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Fuel oil shoring up Lebanese industrial exports

Caretaker Finance Minister Mouhamad Safadi meets Minister Nicolas Nahass with a Delegation, Thursday, September 26, 2013.

BEIRUT: Lebanese industrial exports continued on an upward trend during the first seven months of the year, gaining almost 13 percent compared to the same period last year, but fuel oil took the lion’s share as other exports declined, the Industry Ministry said Thursday.

Total exports increased to $1.97 billion from $1.744 billion a year earlier and were 2.2 percent higher than in 2011.

Fuel oil contributed heavily to industrial exports, the report said. When excluding the $287 million from fuel oil – which was mainly imported by war-stricken Syria – Lebanese exports decreased by 3.3 percent compared to last year.

A meeting of MPs from the Economy, Trade and Planning Parliamentary Committee and industrialists urged the government Thursday to call to reform the industrial sector by cutting costs and providing incentives.

“I can say that figures presented by industrialists are encouraging and we can say the sector is doing well,” MP Nabil de Freij said.

The committee has been meeting on a weekly basis to discuss steps to boost different sectors of the economy.

“Industrialists demanded that Lebanese industrialists should be given preferential treatment when they apply to state tenders,” he said, adding that the government should do more to curb smuggling of imported goods.

De Freij said the industry represented 10 percent of GDP and employed 140,000 individuals.

“There have been no layoffs in the sector even though some sales figures were down,” he said.

In a separate meeting, caretaker Finance Minister Mohammad Safadi met a delegation from the Lebanese Industrialists Association and agreed to provide additional subsidized loans.

“Providing capital is essential for industry and, in cooperation with the Central Bank, [we will help] provide subsidized loans, particularly those related to providing operational capital,” Safadi said.

Industrial machinery and equipment imports increased 12.6 percent, according to the Industry Ministry report – signaling that many industries are expanding production capacity in spite of lower nonfuel exports.

“The significant increase in machinery and equipment imports signals increasing investments in new industries,” the report said.

In July 2013, industrial exports increased 10 percent in comparison to the same month in 2012.

Electric appliances and equipment topped Lebanon’s exports in July with $45.4 million, out of which $14.3 million were exported to Iraq.

Metals and metalwork came second at $39.9 million, with Turkey importing $11 million worth of goods, ahead of the food industry, whose exports increased to $32.3 million.

Syrian demand for Lebanese goods has substantially increased recently but the real figures could be much higher, experts argue, due to a thriving smuggling trade in all kinds of goods – especially pharmaceutical products.

Yet in July Syrian demand for Lebanese goods fell behind that of Saudi Arabia, Iraq and the United Arab Emirates.

 
A version of this article appeared in the print edition of The Daily Star on September 27, 2013, on page 5.

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