41561
Lebanon CB to Offer New Incentives
World Economy

Lebanon CB to Offer New Incentives

Lebanon’s Central Bank will funnel more stimulus to key sectors to prop up the country’s economy, Riad Salameh said.
The central bank governor confirmed that it would launch new incentives in the future in a bid to increase investment in the knowledge-economy sector, which attracted no less than $250 million from Lebanese banks since the 2014 launch of a program to fund startups, Albawaba reported.
Salameh said that the central bank also recently launched new loan guarantees amounting to $100 million for the arts and movie production with an interest rate of 1%, allowing Lebanese banks to lend to Lebanese producers at low rates.
Despite the need for such programs, Salameh made comforting comments about the future of the country’s economy in remarks at the Arab Economic Forum recently.
Notably, Lebanon’s GDP will reach 2% in 2016 compared to 3% in the region according to IMF estimates, he said. “The central bank considers this percentage to be acceptable relative to the current difficult circumstances prevailing in the region.
“As for the inflation rate, it will reach 1%, meaning that the purchasing power of consumers will be stable,” he said. The economic stability is partly due to the central bank’s unconventional monetary policy.

 Funding Startups
In 2014, the central bank issued Circular 331 aimed at securing funds for local startups. The circular allows commercial banks to give some $400 million in subsidized loans to local startups. These loans are 75% guaranteed by the central bank for local banks, equity investment accelerators, incubators, funds and startups.
“These incentives have also allowed the creation of companies with a total capital surpassing $600 million which contributed to the creation of new job opportunities,” Salameh said. He added that the central bank will also continue to offer residential loans which numbered 130,000 this year, allowing a great many Lebanese to own houses. “We will also continue with our loans to small companies which help in boosting economic growth.”
The initiatives are also good for local banks, which can lend without taking on as much risk. Salameh said that Lebanese banks’ deposits are expected to grow by 4.5% to 5% in 2016. “Lebanon will receive around $8 billion in deposits this year and this amount is enough to finance both the private and public sectors.”
He added that lending will stand at 5.5% in 2016 and this shows an improvement compared to last year.
Salameh said that the deficit in the balance of payments which reached $664 million in the first three months of 2016, constitutes a challenge facing monetary stability in Lebanon.

 

Short URL : http://goo.gl/y2tifk
  1. http://goo.gl/Lb9bBR
  • http://goo.gl/UOFPXn
  • http://goo.gl/6poC4v
  • http://goo.gl/J0OrQe
  • http://goo.gl/rtSH4E

You can also read ...

Shifting transactions from cash to digital payments holds great promise for  individuals, businesses and governments.
More than 23% of the world's economy operates out of sight of...
Federal Reserve Board Chairman Jerome Powell speaks during a hearing before the Senate Banking, Housing and Urban Affairs Committee.
US Federal Reserve Chairman Jerome Powell said protectionism...
India Launches 888 Anti-Dumping Probes
The Indian government has initiated as many as 214 anti-...
Fitch Retains Philippine  Debt Rating
Global debt watcher Fitch Ratings kept the Philippines’...
The warnings come amid a period of financial uncertainty for the world.
US officials who helped the country survive the 2008 financial...
EU to Fine Google $5 Billion
Google will be fined about €4.3 billion ($5 billion) by the...
Africa Next Frontier for Crypto
Cryptocurrency is not bound by geography because it is...
UN to Help Rebuild Gaza Economy, Create Jobs
Against the backdrop of rapidly rising tension, violence,...

Trending

Googleplus