Whatever happened to the “great rotation“? Wasn’t 2013 supposed to be the year when investors finally took their cash out of bonds and put it to work in equities?
Judging by the record week emerging market bonds have had, EM equities bulls might have some waiting to do yet. Continue reading »
Lebanon has long exported its bankers and financiers across the world, but its banks have generally remained fairly conservative domestic institutions, venturing only carefully outside the country’s borders, writes Robin Wigglesworth.
Yet given the country’s perennial political turmoil – interspersed with the occasional bout of violence – many Lebanese banks have in recent years looked abroad for opportunities to diversify their operations. One of the pioneers has been Byblos Bank, the third-largest financial institution in Lebanon by assets.
Opening the only five-star hotel in Iraq two years ago was a bold move by any standards. Throw in marketing cigarette makers in Lebanon and distributing Shell Lubricants in Iraq, and Malia Group looks like a controversial risk-taker. Continue reading »
“Don’t forget, revolutions are expensive”, says Dimitris Tsitsiragos. He should know: his responsibilities as a vice president at the International Finance Corporation include north Africa and the Middle East, not least the countries hit by the Arab Spring.
The IFC, the World Bank’s private sector arm, has, in the last five years, boosted its annual commitments to the region by nearly 50 per cent to over $2bn. But, Tsitsiragos says it’s not enough: without more private sector involvement, the region cannot generate the investments required to produce faster economic growth and more jobs. Continue reading »
By Rob Minto and Pan Kwan Yuk
What to do when your domestic market is saturated and slow? Go overseas, of course. The question is when and how difficult a market to pick. For clothes retailer Gap, the answers seem to be: ‘now’ and ‘any’.
Gap is opening two stores in South Africa on Tuesday and Wednesday with wholesale partner Stuttafords in Johannesburg and Cape Town. And perhaps more adventurously, it plans to open in Lebanon, Georgia and Azerbaijan this year. Continue reading »
Quantifying the economic collateral damage from unrest in the Middle East might seem a grim task, but it’s not all bad news.
The spike in oil prices provoked by political upheaval has boosted the rate of GDP growth in the oil exporting Gulf Cooperation Council states to an estimated 6.5 per cent for 2011, according to a new regional economic report from the Institute of International Finance. For regional oil importers – many of whom are embroiled in political riots – the picture is less attractive: as a group they will see a fall in growth of 0.5 percentage points in 2011. Continue reading »
By Abigail Fielding-Smith in Beirut
With attention focused on another corner of the Arab world, it is easy to forget the political crisis in the Lebanon.
So a reminder from Moody’s on Monday that last week’s government collapse would hit the local economy is salutory. Moody’s warned economic growth may slow and bring losses at the country’s banks.
But investors aren’t panicking. Years of conflict has produced a remarkably resilient economy. And prudent policies have helped accumulate $30bn of foreign currency reserves – among the world’s largest on a per capita basis. Continue reading »
Lebanon is trying hard to limit the shock of the collapse of its government. Saad al-Hariri, the prime minister, was on Thursday asked to stay on as caretaker by president Michel Suleiman.
The government dissolved on Wednesday after 11 Hezbollah ministers resigned over a long-running investigation into the killing of Hariri’s father. According to Reuters, analysts are down-playing the possibility of armed conflict – which would pit a Syrian-backed Hezbollah against a US-backed Hariri. But in Beirut, nothing can be taken for granted.
Continue reading »
On Monday the FT publishes a special report on Lebanon, focusing on the challenges the country faces in regaining its status as the Middle East’s premier business hub after years of civil strife.
Lebanon’s economy has powered out of the economic crisis, growing on average 8.5 per cent from 2007 to 2009 on the back of international financial assistance and increased capital inflows. Yet political tensions remain as high as ever, as the pro-western coalition government grapples for power with a Syria-backed opposition dominated by the Shia group Hizbollah. Continue reading »
By Thomas Williams of mergermarket
Lebanon’s banking sector has grown to 30 per cent of the country’s GDP and, in the IMF’s words, “weathered recent regional and global crises well”. With margins slimming at home, its next trick should be deeper regional integration.
To that end, today’s move doesn’t see a Lebanese bank shopping abroad, but rather Egypt’s largest investment bank by market value, EFG Hermes, shopping in Lebanon. EFG has responded to the breakdown of its merger with one Lebanese bank – Bank Audi SAL-Audi Saradar Group, in which EFG sold its stake in January – by buying a smaller one, Credit Libanais. Continue reading »