Hajj Hasan says Syria trip aims to boost trade

A truck drives through the Lebanese customs into the Syrian territory at the Masnaa border crossing, Saturday, June 15, 2013. (The Daily Star/Hasan Shaaban)

BEIRUT: Industry Minister Hussein Hajj Hasan said Thursday that the main reason behind his planned visit to Syria next week is to participate in the Damascus International Fair and to hold talks with his Syrian counterparts about ways of boosting imports and exports between the two countries. “We also want to discuss ways to remove obstacles to implementing agreements that were previously signed with Syrians and that were not put in force yet,” Hajj Hasan told The Daily Star in an exclusive interview.

Direct contact with the Syrian regime remains a touchy issue in Lebanon, with Hezbollah and its allies pushing for normalizing ties with President Bashar Assad’s regime while the Future Movement and the Lebanese Forces say such dealings should not take place before a political solution is reached to end the war in Syria.

In a bid to avert a political crisis over the issue, Cabinet Wednesday decided to disassociate itself from Hajj Hasan’s and Agriculture Minister Ghazi Zeaiter’s controversial visit to Syria by labeling it as being undertaken in an individual capacity and not in the government’s name.

“The opposition to our visit by some ministers in the government is political but we are still going to Syria. [They] have their opinion and we have ours,” Hajj Hasan said.

In May, Syria ranked fourth on the list of top countries importing products from Lebanon at $12.211 million according to Industry Ministry statistics. The most imported items, valued at $4.23 million, were foodstuffs and tobacco, followed by plastics at $2.311 million, machinery and electric equipment at $2.297, production of chemical industries at $901,000, paper at $601,000, textiles at $426,000 and base metals at $319,000.

Statistics show that 5.4 percent of Lebanon’s exports went to Syria in May 2017. But the report did not cite any figures regarding Lebanon’s imports from Syria.

Before the war broke out six years ago, Syria was the main export route to other countries for Lebanese-made goods.

The closure of the crossing points between Syria and Jordan and Syria and Iraq dealt a severe blow to Lebanese industrialists and farmers, who struggled to find new routes to export their goods.

But despite the opposition of some ministers to the resumption of normal ties with Syria, the country is still supplying Lebanon with electricity through high voltage power lines.

Hajj Hasan said Lebanon has also been holding negotiations with European countries to increase Lebanon’s exports to this region.

“We held several meetings with our European counterparts and we asked them to increase our exports to these countries, but we are still waiting for their feedback on this issue,” he said.

He added that one of the reasons behind low exports to Europe is the strict conditions imposed by these countries on their imports in a bid to protect their industries.

“For instance, one of their conditions is the issuance of a certificate of origin by the exporting country to make sure that the whole product is produced in that country,” he said.

He cited the example of clothing, saying that European countries, for instance, ask Lebanon to produce the whole product in Lebanon from the thread to the textile to the final product, which is impossible and which does not take place in any other country. “There are no 100-percent pure local productions in any part of the world,” he said.

Hajj Hasan said that exports to Arab countries have declined in recent years as well due to the closure of the Nassib border crossing, which is the only functioning crossing between Jordan and Syria and is vital for the transportation of goods from Lebanon and Syria to Jordan and the Gulf states.

According to Industry Ministry statistics, the total value of industrial exports during the first four months of 2017 amounted to $1.13 billion compared to $1.76 billion during the same period in 2016, and $1.248 billion during the same period in 2015.

“Therefore we notice a decline of 5.8 percent compared to the year 2016, and a decline of 18.8 percent compared to the year 2015,” the report said.

It added that the monthly average of Lebanese industrial exports during the first five months of 2017 amounted to $202.6 million compared to $215.1 million in 2016, and $249.6 million in 2015.

Hajj Hasan said the increase in Lebanese exports is not the only measure that should be adopted to improve the industrial sector’s performance in Lebanon.

One of the measures that should be taken urgently is the reduction in the cost of production in Lebanon.

“The cost of production is too high compared to other countries in the region and our markets are open, which is exposing us to high competition by low-producing countries,” he said.

He noted that one way to curb the cost of production is to reduce the cost of energy used in the production process. “This is one of the most basic costs incurred,” he said.

Moreover, the Economy Ministry has recently sent Customs and the Finance Ministry a list of 20 products that need to be protected against dumping from neighboring countries by increasing the Customs duty on these products.

“In this case, the Economy Ministry waits for the feedback of the Finance Ministry and Customs with regard to this suggestion and then it sends it to the government for approval,” he said.

Economy Minister Raed Khoury told The Daily Star a month earlier that this measure would need only two months to start taking effect.

Other necessary measures, Hajj Hasan said, are the support of companies to take part in exhibitions outside Lebanon in addition to increasing the quality of production, merging factories, supporting innovation and scientific research.

Hajj Hasan added that the government must prepare a comprehensive economic policy, which is not available for the time being.

“We do not need time to do that but we only need to make a decision,” he said.

A version of this article appeared in the print edition of The Daily Star on August 11, 2017, on page 4.




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