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Economics & Policy

What does $3 billion buy these days?

by Joe Dyke February 5, 2014
written by Joe Dyke

Lebanon’s president could barely contain his joy. Speaking only a few days after Christmas, Michel Sleiman announced a late present to the Lebanese in a year that had brought little to celebrate. Speaking live on the major television networks Sleiman announced that Saudi Arabia had agreed to invest in the Lebanese army to the tune of $3 billion, a grant that he said would enable the military to “strengthen its capabilities” and “confront terrorists.” Coming only two days after the killing of a pro-Saudi former minister, the president’s message seemed fairly pointed.

The grant could undoubtedly have a major effect on the capacity of the Lebanese Armed Forces (LAF). $3 billion, spread over five years, would be a major boost to Lebanon’s defense budget, which the Stockholm International Peace Research Institute in 2012 estimated at $1.7 billion annually. If invested wisely, the fighting capacity of the military could greatly improve, as could its ability to control its borders.

 

Editorial: Saudi grant to Lebanon deserves cautious welcome

The investment is certainly needed. Currently, despite having over 60,000 soldiers, the LAF has only a token air force, relies heavily on Russian-made tanks from the 1960s and has a minimal navy. New hardware could enable the LAF to carry out its duties far more efficiently. Elias Ferhat, a former Lebanese general, cites the case of the Nahr al-Bared Palestinian camp in 2007 — when the Lebanese army took three and a half months to crush an insurgency led by Islamist groups. “Had the Lebanese had any fixed wings [planes or drones] it could have ended it in 15 days or fewer,” he said.

Yet those expecting this to be a game-changing moment which will allow the Lebanese army to justify disarming Hezbollah and even provide a military counterweight to Israel may be disappointed. Closer inspection of the deal indicates that while the benefits may be significant for the army’s capacity to control security internally, it is doubtful whether it will have a major effect on relations with Israel or Hezbollah.
Regional deal

Part of the reason the deal’s impact is unclear is that while the proclamations were bold, the details remain murky. As this magazine went to print, there had been no official confirmation of the $3 billion from either the Lebanese government, the Ministry of Defense or the LAF. Beyond the president’s statement, there are as yet no further details of where the money will go. “All we have so far is the declaration from the Saudi government and an acceptance from the Lebanese president,” said Farhat, cautioning that Saudi has a long history of promising money, “but when it comes to execution they do nothing. So it is too early to know how big [the effect will be].”

In fact, closer inspection of the deal suggests that it may have more to do with relations between Saudi Arabia and France than a sudden desire to support Lebanon’s military. At a regional level, as the United States has moved closer to rapprochement with Iran, Saudi Arabia — for many years America’s closest Arab ally — has appeared increasingly snubbed. In November, Riyadh surprised the world by turning down a seat on the United Nations Security Council after months of lobbying for it, a U-turn widely interpreted as a message to the US.

As relations with Washington have soured, leaders in Riyadh have been looking for new allies, with the French appearing to be the favored choice. They may well be voting with their wallets, with the two countries believed to be on the cusp of confirming a $1.4 billion deal to overhaul the Saudi navy — specifically the French-built F-2000 frigates.

The deal struck between Riyadh and Beirut is in fact a triangular one. Lebanon will not be allowed to invest the $3 billion however it sees fit, but will have to buy French goods and get training from France. This, said Aram Nerguizian — a senior fellow at the Washington-based Center for Strategic and International Studies and an expert on the LAF — indicates that the deal is as much about Paris as Beirut. “The deal benefits the French [weapons] industry first and foremost. No funding will be transferred directly to Lebanon and the mechanisms by which orders, payments and deliveries will play out are likely to be triangular and complicated by domestic constraints and pressures in all three countries concerned. Minimizing these pressures is incumbent upon effective trilateral engagement, not unlike recent LAF meetings in Paris and Riyadh.”

Indeed Nerguizian believes the Lebanese Armed Forces had only partial awareness of the deal before it was announced. “The LAF was consulted by the Lebanese president on its military development objectives and the Capabilities Development Plan, but they were not aware of any plan by Saudi Arabia to finance the sale of French systems, sustainment and training to the Lebanese,” he said.

