Doing Business In

Lebanon
Mokhlis Dally and Hasan Fawaz
 Quick insight on Lebanon
• Name: Republic of Lebanon
• Capital: Beirut
• Political Structure: Parliamentary Republic
• Currency: Lebanese Pound (LBP)
• GDP (Nominal): Approximately $33 billion USD (2021 estimate)
• Official Languages: Arabic, French, English
• Area: Approximately 10,452 square kilometers
• Population: Approximately 6.8 million (as of 2021)
• Religion: Religious diversity, including Muslims (both Sunni and Shia) and Christians (Maronite, Greek Orthodox, etc.).
• Independence: November 22, 1943, from the French Mandate
• Parliament: Multi-confessional system with seats allocated among different religious sects.
• Economic Challenges: High public debt, political instability, and the impact of regional conflicts.
• Major Industries: Diverse economy with sectors like banking and tourism playing significant roles.
Contents

• Lebanon’s Centralization
• Insurance
• Transportation
• Currency
• Relations and Workforce
• Traditions
• Industries
Centralization
1. Economic Centralization: The Lebanese economy has faced
centralization challenges, with wealth and economic
opportunities concentrated in certain regions, particularly in and
around the capital, Beirut. This centralization has resulted in
regional disparities and uneven economic development.
2. Administrative Centralization: Administrative centralization
refers to the concentration of administrative functions and
decision-making power in certain institutions. In Lebanon, the
central government in Beirut historically held significant
authority, sometimes at the expense of local governance.
3. Languages: Official documents are in Arabic, business talks
too, systems and accounting in English or French.
Insurance
The most popular insurance providers in Beirut are Arope, Allianz, Fidelity ,
Libano-Suisse and Arope.
Offering a comprehensive range of insurance services to individuals and
businesses. While details may change, common coverage includes:
• Motor Insurance: Cars, motorcycles, and commercial vehicles.
• Property Insurance: Protection against losses or damages for
homeowners, renters, and businesses.
• Health Insurance: Coverage for medical expenses, hospitalization, and
healthcare costs.
• Life Insurance: Financial protection for beneficiaries in case of the
insured person's death.
• Travel Insurance: Protection for unexpected events while traveling.
• Business Insurance: Coverage for property, liability, and other
commercial risks.
• Marine Insurance: Safeguarding goods in transit against losses or
damages.
• Engineering Insurance: Coverage for construction projects, machinery,
and engineering-related activities.
 • Road Network: Extensive but faces issues like
potholes and inadequate signage.
• Traffic Congestion: Pronounced in urban areas, driven
by high population density.
• Public Transportation: Limited infrastructure, slow
progress in improving services.

Transportation • Maintenance Challenges: Political and economic

instability hampers regular maintenance.
• Driving Conditions : Challenging terrain, weather-
related complications.
• Infrastructure Projects: Hindered by political and
economic instability.
• Economic Impact: Transportation inefficiencies
impact businesses and development.
Currency

Lebanese Pound (LBP): Once a Stable

Currency
•Historically stable, the Lebanese Pound held a
strong position in the Middle East.
Currency Depreciation:
•Dramatic drop in value: from 1,500 LBP for 1
USD to a staggering 150,000 LBP for the latter.
Shift to USD:
•Widespread adoption of USD for transactions.
•Pricing now done in USD, with real-time
exchange rate translations.
Economic Impact:
•Severe economic challenges due to currency
devaluation.
•Businesses and individuals adapt to USD-based
transactions for stability.
Relations and Workforce
Educational Excellence:
• Lebanon boasts a population with a strong emphasis on education.
• High literacy rates and a culture that values intellectual pursuits contribute to a well-
educated populace.
Networking Challenges:
• Despite a highly educated population, success can be challenging without connections.
• Networking and relationships, particularly with politicians, are often considered essential
for career advancement.
Political Influence:
• The intricate web of political affiliations can significantly impact professional opportunities.
• Many believe that success in Lebanon is closely tied to having connections within the
political landscape.
Challenges to Meritocracy:
• While meritocracy is an ideal, the prevalence of nepotism and favoritism is a challenge.
• Success may be influenced by familial or political ties rather than individual qualifications.
Economic Implications:
• The reliance on connections in professional spheres may limit equal opportunities.
• The economic landscape may favor those with political affiliations, impacting the broader
socioeconomic structure.
Aspirations for Change:
• There is a growing awareness of the need to move towards a more merit-based system.
• Calls for transparency and equal opportunities are becoming louder within Lebanese
society.
 Business Traditions
• Entrepreneurial Spirit: Resilient and resourceful business approach.

• Family Businesses: Dominance of family-owned enterprises, often passed down through

generations.

• Networking and Relationships: Emphasis on building strong personal connections for

successful business dealings.

• Negotiation and Diplomacy: Nuanced negotiation and diplomatic skills highly valued in
business interactions.

• Adaptability: Flexibility and adaptability in navigating economic and political uncertainties

• Diversity and Multilingualism: Multilingual environment (Arabic, French, English) facilitates

international business.

• Banking and Finance: Strong presence of resilient Lebanese banks, attracting clients
regionally and globally

• Social Etiquette: Informal settings, such as dinners and social gatherings, are integral to
relationship-building.

• Influence of Culture and Religion: Business practices influenced by Lebanon's rich cultural
and religious diversity.

• Resilience in the Face of Challenges: Demonstrated resilience of businesses despite periods

of economic and political instability.

• External Affiliation Dependency: Many businesses in Lebanon either operate as branches of

international entities or have established external affiliations.
 1. Tourism: 2. Banking and Finance:
Rich history, cultural Robust banking sector known for
heritage, and scenic stability.
landscapes drive tourism. Attracts both domestic and
Historical sites and the international clients.
Mediterranean coastline
contribute to the industry.
Industries
• The top four revenue-
generating industries in
Lebanon:

3. Real Estate: 4. Services and Hospitality:

Historically pivotal despite Services sector, including hospitality
economic challenges. and entertainment, significantly
Investments in commercial and contributes to the economy.
residential properties. Restaurants, hotels, and
entertainment venues cater to both
locals and tourists.
 Herzlichen Dank für
Ihre aufmerksamkeit
Habibis