Buffeted by crises at home and abroad, the Lebanese economy stuttered in 2012 and closed the year unsteadily. Many laws currently stuck in the processes of government could possibly bolster the country’s business environment and right the ship, but problems abound in passing them through Parliament, let alone their implementation. Executive met with Minister of Economy and Trade, Nicolas Nahas to talk about how he assesses the impasse.
Lebanon has a very high prevalence of market-distorting oligopolies. Why have you not enacted the anti-trust legislation and competition laws?
This law has been drafted and sent to the Parliament. Unfortunately the competition law is one of the 69 laws around which there is a kind of political debate. They were made during Siniora’s term. Now there is a constitutional debate about how to enact these laws and I hope that can be resolved soon.
These laws will challenge a lot of vested interests among the political and business elite. Is this not the real reason they are not progressing?
You are insinuating there is some lobbying against these laws but I don’t think that is the case here. The law has been drafted and it is on the way. The delay is because of a constitutional debate.
I don’t see how there is a problem with the constitution…
Mr. Siniora’s term has been challenged as unconstitutional by some political parties. Anything that came out of that government is in limbo.
His opponents are in government now. Surely you can push them forward and get them enacted?
This is about a debate among all the different political parties but I think we have reached a kind of agreement on that.
Why aren’t Lebanon’s intellectual property laws properly implemented?
I don’t think they are weakly implemented. I think we are implementing them to the extent of the law.
Many reports and studies including the World Economic Forum’s Global Competitiveness Index suggest otherwise…
It is not just about implementation, but the law itself needs to be revisited and updated. This is going to happen but it is stuck on the same track as the competition laws. There are four laws, which by the World Trade Organization’s (WTO) standards we have to adopt and they are on the same track I mentioned.
It seems Lebanon is just paying lip service to the idea of ascension to the WTO…
Lebanon is committed and we have perhaps finished 90 percent of what is needed but we need to complete these four laws and then we can apply to the WTO.
How much have you been able to achieve in empowering the insurance sector and has it been enough?
It is never enough. We have a very challenging time with the insurance sector and we are trying to bring rules and regulations that vitalize the sector and upgrade the kind of service this industry is giving. This sector is very solid and has huge potential for growth. We hope by next year we can have discussions on a new law that will give more power and capacity to the body that regulates this sector.
The new traffic safety law mandates obligatory third party liability insurance for material damage, but is not able to override the archaic insurance law. Could this be an incentive to finally update the law?
I think they are separate issues. I think the new law under preparation for the insurance sector will take into consideration what has been provided in the traffic law. This law is blocked like the others.
So you’re saying as long as Lebanon is stuck in this political impasse none of these laws will be passed?
Yes, unfortunately so.
You were on the committee that brokered the food safety law. There is an overlap of prerogatives between the Ministry of Agriculture, your ministry and the Ministry of Health, so what actual power will the new food safety authority have?
There is a lack of regulation and law in the food safety sector. There has been a draft law in the parliament for the past four years and in this law the authorities and responsibilities are very mixed. This government has taken back this law and redrafted it. In this new version we are trying to delineate the responsibility of each ministry and each administration. The way the farming is done is under the Ministry of Agriculture, the processing under the Ministry of Industry and the food service and food access to market will be under the new authority.
Considering the budget was stripped of any meaningful reform or progressive measures and is now stuck in the parliament, can its passing be considered any kind of success?
It is not a matter of success, it is a matter of duty. It is something we have to do and we have, and now it is at the parliament.
Isn’t the most important thing that the slate is swept clean from previous spending so we know at least what basis we are starting at?
These are not related. You make a budget and send it to Parliament and then sort out the backlog of the past. We have sent, I think, most of the accounts from 2007 to 2010 to the legal authorities to have a say and then send it back to the parliament. We can’t stop the government because of the backlog of the past.
High operating costs are one of the biggest burdens on Lebanese producers. How do you react to critical sectors, such as electricity, being kicked around like a political football and so irresponsibly handled?
Is it being responsibly handled?
Yes, we have endorsed the vision and the plan of the past government so as to not waste time on arguing on different options. It is under implementation and is the only government that has gone to implementation. Is it my best option? No, but rather than arguing, we acknowledge implementation is the most important step.
Reliable data on Lebanon’s economy are scarce and insufficient. What is being done to address this?
We need a master plan and we need the national accounts on regular terms and clear terms so we can assess our economy on reliable figures, trends and criteria. This is an important place where real change needs to happen.
Lebanon is way behind its potential for e-commerce. What is the situation with the long-awaited e-commerce laws?
These have been drafted and finished and have been agreed on by the Council of Ministers and now are on the way to Parliament. They will be on their desk very soon.
What can you cite as your main achievements while in office?
We are trying to see that most of the economic decisions are taken in a sane logic and create a more business-friendly environment, and to enhance [small and medium-sized enterprises] in Lebanon. We are working on multiple issues regarding basic laws such as food safety, e-commerce and commercial law. We want to bring strategic thinking toward the 20-20 vision, but time has not been enough for us to build this so far. Finally, we are launching web services for the customer. Now the trademark will be online and this is the first step in bringing most of the [Internet protocols] into a direct web service for the customer and the client and will [add to] the kind of service we are giving to the citizen.