Bchamoun
Industrial
Park
Location Infrastructure and Facilities
Economic
Incentives
General Incentives
Lebanon's free market economy ensures total freedom of exchange, and free
transfer of capital, interest and dividends with no restrictions or
controls. The National Institute for Investment Guarantees (NIIG) was created to attract foreign
investors. To encourage industrial investments in Lebanon, the government joined the
Multilateral Investment Guarantee Agency, which insures investors against
transfer and expropriation risks.
In the continuing effort to attract industries, the Lebanese Central Bank has begun a new initiative to subsidize interest on industrial loans. Loan guarantees for export are also available through IAIGC (Arab countries), COFACE (France), HERMES (Germany), ECGD (UK), OPIC, Import-Export Bank (US), SACE (Italy), and MIGA (World Bank).
Tax exemptions for Industrial Firms:
Corporate income tax exemption
for a period of ten years, beginning on the first day of production, on
profits of industrial firm established in Lebanon after 1980. Exemption
applies only to companies who manufacture products not produced locally.
These industrial firms must be located in regions where the government
wishes to develop and must have assets of at least LL 500 million. Total
profits exempt from income tax cannot exceed the value of fixed assets
before amortization. Fiscal exemptions exist for industrial firms
allocating part of their profits to their own investment in Lebanon.
Encouragements of Technology Transfer:
there are various incentives provided to industries involved in technology
transfer.
The granting of industrial licenses
to foreign companies does not require any exceptional administrative
authorization. This liberal policy favors contracts involving various
forms of technological transfer (turnkey contracts, joint ventures,
management contracts or franchising, etc.)
Imports of machinery, equipment, spare parts, and building
materials used for the setting up of new industrial firms in Lebanon
are subject to a 3 % customs duties.
Equipment and products that are imported for
development project and that are totally or partially financed from
foreign sources are exempt from custom duties.
Financial Incentives
The government through the Central Bank of Lebanon Decree
No. 6549 grants 5 % interest rate support on loans related to the
industrial sector.
Government purchases for public projects
favor locally produced goods with a 15% comparative price advantage.
69 local and foreign banks provide financing
for new industry. Competition is encouraging local banks to
diversify and seek new innovative ways for providing services.
International Finance Corporation (IFC) provides
equity and debt financing for industries.
The European Investment Bank (EIB)
provides funds to finance medium and small-sized industrial projects.
These could either be new projects or those related to the rehabilitation
and expansion of existing infrastructure.
Loan Guarantee Agency (KAFALAT)
Beneficiaries: Small and medium sized firms
that have less than 20 employees.
Conditions to benefit from the loan:
- Extent of guarantee: 75% of the loan and its interests
- Lending Banks: Banks operating in Lebanon
- Loan Amount: Maximum of LL 100 million or equivalent in foreign
currencies
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