JUNE/JULY INVESTOR TRAFFIC REPORT
Despite the overall climate, the Investment Development Authority of Lebanon (IDAL) met with 8 investors with upcoming investment projects in the Industry, Agriculture sector, Agro Industry, Technology and Tourism sectors.
A more in depth analysis of the projects brought forward, show plans to develop a steel factory, a recycling plant, and a factory for prefabricated houses in the Industry sector.
The market for prefabricated houses in Lebanon is still under-supplied and could present tremendous opportunities for growth. Overall, the global housing industry is moving towards a ‘Green’ identity, with increasing use of prefabricated, eco-friendly and energy-efficient homes in modular designs.This could be a sector where Lebanon could innovate given the continuous demand for housing units. The recycling market is also underdeveloped with the local market currently dominated by few large players.
The projects in the Agriculture sector consists of one packing house and cold storage facility for high quality grapes and one farm to produce dairy products. Today, more than 8% of agro-food companies are involved in the production of milk and dairy product. A project to develop an olive oil and soap factory was brought forward in the Agro Industrial sector. Olive oil is amongst the most prominent Lebanese signature agro-industrial products supported by Lebanon’s diverse topography, fertile soil, micro-climates. In 2011 (latest census available), olive production was estimated at 90,307 tons, while olive oil production reached 11,300 tons, growing consistently by a CAGR of 6.5% since 2000. Around 30% of total production consists of extra virgin olive oil, the most refined type of olive oil, while the remaining serve as regular virgin olive oil. Exports of olive oil have been on an upward trend over the last four of years, growing at a CAGR of 14%, and reaching 4,162 tons in 2012, more than a third of domestic production. Lebanese olive oil exports are mainly destined to North America and the Gulf. Precisely, exports to the United States, the highest, reached 915 tons, or 22% of the total. It was closely followed by Saudi Arabia with 835 tons, or 20% of the total.
Regarding the other projects that were brought forward to IDAL, a 4 stars hotel is planned to be developed in North Lebanon, a region highly under-supplied with 4 and 5 stars hotels. In theTechnology sector, a 3-D printing project that uses green technology was brought forward.
Almost all investors are of Lebanese origin, with the exception of one company which is a joint venture of Lebanese and Kuwaiti investors. In terms of the type of projects, 7 of the projects are new or Greenfield and one consists of an expansion of an already established factory.
To conclude, from the 8 projects that were reviewed by IDAL, 6 are eligible for IDAL’s incentives while 2 do not meet the requirements set forth by Investment Law No.360 in terms of investment size and number of jobs created.