Lebanon's economy to grow by 2 pct this year: Salameh

Central Bank Governor Riad Salameh speaks during a conference in Beirut, Thursday, May 10, 2012. (The Daily Star/Mohammad Azakir)

BEIRUT: Lebanon's economy is expected to grow by 2 percent this year, central bank chief Riad Salameh said on Friday.

He also said Lebanese banks based in Syria have lost $400 million since the unrest erupted in Lebanon's neighbour.

That would mark a sharp slowdown from last year. The government says the economy grew 5.2 percent in 2011 but economists are sceptical.

The International Monetary Fund said in September that weak government policies have led to a slowdown in investment in Lebanon. The conflict in neighbouring Syria is also hurting investment and slowing policymaking as sectarian tensions within the Lebanon government have increased following the war in Syria.

Lebanon saw rapid growth until early 2011 when the economy ground to a halt following a government collapse and fallout from the early stages of the uprising in Syria.

Salameh also told Reuters that Lebanese banks in Syria have lost $400 million during the 20-month-old crisis in Syria.

He said that the government is also planning to exchange 1.5 billion dollars of Eurobond debt when it matures in 2013 and said that a Beirut stock exchange IPO would be ready in "one or two years."

He said the government was also issuing new Eurobonds.

"The Lebanese government is currently issuing between 1.5 and 2 billion dollars of new Eurobonds. Proceeds will be used by the government for budgetary purposes," he said, without giving a detailed time frame.





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