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British initiative to promote businesses, employment in Lebanon

20-1-2020

In its edition of January 17, An Nahar drew attention to the Lebanon Enterprise and Employment Program (LEEP) funded by the British Department for International Development (DFID). Said program, to recall, supports small and medium enterprises through the provision of funds and mentoring in business development with the aim to help them grow and stimulate employment. According to An Nahar, the above program partners with banks and financial institutions involved with small loan programs, as well as providers of business development services (BDS). It seeks to help beneficiaries who got business loans last year worth of USD 8000 and 7500 to receive a grant 50% of the loan value. Beneficiaries are expected to benefit from BDS services offered by specialists to help them implement and activate their business plans and access new markets, in addition to support in management and the creation of jobs. The program reportedly stresses gender-based equality to strengthen social integration of women. In this respect, the head of the program’s action team, James Carty, explained that the UK government has designed the program to help SMEs in Lebanon which represent the backbone of national economy. This, he said, could infuse a major outlet for the country amidst the critical economic situation.(An Nahar, January 17, 2020)
 

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Work & livelihoods: Rising unemployment and prices in the absence of pubic control

16-1-2020

An Nahar today warned of a grave unemployment crisis brought on by the calamitous economic and financial situation. Citing Information International, the newspaper revealed that the year 2019 has seen the layoff of nearly 18,000 employees, including 9,000 in the past three months of the same year, in addition to the cut to half in salaries of about 50,000 employees. Others have not received their thirteenth salaries, the newspaper wrote, noting that most of the layoffs were in the tourism and hospitality sector. In a related vein, An Nahar quoted labor minister, Kamil Abu Sleiman, who noted that the ministry has recently received 120 requests from companies involving collective termination of employment, including 5,000 employees, while the said newspaper confirmed that the number could be much bigger, noting that InfoPro Research estimated in a study on the conditions of the private sector, published last November, that since popular protests on October 17, 2019, private sector lost more than 160,000 permanent or temporary jobs, and closed 10% of its establishments. Regarding unemployment rate, An Nahar quoted human development consultant, Adeeb Ne3meh, who stated that the rate of unemployment is expected to rise in the upcoming months, either directly through job loss or through reducing working hours and working days and hence paying half the salary. Similarly, Al Diyar daily mentioned the fluctuation in prices of the basic commodities and foodstuff is not only the result of the high exchange rate of the US dollar at money exchangers, but also because of monopolistic, Al Diyar explained, quoting a number of large merchants who said they imported large quantities of goods before the October 17 Uprising. Surveillance of traders by competent authorities is very difficult at this critical stage, especially that the number of small traders is tremendous against only 140 inspectors from the ministry of economy and trade. Al Diyar pointed out that, based on the Consumer Price Index of the Central Administration of Statistics, clothing and footwear prices increased by 30% during November compared to the prices of October. The prices of spirits, tobacco, furniture and household items rose 15%!. (An Nahar, Al Diyar, January 16, 2020)

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Livelihoods: Health care at risk, tampering at the petrol stations, but internet services safe for now

15-1-2020

The caretaker health minister, Jamil Jabak, announced yesterday that he reached a temporary solution to the impasse related to the import of medical equipment by settling the dollar exchange rate which allows importers and hospitals to survive and continue. Yet, Al Akhbar daily reported that Jabak did not clarify how to apply this solution when the majority of Lebanese banks refuse to comply with the Banque du Liban’s governor’s directive to open credits in hard currency for medical suppliers, while hospitals’ syndicate president, Suleiman Harun revealed that he will soon inform the guarantor funds that hospitals can no longer perform surgeries that involve medical equipment’s, adding that he crisis is seriously jeopardizing the health sector and needs an exigent intervention on part of the central bank On the other hand, the caretaker minister of energy, Nada Bustani, promised the head of the Syndicate of Owners of Petrol Stations, Sami Brax, to persuade petroleum importing companies to deliver fuel in exchange for payment in Lebanese lira only. For his part, the minister of economy, Bteish, issued a circular warning owners of petrol stations of any tampering with the meters on pumps. Concerning Ogero’s threat that Lebanon is at risk of being disconneted from the global web by the end of March 2020 if the requisite dollars to maintain internet connectivity were not secured, Ogero chairman, Imad Kreidieh, said this is out of the question at least for the next six months! Likewise, while the former Ogero director, Abdel Monem Yousef, denied the inability of the country to pay, An Nahar newspaper said the transaction is made through an Ogero account in USD at the Investments Department at Banque du Liban, adding that dues are paid to companies in dollars without any difficulties. (Al Akhbar, An Nahar, Al Diyar, January 15, 2020)

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Cannabis growers complain of Lebanese liquidity crisis!

