Lebanon was the 72nd largest market for U.S. exports in 2016, according to U.S. Department of Commerce statistics. The Lebanese Customs Authority reported that Lebanon’s total imports in 2016 reached USD 18.705 billion, of which USD 1.184 billion came from the United States.
In 2016, the United States ranked as Lebanon’s third largest trading partner behind China and Italy. According to Lebanese Customs statistics, major U.S. exports to Lebanon were vehicles (USD 326 million), mineral fuel and oil (USD 237 million), products of chemical industries (USD 193 million), machinery and electrical instruments (USD 118 million), prepared foodstuffs, beverages and tobacco (USD 68 million), and vegetable products (USD 47 million).
Lebanon’s Central Bank Governor estimated GDP growth at two percent in 2016. Quoting the World Bank and the International Monetary Fund (IMF), he forecasts growth to reach two to three percent in 2017. Inflation was negative in 2016 and the IMF forecasts it to reach two percent in 2017.
Lebanon’s economy follows a laissez-faire model. The economy is highly dollarized and the average exchange rate is stable at 1507.5 Lebanese Pounds (LBP)to the U.S Dollar. The country has no restrictions on the movement of capital, capital gains, remittances, dividends, or the inflow and outflow of funds. The Lebanese government’s intervention in foreign trade is minimal.
Lebanon faces major financial challenges, notably a very high level of public debt and large external financing needs. The business climate will remain sensitive to domestic and regional political and security developments. Spillover from the Syrian crisis, including refugee inflows, will continue to impact public infrastructure and services, and growth, which is expected to remain below potential in the near term.
The U.S. Government has neither a bilateral investment treaty (BIT) with Lebanon nor an agreement on the avoidance of double taxation. The U.S. Government signed a Trade and Investment Framework Agreement (TIFA) with Lebanon in 2006. Since 1999, Lebanon has had observer status at the World Trade Organization (WTO), but has yet to accede to the organization. In 2002, Lebanon signed an association agreement with the European Union that entered into force in 2006.
Lebanon announced its commitment to join the Extractive Industries Transparency Initiatives (EITI), a global standard to promote transparency of the extractive sector. The standard requires annual data on licenses, contracts, beneficial ownership, payments, revenues and production.
There are many good reasons for U.S. companies to export to Lebanon. Lebanese consumers are fond of U.S. products, given their high quality and competitive price. English is widely spoken in the business community and many Lebanese have personal experience in the U.S., either through education or work experience. Lebanon has a developed banking sector. Payments for business transactions are often made in U.S. dollars, and nearly all Lebanese banks have American correspondent banking relationships that facilitate financial transactions between U.S. exporters and Lebanese importers.
Back to top
The procedures for business entry, operation, and exit are not streamlined and are plagued by excessive regulation. However, the process does not discriminate against foreign investors. Despite this, the World Bank’s 2017 Doing Business report notes that it takes entrepreneurs 15 days to start a business in Lebanon, compared to the average of 20.2 days in the MENA region.
According to the 2016 Transparency International’s (TI) Corruption Perception Index (CPI), Lebanon ranked 136 out of 176 countries worldwide, making Lebanon among the 50 most corrupt countries in the world. Foreign and local companies have complained about impediments such as corruption, red tape, arbitrary licensing decisions, complex customs procedures, outdated legislation, an ineffectual judicial system, high taxes and fees, high telecommunication charges and slow internet speeds, poor power provision, inconsistent interpretation of laws, and inadequate protection of intellectual property.
Lebanon adheres to the Arab League boycott of Israel. Enforcement is selective, as many goods on the boycott list are available in the Lebanese market. The Arab League’s Central Boycott Office maintains a blacklist of U.S. firms that are believed to contribute to Israel’s military or economic development. As per U.S anti-boycott regulations, U.S. companies must refrain from certifying that their products do not come from Israel. If there appears to be any request that might be in support of boycotts, companies should contact the Bureau of Industrial Security (BIS) in the U.S. Department of Commerce.
