Vrej Sabounjian is perhaps the most positive person in Lebanon. Despite worsening security conditions, a refugee influx and a stagnant economy the country’s caretaker minister of industry is convinced that there are plenty of opportunities — companies just need to find them. Executive met with him to discuss his record in 2013.
When this government was formed, you promised to be the most pro-industry government in Lebanon’s history. Have you failed?
I have succeeded. The government was not saying that we were going to be 100 percent pro-industry. I think governments should have balanced policies with all the sectors — industry, services, tourism, etc.
As far as industrial policy, I think we have done well and I would thank all my [ministerial] colleagues and the prime minister and president. We can say that after two and a half years the Lebanese industrialist has achieved a lot of things, but of course there are some things we could not do yet — especially because in the last six or seven months we have not had all the powers of execution. So that is a minus, not a plus. But we have done a lot of things.
What specific successes are you proud of?
I don’t want to specify what I am proud of and what I am not proud of. For me as long as it is a service for the Lebanese, it is my priority. Some services help big industries, some help smaller industries — neither is necessarily more important for me.
Secondly I don’t like to brag and say, “I did this,” and “I did that.” There is a very long list of what we did — maybe one day we will publish it. But I don’t want to brag while I am in the post that “this is what I did.”
You still have not been able to implement the cut in export VAT from 15 to 7.5 percent?
It has been in the parliament for seven or eight months. I hope one day they meet again and finalize this law. But other than that there are many, many things we have done — for example the [establishment of the National] Wine Institute and the obligation of manufacturers to have three kinds of insurance. This allows safety for the employees and for all the neighbors.
What about plans to encourage the United Nations to only buy Lebanese goods when supporting refugees?
We are working on that plan with the UN. We have been meeting with them to urge them to spend their money in our country. We have opened our doors to our Syrian neighbors who are temporarily here. I want them [donors] to spend their money here by first giving priority to whatever we manufacture in this country and, secondly, if it is not available in this country, the Lebanese merchants can import for them. But it has to go through Lebanese businesspeople.
Have the UN accepted this yet?
This policy is not implemented. There is no policy.
Could Lebanese industrialists cope with the scale of the demands?
Of course. We are capable and we are willing to be capable. Once we finalize the plan we will have an office so that small companies can go and register so that when there is a tender they can participate and we can support them with the paper work. We are able to give [the UN] whatever they need — supplies, food, water, clothing. Whatever they need.
You would be in favor of making this legal so that they would only be able to get resources from Lebanese companies?
Not only in favor. I am convinced this is our right. We have one and a half million refugees in our country and I hope all the donor countries think this way.
The industrial zones were in the government’s mission statement. They are no longer realistic and private sector leaders are planning to establish them without government support.
This industrial zone is an idea and I don’t say I don’t like it, it is fine…
…but you are not fully in favor of it?
I am in favor but this should not be a reason for us to say, “Well we don’t have an industrial zone we are not doing good business.” I want to say, “If you want to do industry, do it wherever you want and I am with you. Wherever you have a piece of property, do it, invest in it and the minister will help you.”
So you will support a privately run industrial zone?
If they have land they want to [develop] I am willing to help them as well. But I am not going to ask the people that have their factories somewhere for the last twenty years to close their places and go there — this is not going to happen. I don’t favor this at all.
That is not what they are arguing for, they are arguing for government support for these zones similar to tax breaks you see in other countries…
I don’t think the Lebanese people need more tax breaks. We are one of the lowest countries, we are paying 15 percent tax — that is all. The lowest advanced capitalist countries are 35 percent, France is 75 percent [at the top rate of tax]. We are 15 percent and they are still saying they don’t want to be taxed? This is one of the lowest taxes. Let them think about how we can produce better, faster and in alternative ways.
Is it fair to say accession to the World Trade Organization is not realistically going to happen in 2014?
I don’t know about that. Maybe we should ask about the World Trade Organization — I am with open markets and equal opportunities for all. But the same rules apply for a country with a population of 90 million and a country of 4 million? If we are a small country we are always under regulation from larger countries. I disapprove of that. I think there should be exemptions. The WTO is a good thing but I think there should be some precautions and protections [based on] understanding the real situation of every country.
Why has Lebanon not been able to attract more Syrian industrialists fleeing their country?
I don’t think we did not attract. We have said many times we are ready to help if anybody wants to invest. It is a matter of choice where they go — it doesn’t mean we are against their investments. On the contrary we are with their investments. But if they don’t want, they are welcome. Many industrialists visited me, I showed them ways they can invest and they were very happy. But it is their choice — we cannot say, “No, you have to invest here.”
Were you disappointed not to attract more?
Not at all. Why should we be disappointed?
Industrialists complain that the minister of agriculture is able to attract more support for his policies than you are as he comes from Hezbollah. Have you had the full backing of the rest of the government?
As I said, I thank all the ministers. Whenever I need it I have the support. If not 100 percent — that is not possible with any minister. Not every minister can get the support for everything he wants, but mostly whatever I needed, I got the support. It had nothing to do with my background or who was supporting me.
How confident are you for Lebanese industry in 2014?
I would say that there will be great opportunities in Lebanon in 2014. There will be a lot of things for sale. Some businesses will close down, some will open up — but there will be opportunities. I think they should look at opportunities in 2014 and beyond.