13-1-2020

The cultivation of cannabis has been affected by the financial and economic crisis hitting Lebanon since October, Al Akhbar reported today. Despite a prosperous season which saw no destruction of the produce or raids on warehouses, the price of one unit of processed cannabis reached a record low. In addition, the price of the lease of one dunum of marijuana dropped to rates unprecedented even at the height of operations carried out by security forces to destroy the fields. Citing a concerned industrialist, Al Akhbar said sales are almost non-existent, explaining that the decline in prices was not the only blow, but it was also coupled with severe shortage in liquidity. “What is the use if we sell but cannot withdraw the money from the bank,” he complained. Another producer said the ‘business’ is no longer affordable, yet it remains more useful compared to the growing of potato and onion. The cost of planting one dunum of potato or onion stands at LBP one million, against only LBP 120,000 for cannabis, including the cost of seeds, land lease, weeding and irrigation. For his part, a cannabis farmer lamented the slashed prices, pointing out that the price of one unit of processed cannabis has shrunk by 100% compared to last year. It should be noted, that the legislature is studying the draft bill for the legalization of cannabis for medical use: https://bit.ly/382aZk2. (Al-Akhbar 13 January 2020)

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Livelihoods: Disruptions in fuel, bread & electricity supplies, salaries drop 60% in purchasing power

10-1-2020

The fuel crisis returned, as announced the chief of owners of petrol station, George Brax, who warned of closure as a result of the continuing price hikes corresponding to the exchange rate of the US dollar which reached yesterday LBP 2350. He said fuel companies want to withdraw from the former arrangement threatening to impose 15% of the price of fuel in hard currency. Recalling, that in December 2019, the owners of petrol stations agreed to deduct a provisional value of LBP 475 of the royalty for each petrol plate in order to repay the full price of fuel in the Lebanese lira. On a related front, the head of the union of bakeries, Kazem Ibrahim, described as an ‘assault against the sector the monitoring by the Consumer Protection Authority of the price and weight of bread in Lebanese bakeries. He threatened of immediate suspension of work should any owner of a retail bakery be summoned to court. Meanwhile, An Nahar daily wrote that the electricity cuts are getting worse pointing to what the minister of energy said yesterday that the coming couple of days could be very difficult but that the electric power will be gradually restored as of this Saturday. An Nahar said Lebanon could plunge into darkness starting February, according to the former director general of the ministry, Ghassan Beydun. In turn, Al Akhbar newspaper reported that Banque du Liban has refused to itemize the infant formula on the list of the basic commodities included in the circular of provision of the necessary credits for importation in the US dollar. This could threaten with the discontinuation of certain brands of imported milk, Al Akhbar said, pointing out that the caretaker health minister is expected to sign an ordinance today reducing the price of the infant formula after a one-month price freeze pending the approval of the Central Bank to secure the required credits. On the other hand, Al Akhbar indicated that the average monthly salary has lost more than 60% of its purchasing value, causing many Lebanese to give up the consumption of luxury and non-essential items. (An Nahar, Al Diyar, Al Akhbar, January 10, 2020 )

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Livelihoods in Lebanon: Gas and fuel shortages, procrastination in meeting tenants’ rights

9-1-2020

The head of the Syndicate of Owners of Petrol Stations, George Brax, said there is a significant shortage in diesel fuel delivered by importing companies, stressing that the amounts at hand in the fuel installations do not cover local market needs. He revealed that the crisis is fabricated by delivering companies in preparation for a price hike influenced by the recent developments in the region. On the other hand, Brax reassured the Lebanese that the diesel will not be completely cut off, but that there will be quantity shortages. He justified this by the increasing demand from citizens in the winter season and the parallel demand from the owners of private generators due to the mounting energy rationing enforced by the Electricity of Lebanon. In this respect, Al Akhbar daily, citing the director of ‘Sabra and Hamdan’ gas distribution company, Ali Hamdan, warned of an imminent gas crisis. The stalemate, Hamdan explained, began a week ago when gas packaging firms reduced the wholesale order quantity of gas flasks and charged distributors purchasing remaining quantities at the retail price. On another front, following an appeal by the committees of tenants in Lebanon to adjust the rent law corresponding to the current economic situation, (https://lkdg.org/ar/node/19098) , the parliamentary administration and justice committee yesterday discussed said law in terms of residential and non-residential areas. The head of the committee, George Adwan, stressed that as conditions are difficult today due to the inability to secure required funds to implement the prevalent laws, the committee shall work seriously and come up with new proposals to this end in approximately one month. (Al Diyar, Al Akhbar, An Nahar, January, 8, 9, 2020)

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Draft bill to support private investment companies

9-1-2020

The Joint Parliamentary Committees yesterday approved a draft law that sponsors private investment companies. The aim of this move is to step up and facilitate investments, attract practiced investors, stimulate owners of capital to expand the scope of similar firms and provide prospects for skilled young persons to work and grow. The draft law which also seeks to replace bank-based funding and loans with new financing conduits, taking into account the calamitous financial and economic conditions, has been referred to the General Assembly of the Legislature. Noting, that the ratification of the above law came during a meeting of the following parliamentary committees: finance and budget, administration and justice, foreign affairs, national economy, industry and planning, public health, labor and social affairs, agriculture and tourism, and the committee of media and Communications. The meeting was headed by deputy parliament speaker, Elie Ferzli. (Al Diyar, January 9, 2020)

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Livelihoods: Tightened restrictions on bank depositors, more shutdowns by Electricity of Lebanon

8-1-2020

BLOM Invest economist, Ruba Shbair, noted yesterday that the PMI indicator during December 2019 recorded 45, meaning that the growth rate of the total real GDP is below zero. The decline in new businesses during the same month was key to the deterioration in the operating conditions of private sector companies. For his part, the head of Beirut International Chamber of Navigation, Elie Zakhour, warned of a drastic decline in maritime transport should banks continue to interrupt requests to open documentary credits for merchants and industrialists required to import goods and raw material, as well as prevent shipping agencies from transferring freight fees abroad. Similarly, the president of Mount Lebanon Traders Union, Nasib Gemayel, in an address to the Association of Banks in Lebanon, asked how can commercial institutions repay loans if they don’t operate properly, and appealed to save the sector. Noting, that the parliamentary economic committee was concurrently studying the possibility of an economic emergency draft bill.  On the other hand, the Judge of Urgent Matters in Nabatiyeh, Ahmad Mezher, ruled yesterday against Byblos Bank- Nabaytiyeh branch, requiring it to transfer the sum of USD 1,138,580 from the account of plaintiff, Majed abu Zeid, to his HSBC account in Dubai under penalty of a LBP 10 million fine for each day of delay. In a related development, the Electricity of Lebanon announced yesterday that it will have to continue taking the necessary precautionary measures to maintain the longest possible period of supplying power. Such precautions include the reduction of production consistent with the apportioned allocations from the government to the state-run institution. Currently, the reported volume of power feeding the electric network is only 1500 megawatts until next February. (Al Diyar, An Nahar, Al Akhbar, December 31, January 8, 2020)
 

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Livelihoods: Hotel occupancy 20%, exemptions for loan defaulters….

7-1-2020

The head of the Hotels Syndicate in Lebanon, Pierre Ashkar, said the hotel occupancy rate is very weak, barely hitting 20% in the capital and nearly nil (0%) outside Beirut. In an interview, December 29, with Sputnik, Ashkar said he expected a large number of Lebanese expats in Lebanon during the holiday season, which is true, but that the majority stayed in homes not in hotels. He explained that the sector is critically linked to the political and security stability, noting that the only way out is the formation of a new cabinet that will win trust of the parliament as well as the international community. On the other hand, the minister of public works in the caretaker government, Yousef Finianos, issued on December 29, a directive to Lebanese ports requesting the exemption of all cars shipped to said ports from all late fees imposed on relevant delays. This comes as part of measures to alleviate additional costs and huge losses incurred on car importers after the suspension of banking facilities and limits on withdrawals, which prompted many dealers to shut down their auto sales showrooms. In a related development, the parliamentary finance and budget committee approved, in its last session, a draft proposal to suspend until end of June, the measures taken by banks against defaulters requiring them to pay loans backed by Banque du Liban, with a retroactive effect as of the first of October. Noting, that exemptions include various housing, industrial, agricultural, technological and environment related loans. Meanwhile, Lebanon received on Saturday the first batch of gasoline to the Zahrani Oil Installations, after ZR Energy won the state-run tender, in the presence of caretaker minister of energy, Nada Boustani. (Al Akhbar, An Nahar, Al Diyar, December 30, 2019, January 4, 2020)
 

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Agricultural Workers Union calls for supporting agriculture and industry

31-12-2019

In a statement released yesterday, the Agricultural Workers’ Union called for peedy formation of the government to address the dire economic and social conditions. It appealed to newly named prime minister Hassan Diab to adopt an alternative socio-economic policy based on sustainable development that will prop domestic agricultural and industrial production. The Union pressed for a revision of the current rentier-based, IMF, World Bank and WTO supported economic strategies which have clearly marginalized productive sectors, notably agriculture and industry. Such policies have led to the privatization of vital public facilities in the narrow interests of a few, which deprived the state of significant financial resources, the statement said. The successive governments have repeatedly resorted to servicing the public debt through indirect taxes which burdened the working and low-income classes. They opened the markets without restrictions to foreign products incurring additional debts and deficit on the trade balance and the general state budget. This eventually led to literary impoverishing the Lebanese people, particularly workers and farmers, the statement concluded. (Al Diyar, December 31, 2019)

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