The Council for Development and Reconstruction (CDR) is the Lebanese government’s executive body responsible for tendering major projects, procuring financing for these projects, and supervising their execution. Major projects exist in transportation, electricity, telecommunications, education, solid and water waste. These projects are listed on the website.
Significant investment opportunities for international companies exist in the energy, water and wastewater, oil and gas, safety and security, franchising, Information and Communications Technology (ICT), and healthcare sectors. More information about electricity and water projects can be found on the website. More information about Lebanon’s franchising sector can be found on the website.
The Ministry of Energy and Water (MoEW) and the Petroleum Administration (PA) are seriously pursuing onshore and offshore hydrocarbon development. The U.S. Geological Survey estimated in 2010 a mean of 122 tcf of natural gas and a mean of 1.7 billion barrels of oil in the Levant Basin, which includes waters shared by Lebanon, Israel, Syria and Cyprus. To date, about 16,000 square km, over 70% of Lebanon’s total offshore area, has been covered by a 3D seismic survey, and most recent estimates indicate a 50% probability that 45% of Lebanon’s Exclusive Economic Zone (EEZ) contains 96 trillion cubic feet (tcf) of natural gas and 850 ml barrels of oil. U.S. company Neos Geosystems, which signed a contract with the MoEW in January 2014, performed an airborne onshore survey of the subsurface of the northern part of Lebanon, to help better understand hydrocarbon prospects onshore. In 2015, the PA contracted U.S. law firm Cleary Gottleb Steen and Hamilton as its consultant for the first bid licensing round and contract negotiation. In June 2017, Norway renewed the Oil for Development program in Lebanon for capacity building and technical support for 2018-2020.
Despite a maritime border delineation dispute between Lebanon and Israel of over some 860 square km, the MoEW launched the country’s first offshore licensing round on April 30, 2013, but has had to postpone the bid deadline several times until the Cabinet endorsed two decrees – one a model Production Sharing Agreement and the other the delineation of the ten offshore blocks -- required for the licensing round to be able to proceed on January 4, 2017. On January 26, 2017, the MoEW launched the first offshore licensing round with the bid deadline set for September 15, 2017, and the contract award by the end of the year. Moreover, it opened a second prequalification round, which raised to 51 the total number of prequalified - international oil companies (IOCs), of which 13 IOCs prequalified as Operators and 38 as Non-operators.
The PA has completed the first phase of its hydrocarbon strategy for the future of Lebanon’s offshore gas, and is now working on the ripple effect on the economy of any offshore discovery. It has completed a draft onshore exploration law currently under study within a ministerial committee. A Petroleum Tax law is expected to be endorsed by Parliament this summer.
Significant potential opportunities for U.S. oil companies exist in Lebanon’s offshore and onshore oil and gas exploration. Moreover, there are tremendous opportunities in related sectors since the MoEW plans to have most of Lebanon’s energy supply come from conventional sources of energy, mostly gas, by 2020. It also wishes to expand the usage of gas to industries and commercial and residential premises. U.S. firms are well positioned to participate in the field of upgrading Lebanon’s power plants to operate on natural gas, the construction of an LNG pipeline along the coast from northern to southern Lebanon with, subsequently, extensions to reach businesses and residential entities, and the development of terminals and storage facilities.
More information about Lebanon’s oil and gas opportunities can be found on the website.
U.S. companies interested in doing business in Lebanon are advised to hire a Lebanese agent or distributor. Although working through an agent is common practice in Lebanon, networking and lengthy investigation are key to finding an appropriate one.
U.S. companies do not need to visit Lebanon to find an agent. The U.S. Commercial Service can help U.S. companies find the right partner through the International Partner Search (IPS) service. Information is available on the website.
The Investment Development Authority of Lebanon (IDAL), a public agency responsible for promoting investments in Lebanon, has a “One-Stop Shop” service to issue permits and licenses for investors. More information is available on the website.
Notice to Visitors!
The link you have chosen will take you to a non-U.S. Government website.
If the page does not appear in 5 seconds, please click this: outside web site
Export.gov is managed by the International Trade Administration and
external links are covered by its website disclaimer statement.
BuyUSA.gov is managed by the International Trade Administration and
external links are covered by its website disclaimer statement.