agro Industry: Important Export Potential


SoftwareHardware

Internet Software ProvidersTelecommunication

Source: Business Monitor International

Estimated size: 287 million USD (2010)

Forecasted to grow by around 11.8%(based on estimates)

Employs around 7,000 people

Over 20% of Lebanese companies are involved in the IT sector (either in hardware, software or as internet service providers)

Mobile penetration rates are in fact among the highest in the region and have totaled 68% by end of 2010

Big potential in business-related applications and web development as well as software development

ICT: Sizeable Potential In Business Applications


AdvertisingTV ProductionDigital Media

Production Houses

Home to one of the most significant media industries in the Middle East

Advertising expenditure is expected to record growth rates of 8.4% over the next 3 years

Total advertising expenditure constitutes 2.8% of the national GDP

New opportunities in digital media including:

• Online Advertising (e.g. Yahoo buying Maktoob)

• Online Gaming• Online Advertising• Specialized 3D Animation

Media: A New Growing Market


Hotels and Leisure FacilitiesHealthcare Tourism

Cultural and Religious TourismBusiness Conferences

Directly accounts for 8% of Lebanese GDP but indirectly to around 34% of the national GDP (because of the indirect effect on the economy)

Capital investments in this sector have amounted to 1.2 billion USD in 2010 (10.2% of total investments) and are expected to rise by 6.2% per annum according to the WTTC (*)

7 billion USD of revenues generated by tourism (20% of country’s GDP)

40% growth in tourists arrival

(*) WTTC: World Travel & Tourism Council

Tourism: Highest Generator of Revenues

1. ABOUT LEBANON





6. CONTACT US

• The National Investment Promotion Agency of Lebanon

• History – Established in 1994 with the aim of promoting Lebanon as a key investment destination and attracting, facilitating &retaining investments in the country

• Governance – IDAL reports to the Presidency of the Council of Ministers (which exercises a tutorial authority over it) and has financial and administrative autonomy

• Legislature – Investment Law No. 360 was enacted in 2001 to regulate investment activities in Lebanon

About IDAL

THE INVESTMENT DEVELOPMENT AUTHORITY OF LEBANON(IDAL)

IDAL serves as a consultant to the investing company with expertise provided on both the local and regional markets

INVESTOR(National & Foreign)

Consultancy Services:

• Provision of market intelligence (by sector and topic)

• Introduction to potential partners and suppliers

• Advising on the financing of the project (including incentives)

• Assistance in applying for incentives

• Assistance in coordinating with licensing authorities to facilitate the issuance of licenses and permits (to set-up and operate a business)

Market Intelligence

Facilitates issuance of procedures

Business Matchmaking

Our Consultancy Services

EXPORT PROMOTIONINVESTMENT PROMOTION

• Actively promote Lebanon to foreign investors

• Provide economic, commercial and legal information of relevance to investors

• Identify business opportunities across various economic sectors

• Grant fiscal exemptions and fees reduction to investment projects

• Facilitate issuance of permits and licenses

• Provide on-going support for investment projects

• Provide data on external markets

• Support companies in selected sectors in accessing external markets

• Provide promotional materials

• Subsidize participation in foreign fairs

• Two export promotion programs:

Export Plus (2001): providing subsidies to exporters of agricultural products

Agro Map (2004): subsidizing the participation of agro food companies in foreign fairs

1 2

Our Two Mandates

JOB CREATION & SECTOR BASED INCENTIVES

REGION & SECTOR BASED INCENTIVES

1 2

Also called Investment Project by Zone (IPZ) incentives

Incentives granted to projects which meet the following criteria:

(1) Sector(2) Investment size(3) Geographical location across

three zones: A, B, C

Also called Package Deal Contract (PDC) incentives

A contract between the investor and the Lebanese Government, represented by IDAL, whereby an investor is granted incentives, exemptions and reduction when meeting the following criteria:

(1) Sector (2) Investment size (3) Number of jobs created

Our Incentives

AB

C

C

SectorsMinimum Inv. Size

US$

Tourism 10,000,000

Industry 5,000,000

Agro-Industry 2,000,000

Agriculture 1,500,000

Technology, ICT & Media

200,000

Sectors Minimum Inv. Size US$

Tourism 4,000,000

Industry 3,000,000


Agriculture 1,000,000

Technology, ICT & Media 200,000

SectorsMinimum Inv. Size

US$

Tourism 1,000,000

Industry 1,000,000


Agriculture 500,000

Technology, ICT & Media

200,000

ZONE C

100% income tax exemption for 10 years

Work permits granted

ZONE A

100% income tax exemption for 2 years (*)


Beirut

ZONE B

50% income tax exemption for 5 years


+

+

(*) Provided that 40% of stocks are listed on the Beirut Stock Exchange

+

Region & Sector-Based Incentives1

Sectors Minimum Inv. Size US$

Minimum Job Created

Tourism 15,000,000 200

Industry 10,000,000 100

Agro-Industry 3,000,000 60

Agriculture 2,000,000 50

Technology, ICT and Media

400,000 25

100% Exemption on Income Tax for up to 10 years

100% Exemption on Taxes on Project Dividends for up to 10 years

ZERO Land Registration Fees

Up to 50% Reduction on Work & Residence Permits

Up to 50% Reduction on Construction Permit Fees

Obtaining Work Permits of all categories

+

+

+

+

+

Job Creation & Sector-Based Incentives2

Source: IDAL

Major Investments Mediated by IDAL

1. ABOUT LEBANON





6. CONTACT US

Lazarieh Tower - 4th Floor - Emir Bechir StreetRiad El Solh - P.O.Box 113-7251 Beirut - LEBANON

T + 961 (1) 983306/7/8 F + 961 (1) 983302/3E [email protected] http://www.idal.com.lb

@Invest_Lebanon

The Investment Development Authority of Lebanon

LOOKING FORWARD TO HEAR FROM YOU SOON

Documents

Investment Development Authority of Lebanon€¦ · KSA FDI Inflows to MENA Region (2010) (in USD billions) One of the Largest Recipients of FDI in the Region