BEIRUT: The president of the Association of Banks in Lebanon predicted Monday that local banks would continue to maintain steady profits in 2013 despite the difficult environment in the country and the Middle East.
Speaking at the opening of the Lebanon Capital Markets Day in New York, Joseph Torbey said Lebanese banks were still liquid and had huge assets that exceeded the country’s GDP.
“Those of you who have observed Lebanon closely over the years know just how big a role the banking sector plays in our country. We are truly the engine of growth, with a balance sheet of $152 billion at the end of 2012, nearing 3.5 times the GDP estimated at $43 billion by the IMF,” Torbey said.
The leading banker, who is also the president of the Union of Arab Banks, hailed the Lebanese government decision to implement the long-awaited Capital Market.
“Lebanon Capital Market Day would be a promising opportunity under any circumstances ... an opportunity for us to call attention to how much a free market system has achieved in our country ... and the terrific economic opportunities that lie ahead for both the Lebanese people and for our partners throughout the rest of the world,” Torbey said.
The banker touched on the efforts of the Lebanese banks to shore up the economy and help the government finance the public debt.
“Historically speaking, during the 15 years of Civil War in Lebanon between 1975 and 1990, our banking sector consistently provided the government with the necessary funds to ensure the continuity of the public authority, and also provided the private sector with financing schemes that kept the economy going. Following the war, Lebanese banks actively participated in the ambitious reconstruction processes of the country and turned Beirut into the jewel of the Middle East,” Torbey said.
He stressed that despite the crisis that plagued Lebanon, all of the Lebanese remained deeply attached to political freedom and a free economic system.
Economy and Trade Minister Nicolas Nahas said Lebanon had successfully weathered the fallout from the regional changes and the effects of the international financial crisis. He added that Lebanon was still a safe haven for foreign investments despite the events taking place in the country and region.
The American Lebanese Chambers of Commerce also made a presentation about the performance of the Lebanese economy in 2012.
“Despite an adverse political environment and difficult regional global conditions, Lebanon’s economy has enjoyed, solid and sustainable growth and was able to weather several shocks,” the presentation said.
But the report admitted the Lebanese economy had been witnessing a slowdown since 2011, suffering from the regional turmoil and an internal stalemate, and called on all concerned parties to address the challenges and preserve economic and social stability.
“To reactivate the economy, create jobs and attract investments in an increasingly competitive environment, Lebanon is urged to reactivate its “economic growth engines,” and focus on supporting high potential growth sectors,” the report advised.
It added that these objectives could not be fully achieved without major improvements to the economic infrastructure, the launch of structural reforms and the strengthening of competitiveness. “In this context, Lebanon should identify the main drivers for an inclusive economic growth – and work with the various stakeholders on an approach for developing a “growth agenda” for the future,” the report recommended.
