Lebanese central bank chief sees growth up slightly this year

Salameh: “Lebanon’s growth situation is positive.”

BEIRUT: The country’s stimulus plan was helping to eke out expansion in the country, Lebanon’s Central Bank Governor Riad Salameh said Tuesday, reiterating that economic growth was expected to surpass 2 percent in 2013.

Salameh said the stimulus plan, which includes housing loans, loans to the productive sector, and loans for the energy sector, should allow for a slight increase in growth this year.

Lebanon is in its third year of relatively sluggish growth.

“Real growth for this year is expected to be above 2 percent,” Salameh told Reuters at an economic conference in Beirut. “If the political environment remains amenable, the season in which Lebanon achieves the most growth is between June and September. So it is possible that we could exceed this number.”

The 2012 growth rate was estimated at 1.5 percent in an economy that is is partially dependent on summer tourism from Gulf Arab states. Tourism dropped last year due to travel warnings, but some Lebanese officials have said they expected an increase in Gulf visitors this summer.

Lebanon enjoyed gross domestic product growth of around 7 to 8 percent annually from 2007 to 2010, but that fell off sharply in 2011 after the government collapsed due to domestic political jockeying. Tensions further increased when the uprising against President Bashar Assad in Syria began a few months later.

Sectarian tensions in Lebanon have been exacerbated by the conflict in Syria, where the Sunni Muslim majority is fighting to overthrow Assad, who is from the Alawite minority.

Salameh said Lebanon’s economic conditions were better than in countries hit by the wave of protests that spread across the Arab world and toppled governments in Tunisia, Egypt, Libya and Yemen.

“Today, compared to what is happening in other non-oil producing Arab countries, Lebanon’s growth situation is positive. With our stimulus plan for credit we have strengthened possibilities for growth so that we would not have to face any decline or stagnation,” he told journalists.

A version of this article appeared in the print edition of The Daily Star on April 24, 2013, on page 5.




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