BEIRUT: A new pharmaceutical plant inaugurated Wednesday follows in the footsteps of several drug manufacturers that have invested in Lebanon over the past several years.
Expanding domestic pharmaceutical demand and Lebanon’s proximity to fast-growing emerging markets seen as potential export destinations led to the establishment of the Arwan project.
Arwan, built over 17,000 square meters in the Chouf town of Jadra, some 20 kilometers south of Beirut, was supported by the Investment Development Authority of Lebanon, which provides financial incentives including exemption from corporate income taxes.
Estimated by IDAL as a $17 million investment, Arwan will create more than 83 new jobs.
The project was founded by Emirati businessman Abdul-Razzaq Yousef and will export more than 90 percent of its production to the MENA region.
“Lebanon’s business environment still enjoys a good reputation and offers attractive and promising opportunities in many economic sectors despite all the difficulties that the country and region are witnessing,” head of IDAL Nabil Itani said at the plant’s inauguration ceremony.
Lebanon’s pharmaceutical market was estimated in 2012 to be worth around $1.28 billion, growing 6.5 percent compared to 2011 with a forecast compounded annual growth rate of 7.71 percent through 2015, reaching a total value of $1.41 billion, Itani said.
This growth has also been reflected in the sales of pharmaceutical products, expected to reach $426 per person in 2019, nearly double the 2009 figure of $206.
Besides the projected growth in its domestic market, Lebanon’s strategic geographic position among the fastest growing markets is even more promising for pharmaceutical industries at a time when developed markets are witnessing slower growth rates, Itani said.
Emerging economies are expected to contribute to the highest market growth rates in the industry, growing at around five times the rate of developed countries through 2020, Itani said.
Despite being a net pharmaceutical importer, Lebanon’s exports have been growing at a compounded annual rate of 14.1 percent from 2008 to 2012, when they reached $31.43 million, according to Itani.
Pharmaceutical imports increased by 12.9 percent between 2010 and 2012 to reach $970 million, accounting for nearly 90 percent of the market while locally manufactured drugs constitute an estimated 10 percent. Lebanon’s pharmaceutical market currently comprises 10 manufacturers.
Top import sources include France, the United Kingdom, Germany and Switzerland while leading export destinations are Arab countries, mainly Jordan, Iraq and the United Arab Emirates, followed by European countries such as the U.K. and Cyprus.
Middle Eastern countries are expected to register one of the highest growth rates globally. Saudi Arabia’s pharmaceutical market is expected to grow by an annual 4.7 percent to reach $4.7 billion by 2016.