What to buy

The debate around what the military should buy, therefore, is somewhat muddied as it is not yet clear by what mechanism the weapons will be selected. Will the LAF be able to prioritize areas where it feels it needs development or will the French dictate what they wish to sell?

Even if the LAF is in control, there are likely to be internal disputes over where the money should be allocated. Nerguizian points out that French naval expertise are among the world’s best and that Lebanon should seek to benefit from this. “This is not only a focus on acquiring ships. It is a bottom up effort to reshape an atrophied force of some 2,400 into a proper navy able to conduct patrol and interdiction in Lebanese territorial and economic waters. This would include dry docks, floating dry dock, ship-to-shore communications and other systems to supplement the sale of ship systems able to operate in difficult weather conditions.” Former general Ferhat, however, thinks the navy is less of a priority. “We need an air force because we don’t have a real one in Lebanon. We need also main battle tanks as our tanks are Syrian Russian-made tanks from the 60s,” he said. “These should be our priorities.”

Another potential tension may be over the percentage of the money spent on new goods. The Oxford Companion to American Military History points out that on average the cost of maintaining hardware over its lifetime is more than the initial cost of buying it.

It is as yet unclear what percentage of the $3 billion will be spent on new items and what will be allocated to maintain them. To give French industry the most short-term benefit, the focus would be on new items, but this could leave the LAF unable to foot the bill. “The maintenance of these weapons will cost hundreds of millions of dollars a year and the Lebanese budget cannot afford this,” Ferhat said. “We have a choice — can we acquire these weapons and maintain them or will they stay in a hangar for 12-15 years and then sold to countries such as Pakistan as they can afford to maintain them?”

Nerguizian believes the Lebanese army will push for finances to be allocated towards long-term acquisition. “The LAF is not looking to acquire $3 billion-worth of systems it cannot sustain… The LAF is operating under the premise that, if the $3 billion does in fact materialize, at least part of it must and will focus on sustainment.”

The need for clarity

One final element stressed by much of the media in understanding this deal is Saudi Arabia’s desire to influence Lebanese politics by weakening Hezbollah, which is the closest regional ally of Riyadh’s rival Iran. But again, the effect may be more modest than some have predicted.

If the purpose of the grant was to develop the LAF so that Hezbollah would no longer need to be armed, then it appears more than $3 billion is needed. Adnan Mansour, the caretaker foreign minister who is close to Hezbollah, dismissed the donation as “not enough to bolster Lebanon’s defense system,” pointing to the $17 billion Israeli annual defense budget. The extent of Hezbollah’s financial support from Iran and other donors is not known, but the Washington Institute for Near East Policy estimated it could be up to $200 million a year. Similarly the party has a huge network of voluntary donors, who pledge support to the party. While their total budget is significantly less than the LAF’s budget, Hezbollah has fewer responsibilities — with ‘resistance’ to Israel still its top priority. In this the party’s expert use of guerilla warfare has made it more capable of challenging Israeli aggression than traditional Middle Eastern militaries. “The Army is currently not able to be strong without [Hezbollah] at its side,” Mansour added.

Nerguizian agrees that the triangular nature of the deal makes it unlikely to be a direct challenge to Hezbollah. “$3 billion to France which will then sell as yet uncertain aid to the LAF will not lead to an LAF-Hezbollah confrontation, nor will it lead to the kinds of government formation that will seek to exclude the Shi’a and Hezbollah.”

What remains are more questions than answers. While the money from Saudi could have a transformative effect on the capacity of Lebanon’s armed forces, whether it actually will or not is unclear. The sooner more details are released, the better.

February 5, 2014 0 comments
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Economics & Policy

Can Bassil go it alone?

by Jeremy Arbid February 5, 2014
written by Jeremy Arbid

On January 8, caretaker Minister of Energy and Water Gebran Bassil again delayed the first licensing round for offshore oil and gas exploration ­— perhaps the biggest hope for Lebanon’s static economy. The reason was the same as the two previous times it had been delayed since September — two decrees need to be signed to allow the round to move forward. Political infighting has prevented the cabinet meeting to do so, thus Bassil has been forced to keep pushing back the bid.

But while this was old ground, this time there was a twist. Setting a new date of April 10, Bassil was adamant that “the [new] deadline is a final one.” He did not specify exactly what he meant by this, but this ambiguity has led some to interpret that if a cabinet has not been formed by April the minister will attempt to push through a move without the necessary decrees.

