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Lebanon has unfortunately become one of the worst countries for investment. It’s as if we intentionally sought this. There’s no other way to explain it. Our “country risk” was often already problematic. But now, as the crisis engulfs us, even the slightest attempt to start any business has become an uphill battle. The obstacles are surely known to you, but when stacked together, they’re staggering.

Let’s suppose you have a good project that, at least on paper, promises a good return on investment. Great. But first, you need to be sure that you have all the necessary capital. Because this is probably the only country in the world where bank credit doesn’t exist. Not even an overdraft on the current account. Or a basic credit card. And it’s not even a bank decision. It’s the existing regulations that make credit impossible. Even transfers to and from Lebanon become cumbersome, given the country’s unsavory reputation.

Next step, initiating administrative procedures to materialize the project. For each step, you need to know if the relevant administration is open, fully, partially, not at all, potentially only on Wednesdays between 10 AM and 10:30 AM; then figure out what bribe you need to give to whom, as corruption codes have been shuffled in recent years; then find the key to access the minister if you need his signature for a permit (and assess its fair price or that of his “advisor”); then embark on the impossible quest to find fiscal stamps.

Once all these launching inconveniences are finalized, the real difficulties of the journey begin: your imported container languishes at the port, risking spoiling your merchandise because inspectors haven’t shown up; the National Social Security Fund harasses you to pay contributions, lost funds, as it covers nothing anymore, and you have to double down with a private insurer.

Then there is the ordeal to register a vehicle, register the premises you just acquired, or obtain a building permit. You will also have to comply with a hallucinatory amount of rules issued just to squeeze even more money and time out of you.

All of this is known. So what?

That being said, contrary to all logic, this column will never give you a cliché recommendation like “Why are you still here? Are you starting projects?! Seriously? Hurry up and invest elsewhere!” That’s not our style.

Because, despite everything, through empirical study, we’ve identified sub-sectors that can be profitable, if chosen and managed well. Here’s an overview”

•    Restaurants and related projects, especially if your formula can eventually be franchised and therefore exported. But a restaurant project should aim for a return on investment within three years, no more; otherwise, the risk increases.

•    Hotels are not recommended: too many fixed costs and a market with mood swings. However, furnished apartments with à la carte services are less risky.

•    Agricultural production of exotic fruits, aromatic herbs, and other niche products. For example, our avocados find a promising market abroad. (Lawyer avocados too, for that matter).
•    Any industrial production to replace imports, even if the local value-added is partial or minimal. Lebanese-Scottish Glenbey whiskey has found a special place among whiskies. And even the new Najjar instant coffee, not roasted in Lebanon, already has a good market share.

•    Energy-saving products and services. The concerned ministers boast that installed solar energy now accounts for 30% of total energy capacity. Except they have nothing to do with it, as these are individual initiatives. After the euphoria of 2021-2022, the solar market has calmed down a bit. But it might pick up again, at least in regions enjoying 10 hours of state electricity, as solar supplementation could bypass the dictatorship of generator owners.

•    Tech is still in vogue, as it’s easily exportable; no need for a container to sell software or an app anywhere in the world. Subcontracting in this field is a practically limitless market.

•    Real estate investment is lagging. Even Airbnb can’t always fill its local inventory, given the instability of the security situation. One niche that could be interesting, however, is the market for small office rentals, suitable for startups, small businesses or freelance professionals (doctors, lawyers, accountants, architects…).

•    Providing products and services to international organizations is always a lucrative market. True, they are incredibly picky, but they have cash, lots of it: between $1.5 and 2 billion are poured in every year by UN agencies, other state agencies, in addition to private foreign NGOs. And the suppliers to these organizations are of all kinds: producers, merchants, banks, insurance companies, trainers, car rentals, real estate agents, study and statistics offices…

In short, there will always be those who endlessly say “this country is doomed, there’s nothing left to gain from it,” and those who act according to the famous resilience that sticks to us. History often proves the latter right.

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