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Wed 13 Nov 2019 02:00 PM

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Lebanon is open for business, says new IDAL chairman Mazen Souied

Souied says troubled country has plenty to offer through thriving entrepreneur sector

Lebanon is open for business, says new IDAL chairman Mazen Souied

The newly appointed chairman of the Investment Development Authority Lebanon (IDAL) has declared the troubled country open for business.

Dr Mazen Souied, an economist and former advisor to the ex-Lebanese prime minister Saad Hariri, who resigned last month following angry demonstrations, said the country remains a hotbed for entrepreneurs, despite ongoing protests.

Speaking during a panel session at the Arab Businessmen and Investors Conference (ABIC) in Bahrain, Souied said Lebanon was suffering from obvious political instability, a macro-economic crisis - its debt-to-GDP ratio has been stuck above 150 percent for two decades - and a currency restricted by its peg to the dollar.

And he admitted this didn’t bode well when trying to attract investment for start-ups.

However, he stressed that there was plenty to be positive about.

When asked how you sell the country to potential investors, he said: “You can sell human resources, Lebanese talent, Lebanese entrepreneurship. Lebanon is potentially an outsourcing hub for tech companies and there are several success stories.

“Unbelievable you know. Entrepreneurs in Lebanon operating out of the basement of their own houses and manufacturing semi-conductors and selling them to Facebook and Google and to top tech companies.

“For those that open an outsourcing company in Lebanon and hire engineers and software engineers and graphic designers that cost you significantly less than what they cost you in India and China, we’re not even talking about Europe or the US.

“This is a very good business proposition I think because you are developing products to be sold abroad.”

Banks and schools were closed in Lebanon on Tuesday as protesters tried to prevent employees from clocking in at state institutions nearly one month into an anti-graft street movement.

Unprecedented protests erupted across Lebanon on October 17, demanding the ouster of a generation of politicians seen by demonstrators as inefficient and corrupt.

The government stepped down on October 29 but it remains in a caretaker capacity as no overt efforts have been made to form a new one.

The leaderless protest movement first erupted after a proposed tax on calls via free phone applications, but it has since morphed into an unprecedented cross-sectarian outcry against everything from perceived state corruption to rampant electricity cuts.

People in the street say they are fed up with the same political families dominating government institutions since the end of the 1975-1990 civil war.

Protesters are demanding a fresh cabinet include independent experts not affiliated to traditional political parties, but no date has yet been set for required parliamentary consultations.

Government formation typically takes months in Lebanon, with protracted debate on how to best maintain a fragile balance between religious communities.

The World Bank says around a third of Lebanese live in poverty, and has warned the country's struggling economy could further deteriorate if a new cabinet is not formed rapidly.

The theme of this year’s ABIC event in Manama was around the fourth industrial revolution.

Souied said: “Lebanon is going through a kind of 4.0 revolution itself. This is not a revolution about politics, this is not a revolution about social inclusion, this is not even a revolution about economic empowerment. This is a revolution about messing up with the social media generation. A revolution that started with a 20 cent tax on WhatsApp and triggered basically, amazing outrage that started amongst the youth and then spread and now, the biggest demand of the revolution, is about corruption, access to data, access to information and it’s about getting back the money people think was mismanaged or spent in the wrong places.”

He added: “I think there is a recognition among the political class and every single leader in Lebanon has come up and said that these revolution demands are legitimate.”

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