How far he could get without full cabinet approval is unclear. He certainly could not finalize any deal, as Lebanon’s 2010 Offshore Petroleum Law explicitly declares that any final agreement must be passed by decree. This procedure is supported by Article 89 in the Lebanese constitution which states: “No contract or concession for the exploitation of the natural resources of the country… may be granted except by virtue of a law and for a limited period.” Carole Nakhle, an energy economist at the Surrey Energy Economics Centre, explained, “the Offshore Petroleum [Resources] Law plainly states that the decrees should be approved by the Council of Ministers.”

What Bassil could do, however, is start to negotiate with companies on the basis of the model Exploration and Production Agreement (EPA). One of the two pending decrees declares the terms for the final EPA — the agreement between oil and gas companies and the government. But while the terms are not finalized, Bassil can begin negotiations working on the assumption that the model will form the basis for the final EPA.

An industry source, speaking on the condition of anonymity, said, “You can actually move along, and indeed it is common in resource-rich countries for terms to be agreed before formal regulations are passed approving these terms.” But, he stressed, companies will be reticent unless they are given assurances “that these are the final terms and that there won’t be a complete redraft.”

Dangerous precedent

Experts warn that moving forward without the decrees and the cabinet’s blessing is a precarious move. Oil companies are aware of the risk of investing in Lebanon’s offshore gas. However, as Mona Sukkarieh — co-founder of Middle East Strategic Perspectives, a Beirut-based political risk consultancy specializing in oil and gas — explained, “companies don’t like to operate on shaky legal grounds if their rights and licenses run the risk of being questioned at a later stage.”

These repeated delays continue to frustrate participating companies, particularly the largest companies in the bid, many of whom had only a skeleton presence at the Lebanon International Oil and Gas Summit in December.

However, these companies have experience operating in unstable political environments and have calculated Lebanon’s country risk into their strategic plans. A company’s decision to participate in a licensing round “is a strategic decision that is not reconsidered if a tender is temporarily delayed. Of course, this does not mean that the Lebanese government should keep testing their patience,” Sukkarieh explained.

The need for speed

In many ways Bassil is correct in demanding a final deadline — time is a factor for at least two reasons. In the face of political negotiations, the projected year in which Lebanon is supposed to become a gas producer, 2020, will surely be pushed back. By the next decade new sources of gas will be available in the global market. Israel has already started gas production and rumors of a proposed pipeline to Jordan are circulating. Globally, the United States, Australia, India, Canada and Indonesia are set for big increases in gas production, while regionally both Iran and Qatar are due to expand their output rapidly.

AT Kearney, a global management consulting firm, is forecasting that over the next decade, the surplus of supply will cause gas prices to fall. One of their primary indicators is gas import infrastructure, which is undergoing rapid expansion for both pipeline and liquefied natural gas, with much of this growth occurring in the Middle East. The World Bank expects prices in Europe and Asia to fall by around 10 percent in the next decade while the International Energy Agency anticipates a 30 percent decline in prices by 2020.

All this means that by the time Lebanon starts extracting, gas reserves lying offshore may not be as valuable as they are currently estimated. Thus the sooner Lebanon moves forward, the better.

The old enemy

The second reason that time is key involves the maritime border dispute with Israel over 873,000 square kilometers believed to be rich in resources.

The United States has been an active partner in resolving the border dispute, with multiple visits by high-ranking American officials. US Deputy Assistant Secretary for Energy Diplomacy Amos Hochstein visited Lebanon in November 2013 to push for a deal, meeting with several leading political officials including caretaker Prime Minister Najib Mikati, Speaker of the Parliament Nabih Berri and Bassil.

By some accounts Hochstein proposed a compromise for the dispute during his visit. According to a recently published news release by Alem & Associates, a legal firm representing oil companies bidding in the licensing round, the proposal “consists of setting a maritime blue line area between both countries in which the disputed zones will remain unexploited.” In general, the proposal prescribes freezing any exploration and exploitation activity in the disputed area until a permanent solution can be found.

