Lebanon Drives Away Business, Says World Bank

Al-Akhbar is currently going through a transitional phase whereby the English website is available for Archival purposes only. All new content will be published in Arabic on the main website (www.al-akhbar.com).

Al-Akhbar Management

Lebanon increased the cost of doing business, even though the country took steps in 2008 and 2009 to simplify business registration. (Photo: Haitham Moussawi)

By: Mouhamad Wehbe

Published Thursday, October 31, 2013

The World Bank’s “Doing Business 2014” report ranks Lebanon 111 out of 182 global economies on the “ease of doing business,” dropping six spots from last year. However, the report’s assessment does not include the structural imbalance and the political corruption that contribute to crippling the process of starting a business in the country.

The Lebanese economy is ranked lower than the overall average of countries in the Middle East and North Africa. On a global scale, the United Arab Emirates ranks 23 and Saudi Arabia 26. Algeria ranked lower than Lebanon on a global scale, at spot 153.

Ease of business indicators include:

Starting a Business: Lebanon ranks 120 in this category. The report notes that in 2011 Lebanon increased the cost of doing business, even though the country took steps in 2008 and 2009 to simplify business registration.

Construction Permits: Lebanon ranks 179, while the regional average is 103. There are 20 procedures that an investor must undergo to obtain building permits and complete required paperwork. It takes 246 days to finish these procedures at a cost of 352.5 percent of income per capita.

Getting Electricity: Lebanon ranks 51 compared to the regional average of 76. In this area, Lebanon is oddly ahead. Five procedures are required at an estimated time of 75 days and a cost of 98 percent of income per capita. The report points out that Lebanon decreased the fees for obtaining electricity by reducing installation charges. The report does not indicate, however, that there is not sufficient electric power in Lebanon to provide for a business’s needs.

Protecting Investors: Lebanon ranks 98 compared to the regional average of 119. This ranking does not mean that Lebanon is ahead in this area because it consists of practices that need to be regarded with a degree of skepticism. For example, the investor protection index is five compared to a regional average of 4.4. But the regional average for the Middle East and North Africa is not a standard that can be relied upon for the transparency sought by the authors of this report.

Paying Taxes: The report indicates that tax payment in Lebanon became easier after removing prerequisites for tax breaks. The total tax rate is 30.2 percent of profit, including social security taxes.

Trading Across Borders: 97 compared to the regional average of 98. Export time is 22 days at a cost of $1,080 per container. Import time is 30 days at a cost of $1,365 per container.

This article is an edited translation from the Arabic Edition.

Comments

Post new comment

The content of this field is kept private and will not be shown publicly.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Allowed HTML tags: <a> <em> <strong> <cite> <code> <ul> <ol> <li> <dl> <dt> <dd><img><h1><h2><h3><h4><h5><h6><blockquote><span><aside>
  • Lines and paragraphs break automatically.

More information about formatting options

^ Back to Top