|UN report : Foreign direct investment on rise (Daily Star)
|FDI increases to $7.3 billion in 2003
Despite overall rise, region still lags behind, and experts say more must be done
Foreign direct investment (FDI) in Lebanon rose to $358 million in 2003 compared to $257 million in 2002, a jump of 12.1 percent, according to a World Investment Report issued Wednesday by the UN Conference on Trade and Development (Unctad).
Overall investment in Lebanon and other Arab countries has surpassed other years, but is still far lower than countries in Asia, Europe and the U.S.
Total accumulated investment in Lebanon for the past 10 years stood at $1.981 billion up to 2003. However, the report did not give details about the types of investment in Lebanon and other Arab states.
According to the Unctad report, Lebanon ranked 90th in the world in terms of FDI for 2003 out of 193 countries.
However, the report also said Lebanese investments abroad in 2003 rose to $97 million from $74 million in 2002.
The report offered no specific numbers on the Mideast region, as the organization considers the region part of Asia.
Total FDI in the Arab countries in 2003 stood at $7.3 billion. Bankers and analysts who participated in several investment conferences in Beirut say Arab states could attract more investment if they liberalize their economies and give tax incentives.
The report said FDI in West Asia, a grouping of 13 countries that includes Lebanon, Syria and Jordan, rose to $4.132 billion in 2003 from $3.554 billion in 2002.
Foreign investments in Lebanon have risen considerably since the Sept. 11, 2001, terrorist attacks.
Most of these investments came from Arab Gulf companies that shied away from the West following the attacks and focused on real estate projects and hotels.
Bassil Fuliehan, a deputy and former Economy and Trade minister in Lebanon, said during the discussion of the report at Escwa headquarters that the Unctad report should have included detailed coverage of investments in the Middle East.
He said total investment in the region and Lebanon is still low compared to other countries despite improvements over the past two years. Foreign investments in Lebanon rose from $250 million in 1999 to $358 million in 2003.
Fuliehan also stressed the need to liberalize Arab economies in order to attract more foreign investment.
"Apart from Lebanon, Jordan and Dubai, most of the Arab states need to liberalize their economies," he said, adding that offshore firms should invest in Lebanon and Arab states to generate jobs there.
Fuliehan also said the tense regional political situation has undermined efforts to attract investment.
Mohammed al-Gergawi, chairman of the Dubai Development and Investment Authority (DDIA) said at a new conference in Dubai that the six Gulf Cooperation Council states attracted $1.81 billion in investment in 2003. This figure, he said, is simply not enough when compared to the $650 billion generated globally.
"Even the $7.35 billion the entire Arab world received in 2003 is but a drop in the ocean," he said, adding that 14 of the 22 Arab states found themselves in the top 100 on Unctad's FDI potential index, which ranks countries on the basis of attracting FDI.
The Daily Star