BEIRUT: Lebanon has an interest in the speedy adoption of reforms outlined in the Lebanon Action Plan developed by the EU, a step that would help the country join the World Trade Organization, the European Union Ambassador to Lebanon Angelina Eichhorst said Tuesday.
“We need to have this action plan adopted by the Lebanese government. Otherwise, we won’t be able to move ahead with high-level meetings foreseen with the Lebanese and EU institutions’ leadership in the foreseeable future and with the necessary decisions – including our financial package for the country – that go with it,” Eichhorst said. “WTO membership is not just important; it is urgent.”
Eichhorst’s remarks came during a news conference held by the president of the Lebanese Franchising Association, Charles Arbid, to announce the results of a national franchising industry study, which was done under the LFA’s capacity building project funded by the EU.
The conference was held at the Phoenicia Intercontinental Hotel in Beirut and was attended by Economy Minister Alain Hakim and key representatives of the private sector in Lebanon.
Eichhorst highlighted the importance of Lebanon’s accession to the WTO, saying that it would have a very positive effect on the franchising industry: “WTO membership would attract new business players into the country, including brands willing to operate as a franchise.”
She added that banks would also continue to provide loans and the decrease of custom duties on the import of foreign equipment would accordingly reduce expenses.
“In turn, this would allow entrepreneurs to further develop businesses on the international markets, to increase job opportunities in the country and a smooth shift toward a specialization in the country’s comparative advantages,” she said.
Eichhorst urged the government to put more efforts on introducing new legislation for competition, intellectual property rights, intellectual works protection and trademark protection, which would allow Lebanon to join the international trading community in a confident manner through WTO accession.
“Sadly, an important part of the legislation that will protect entrepreneurs against unfair competition has been pending at the government level or at Parliament for many years now,” she said.
Eichhorst praised the Lebanese franchising sector for providing 100,000 job opportunities in the country, which is almost 9 percent of total job opportunities in Lebanon.
“This figure is rather high compared to the EU, where it does not exceed 2 percent and 6 percent in the United States,” she said.
“The franchise sector contributes to up to 4 percent of GDP in Lebanon against less than 2 percent in the EU and around 5 percent in the United States.”
The study launched by LFA shows that the main export countries for surveyed franchisers are located in the Middle East, namely Dubai and Abu Dhabi in the UAE, followed by Riyadh and Jeddah in Saudi Arabia, Doha in Qatar, Irbil and Baghdad in Iraq, as well as Paris and London.
On the other hand, around 44 percent of franchise concepts operating in Lebanon originated from Europe, 38 percent from the U.S. and Canada and 13 percent were created locally by Lebanese franchisers.
Arbid highlighted the importance of the study conducted with the support of the EU as an indicator of the franchise sector’s contribution to the economy.
“This study is the first of its kind since it covers hundreds of institutions all over Lebanon and reveals the great contribution of this sector to the Lebanese economy,” he said, adding that the sector contributed about $1.5 billion to GDP.
“The number of franchise concepts in Lebanon reached 1,100 with the points of sales amounting to 5,500,” he said.
Arbid said that franchising was the most dynamic and fast-growing industry in the country and this is reflected in the spread of Lebanese franchise concepts in the Arab world and internationally in the past two years, at a time when the domestic Lebanese economy was suffering to a great extent.
Arbid’s remarks were echoed by Hakim, who said that the sector was growing fast in Lebanon.
“The franchising concept moved very slowly from the U.S. and Europe to Lebanon in the 1990s and it was restricted to the restaurants sector mainly,” he said, adding that the industry now covered many other fields such as jewelry, fashion, transport and real estate companies.
Hakim also praised the EU for its human, social and financial support to Lebanon.
Eichhorst said that the EU’s support to the Lebanese Franchise Association of 160,000 euros ($220,000) was part of a larger 14 million euro operation to enhance Lebanon’s private sector development, with the overall goal of creating job opportunities in the country.