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Protecting investments in Lebanon
Posted on: 4/5/2007 11:29:00 AM

Some, particularly in the Arab countries, live by the motto that 'capital is coward'.

 

I had this depiction in mind upon reading statements recently made by UAE investor Khalaf Al Habtoor in Beirut, in which he let out a scream of pain and warning that the situation in Lebanon has hit rock bottom and that it has become difficult to predict the outcome of the current economic conditions and investment atmosphere.

 

As a matter of fact, I did not sense any cowardice in Habtoor's statements, and even wished that similar calls would be made by hundreds, or indeed, thousands of Lebanese investors who put their trust in this small country and contributed, in many ways, to weaving a dream they held for long periods of expatriation, which soon evaporated as a result of the conflicting interests of political rivals.

 

Eight years ago, the term 'coward' had no place in the feasibility study I laid down to act as the core for a consulting agency operating in the field of public relations.

 

Back then, the move earned me other epithets such as 'impulsive', 'careless', or even 'insane', for choosing Beirut as the company's regional headquarters instead of Dubai, the preferred and 'obvious' choice for a large number of public relations firms.

 

My answer to those who questioned the soundness of my decision was that an investor must not consider the current situation in the market he plans to invest in, but to have the courage and the vision that would enable him to run his investment in a way that yields benefits to the country they opted to invest in and enables him to fulfill his dream.

 

Unfortunately, many of these expectations turned out to be correct. Any one opting to invest in Lebanon must be prepared to bear the consequences of their decision.

 

The general atmosphere, and, to a certain extent, the State policy and its outcomes evoke pessimism for being founded on haphazardness and indifference to a future in which many of those who ventured to invest predicted would rise to a rank of regional competitiveness with the top players.

 

This is how some of us had based our feasibility studies, but overlooked the 'risk analysis', given the fact that we live in a market marred by many internal and external risks.

 

The essence of the Lebanese predicament is primarily political, in contrast to the well-established norms in all countries.

 

Throughout the history of the Lebanese Republic, politicians placed their interests above any other interests in stark contrast to neighboring or even geographically distant countries that employ politics to achieve the objective of immunizing the domestic situation by creating a positive atmosphere yielding economic development.

 

Politics for the sake of politics, however, becomes an absurdity that might play a role in breathing life into the 'economy' or the personal fortune of those politicians.

 

But what about the homeland?! Yes, the homeland; composed of groups of citizens who have grown to suffer some sort of an unmatched material bankruptcy and an unprecedented emigration of minds and capital.

 

The worrisome aspect of the current Lebanese situation lies in the fact that capitalists, particularly Arab capitalists, would like to invest in the local market, but the degree of risks is set to outstrip the 'lovely climate' and the creative service long touted by the Lebanese to attract Arab investors.

 

What climate are we talking about here? Is the mere notion that skiing in Faraya and swimming in Jbeil during the course of the same day are enough to attract tourists and investors?

 

Certainly not, the answer may be seen in the following story: we were approached by an international real estate company after the Israeli war ended last summer to lay down a public relations strategy and reach an understanding with respect to a project worth hundreds of millions of dollars that the company planned to set up in Lebanon.

 

In addition to the economic objective, those in charge of the project sought to convey a message of support to Lebanon, especially in the aftermath of the war, the essence of which was: 'we are with you and we stand by you'.

 

A month after the meeting, when contacts were lost with that company, I inquired about the project only to be clearly told that the project was shelved for the following well-founded reason: in the confrontation with Israel the adversary was known, allowing our Arab and brotherly friends to take the supportive stance to Lebanon and its people, while in the thicket of the internal political turmoil, it would be impossible to side with one against another.

 

This is how Lebanese politicians wasted a one-time opportunity, and one can be certain that similar examples of projects that opted for neighboring countries like Jordan, Syria and Egypt exist, especially since we live at a time that is characterized by a multitude of investment portfolios spurred by the oil boom, and the investors' constant and multi-faceted search for promising, yet stable markets.

 

According to the science of politics and economics, both fields work together for the benefit of the homeland, while the situation in Lebanon is such that all sciences seem to shatter on the rock of sectarian and class conflicts and special interests.

 

Therefore, the Lebanese must call for a separation between economy and politics by the State, so long as politics in Lebanon inherently rely on bickering and standoffs, there will always be a risk of total economic collapse.

 

They must also demand the setting up of a committee of economic specialists and representatives from the various Lebanese sectors, as well as representatives from friendly countries, to tackle the economic crisis.

 

The aims of this group can be summarized as laying down a serious, long-term strategy aimed at reviving the economy, and conferring with representatives from friendly countries on means of restoring foreign investors' confidence in order to go ahead with their investments, as well as setting forth an integrated public relations plan to promote the image of Lebanon as a regional hub at which Arab and international firms line up, not just for the beauty of its nature, but also for the available skilled and educated workforce, and the facility of restriction-free investments.

 

Will the investors find these conditions in light of the current unfortunate Lebanese situation? Certainly not, as anyone with the most rudimentary economic experience can foretell an eminent disaster that could strike Lebanon unless it seeks to achieve the separation of economy from politics and the pursuit of laying down a serious plan. (Lebanonwire.com)



 

2007 Presidency of the Council of Ministers. All Rights Reserved.
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