But Lebanon’s political infighting may be strengthening the Israeli government’s position. Reports from Israel have indicated that Tel Aviv has rejected the compromise put forward by the Americans, perhaps a sign that Israeli leaders are feeling increasingly confident in the face of the Lebanese government’s inaction. Similarly the Israelis have a new gas exploratory site, the Karish well, with reserves estimated at up to 2 trillion cubic feet, approximately 20 kilometers south of Lebanon’s border claims.

It’s another promising find for the Israelis, who grow more concerned about their ability to protect offshore gas installations. In fact, the Israel Defense Force (IDF) is requesting nearly a billion dollars to fund operational costs for large patrol vessels, extended surveillance and intelligence capabilities, and unmanned aerial vehicles (UAVs). This allocation would be in addition to the recent acquisition of two state of the art German frigates that are bound for patrol of their Exclusive Economic Zone waters.

Each passing day provides less incentive for mediators such as Hochstein to help Lebanon retain its territorial waters — enabling Israel to move closer toward claiming parts of the disputed zone. As Malek Takieddine, an oil and gas lawyer representing companies preparing to bid in Lebanon’s first licensing round, explained, “You might see Israel granting licenses or permitting certain operations near or inside the territories claimed by Lebanon. If this occurs, it might be also coupled by military protection.”

Moving Forward

Those wishing to move Lebanon’s oil and gas sector forward are faced with two unenviable options — back the caretaker energy minister to move ahead without the support of the government, or wait for the formation of a new government. On the latter, there have been a few positive signs in recent weeks that suggest the wait may be coming to an end.

Despite the continued delays and political bickering surrounding the petroleum file, technical work at the Ministry of Energy and Water and the Petroleum Administration (PA) continues. The PA — the six-member body charged with running Lebanon’s oil and gas sector — has recently drafted both an Onshore Petroleum Law and a Petroleum Tax Law, posted advertisements for employment opportunities, begun soliciting tenders for the next government-backed oil and gas conference, and has been coordinating a series of roundtable discussions and dialogues with local policy experts. According to Nakhle the PA has performed its duties with a level of professionalism not typical to Lebanese bureaucracy. “Various departments in other relevant ministries, like finance, environment and economy, should also be working at the same speed and getting themselves ready,” she added. Perhaps this new efficiency could start with the formation of a new government. Then the country could move forward in the right way.

February 5, 2014 1 comment
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Finance

The right kind of business

by Thomas Schellen February 5, 2014
written by Thomas Schellen

Two niche markets are driving the business and growth of Jammal Trust Bank (JTB) at the start of 2014. One is in the bank’s home base in Lebanon and the other in West Africa. This diversification is not bad for a medium-sized lender that feels very comfortable being a mid-sized operator with just under $1 billion in assets — but what is surprising is that these two niches are at first sight entirely unconnected and even appear to represent opposite poles of core banking competencies.

In Africa, JTB’s market comprises primarily the expatriate Lebanese business community “in every country that borders the Atlantic starting from Angola and all the way up to Dakar [Senegal]. We are present in these countries in the sense that we have clients there who are basically larger-end clients,” says Anwar Jammal, JTB’s chairman and general manager.
In Lebanon, his clientele is far from big-ticket accounts and corporate transactions. Here, Jammal describes himself as banker of the small and medium enterprise (SME) clientele and JTB as a specialist bank in the much-neglected business of micro-lending, which not only in Lebanon is of no particular interest to the biggest banks. “We cater to SMEs and micro-businesses and in fact were the first bank to initiate micro-lending in Lebanon back in 1999,” he says, differentiating microcredit from small consumer loans by its purpose.

best of both worlds
The common denominator behind the opposing specializations is market knowledge. With most members of his generation in the Jammal family born as Lebanese expatriates in Africa, he claims to have an edge over other Beirut-based banks that approach the market as outsiders.

In the domestic market, JTB nurtured its role to be the “people’s bank” and has developed its expertise in the behavior of small customers ever since conducting a study finding that 50 to 60 percent of the bankable Lebanese population did not bank with anyone. From this study, which according to Jammal was done more than 10 years prior, JTB concluded that it would not try to chase a very small slice of the Lebanese market for large corporate accounts but rather focus on cultivating a clientele among the unbanked population and specifically target those 30 to 35 percent of bankable Lebanese citizens who thought that no bank would be interested to take them on as clients.

The strategy of the two niches has rewarded JTB nicely, with appreciable growth in the past few years. