At a dinner held in honor of World Bank president James Wolfensohn, Lebanon’s Premier Rafiq Hariri said Monday that his government had embarked on a major structural reform effort to overhaul and update laws and procedures in an effort to revive the country's status as a regional business center, reported the Daily Star.
Hariri expressed confidence that the World Bank would "enhance its support in the next few years" to help the country reach its economic potential.
Hariri said the government was adopting a "comprehensive economic strategy" that would recreate "a niche for Lebanon in the Arab and global economy.”
He said the strategy was part of a drive to modernize all laws governing economic activity "with a view to recapture our leading role as an open, liberal market economy," adding that the next few weeks would see "new initiatives, including Social Security reform and a new investment law.”
Other components of the plan included restarting various projects financed by the international financial community, he said.
Hariri said the government had also embarked on reforming the tax system, with a view toward introducing a value-added tax and a global income tax. A privatization program will also enhance the economy's productivity, increase foreign investment and provide resources for debt reduction, according to the premier.
The plans also provide for further integration with the global economy by "multiplying our efforts to conclude the Euro-Med association agreement with the European Union, moving forward with WTO accession, and enhancing economic cooperation with Arab economies," he added.
The premier was quoted also as saying he wanted to improve the private sector's competitiveness through the development of a "significant information technology sector.”
For his part, Wolfensohn expressed optimism over Lebanon's future.
"We admire the programs you propose ... but this requires good administration and sacrifices," he said. "To achieve this you are in need of friends and we consider ourselves among these."
According to the World Fact Book, the 1975–91 civil war seriously damaged Lebanon’s economic infrastructure, cut national output by half, and all but ended Lebanon’s position as a Middle Eastern banking hub.
However, Peace has enabled the central government to restore control in Beirut, begin collecting taxes, and regain access to key port and government facilities. Economic recovery has been helped by a financially sound banking system and resilient small- and medium-scale manufacturers, with family remittances, banking service, manufactured and farm exports, and international aid as the main sources of foreign exchange. Lebanon’s economy has made impressive gains since the launch of “Horizon 2000,” the government’s $20 billion reconstruction program in 1993. Real GDP grew 8 percent in 1994 and 7 percent in 1995 before Israel’s Operation Grapes of Wrath in April 1996 stunted economic activity. Real GDP grew at an average annual rate of less than 3 percent per year for 1997 and 1998 and only 1 percent in 1999. During 1992–98, annual inflation fell from more than 100 percent to 5 percent, and foreign exchange reserves jumped to more than $6 billion from $1.4 billion – Albawaba.com
© 2001 Al Bawaba (www.albawaba.com)
