Invest in Lebanon
Lebanon’s strategic geographical location has been recognised for centuries as a contact point between the east and west and as the gateway to the Middle Eastern market. Home to 1.2 million high-skilled labour force with access to a regional market of 106 million consumers; Lebanon offers plenty of advantages for potential investors planning to set up and to develop new business in the Region.
Economically, investing in Lebanon is a sound decision, financially, it is a fulfilling endeavorand socially it is a rewarding venture.
A SOUND DECISION
Lebanon, with its official non-interventionist stance toward private investments, offers one of the most liberal investment climates in the Middle East. The economic openness of the country is harnessed through the absence of legal restrictions on the entry or exit of firms, encouraging free market competition and furthering the development of the private sector. Liberal trade and investment policies have allowed foreign direct investments to account for a considerable share of Lebanese GDP. Lebanon has also one of the lowest taxation schemes and fiscal charges in the world, with only a 15% corporate tax rate.
Furthermore, the Lebanese legal framework protects private ownership and grants both Lebanese nationals and foreign investors equal incentives and rights.
In fact, many foreign companies have chosen Lebanon as the place to set up their businesses to cater to the region, such as; Microsoft, Packard Bell, Deutsche Post, Zurich Financial Services, and many more. They cover a wide range of sectors from manufacturing, sales and marketing, ICT, Tourism, Financial
Services, Agriculture, Agro-Industry, and Media.
A FULFILLING ENDEAVOR
In addition to all the facilities that make Lebanon an interesting market to investors, the country has been critical in managing risks, averting the negative repercussions of the last global economic downturn; the sturdy, highly liquid and historically confidential Lebanese banking sector constitutes a solid backbone to the Lebanese economy. The Lebanese banking industry is financially sound and stable. It ranked fourth worldwide in 2010 in terms of soundness of bank rankings, following Canada, New Zealand, and Australia. It plays a key role in the Lebanese economy where banks continue to dominate the financial system of the country and are major providers of credit to individuals and businesses. The country is also recognized for its multi-skilled workforce and a high entrepreneurial drive among its citizens. The percentage of employed people holding university degrees is among the highest in the region and the world at 43%.
A REWARDING VENTURE
In Lebanon you can enjoy the most hospitable MENA destination for business, culture and leisure with a Mediterranean climate, cosmopolitan lifestyle and a variety of tourist attractions and activities across breath-taking natural landscapes. Lebanon also boasts state-of-the-art health care services, internationally renowned for the quality of medical centers and staff. A historic melting pot for multiple civilizations, Lebanon is a small, multilingual haven of culture and diversity. In fact, Lebanon ranked 3rd out of 19 countries in the MENA region in terms of leisure and lifestyle spending.
LEADING STRATEGIC SECTORS
Lebanon has excellent opportunities to develop business initiatives in both traditional and non-traditional sectors.
The industry is a major contributor to the Lebanese economy, it accounted for around 2.5% of the Lebanese national output . There are around 400 companies working in this sector, with some local companies serving the MENA region from Beirut. In fact, a lot of those local companies are ranked amongst the top production houses in the region. The most promising investment opportunities within the Media industry exist in the field of Television Broadcasting, Advertising, Production and Post-Production, Digital Media, and Publishing. The convergence between the Media and Telecom sectors has opened new horizons in the field of digital media in Lebanon, with opportunities arising in the following: Content creation in Arabic, Online Gaming, Online Advertising, and Specialized 3D animation. Television broadcasting continues to be the primary source of entertainment revenues and also offers opportunities especially in content creation for local TV’s and post Production services, including dubbing and subtitling.
The sector’s position in the Lebanese economy is developing rapidly and is expected to grow at an average annual rate of 7% for the coming 3 years, fuelled by a very talented human capital base. Over 20% of companies operating in Lebanon are involved in the information, communication and technology sector spanning from software and design development, to manufacturing of ICT components and the development of data centres. Lebanese businesses are involved in an array of fields, most notably the development of advanced web applications, the creation of multimedia products, and the supply of management information systems. Most firms have developed software products catering for specific areas mainly: banking, insurance, and healthcare, in addition to the installation and customization of software in line with clients’ specific needs. The market has recently witnessed the surge of firms specialized in mobile applications which are now being exported to regional and international markets. Many success stories of Lebanese companies have been noted to date and Lebanon has the potential to turn into a major regional hub for software development.
The agro-industrial sector is a major contributor to the Lebanese economy. It generated an estimated 32.5% of the industrial sector output and around 2.54% of the country’s GDP based on 2009 estimates. Agro-food enterprises account for the largest share of industrial establishments in Lebanon, with 20% of enterprises, or some 4,700 companies, involved in agro-industrial activities by 2009. Exports of agro-food products account for 10.9% of total industrial exports, and have been growing at an average steady rate of 13% annually since 2001. They have continued to grow steadily despite the general decline in industrial export growth in 2009, demonstrating the sector’s potential and resilience. Key exported agro-food products include processed foods, confectionary and chocolate, as well as grains, cereals, olive oil, and wine. Lebanese brands enjoy a very high penetration in foreign markets due to the exceptional quality of our products.
COMMITMENT AND SUPPORT TO INVESTORS
The Government of Lebanon, through the Investment Development Authority of Lebanon (IDAL), provides extensive support for investors interested to set up, maintain, or expand their activities in the country. IDAL offers local and foreign investors alike with a range of incentives and business support services across a set of priority sectors that showed the most promising opportunities in terms of their investment potential and impact on socio-economic growth, they include: Industry, Agriculture, Agro-Industry, Tourism, Information Technology, Technology, Telecommunication, and Media. In addition to its role as investment promotion agency, IDAL is entrusted with the active promotion and marketing of Lebanese exports including but not limited to agricultural and agro-industrial products.
How we can help you:
- We provide economic, commercial, legal, industrial and other information relevant to your investment decisions.
- We identify for you investment opportunities in various growth promising sectors.
- Mediate contacts between investors and entrepreneurs to identify potential joint-venture opportunities.
- Provide information on economic sectors with investment potential.
- We Grant various types of fiscal exemptions and fees reduction to your investment projects
- Participate in the capital of joint-stock companies in specific fields.
- Facilitate the issuance of permits and licenses required for starting and operating a business through coordinating with corresponding public institutions.
- Provide advice on project location, financing means and joint venture opportunities
- Arrange for business meetings with officials from both private and public sectors.
- Provide you with after-care service for your investment projects.
As previously mentioned, IDAL grants a set of incentives for investments. These fall under two schemes:
Investment Project by Zone (IPZ) scheme: A scheme mostly catered for SME projects and is designed to provide the highest support to projects located. As such the criteria used to determine a project’s eligibility for this zone include: the project’s geographical location, investment size and sector type. Through this scheme, an investor receives fiscal related incentives that could go up to 100% exemption from corporate income tax for a 10 year period as well as labor related incentives with the immediate issuance of work permits.
Package Deal Contract (PDC) scheme: A scheme mostly catered for large scale projects, or projects which have a high impact on employment. The criteria used to determine a project’s eligibility for this scheme include the project’s investment size, number of jobs created, and sector type. This scheme provides a broader range of incentives and include fiscal and labor related incentives as well as set-up fees reductions that could go as far as Zero fees on land registration and 50% reduction on work on residence permit fees. Under this scheme, the investor is bound by a contract with the Lebanese government represented by IDAL.
If you are planning to set up your business in Lebanon and the Middle East, we welcome you to contact us so that we can provide you with the advice and assistance needed .
Riad El Solh, Emir Bachir Street, Lazarieh Tower
4th Floor, PO. Box: 113-7251
T +961 1 983306 F +961 1 983302
Follow us on Twitter: @Invest_Lebanon