2012 sees more investment ventures

IDAL says value of projects applying
for incentives totaled $480 million

The number of investment projects seeking tax incentives grew by 30 percent in 2012, compared to the previous year, according to the end-of-year report by the Investment Development Authority of Lebanon (IDAL). A total of 60 new investment and expansion projects applied for the tax incentives’ package during 2012. Out of this number, 13 applications were approved and only five projects received the final go ahead.

The total value of projects processed during 2012 was $480 million. Around 46 percent of the total investments went to six tourism projects, the majority of which consisted of new hotels and resorts. Tourism projects launched in 2012 include international hotel chain Mandarin Oriental, Lancaster Plaza, and the children's theme park KidzMondo.

The industry sector captured 38 percent of all projects in 2012. The share of industrial projects out of the total investment value has been increasing gradually each year. According to IDAL figures, ventures in the field of pharmaceuticals dominated industrial projects in 2012, namely with the $12-million expansion of Algorithm, and Pharma M with its $1 million production unit. In the technology sector, only one project will benefit from the tax exemptions: A $2 million regenerative medicine center to be set up in Bsalim, Mount Lebanon.

The majority of projects were located in Beirut and Mount Lebanon, with each region capturing 46 percent of projects. Beirut hosted the majority of touristic projects, namely hotels, while Mount Lebanon was the top destination for most industrial projects.

IDAL has recently lowered the criteria needed by firms in different sectors to benefit from fiscal incentives. These changes, which are still pending Cabinet’s final approval, aim to stimulate investment activity. Foreign direct investments to Lebanon are expected to be around $3.5 billion in 2012, slightly down from 2011.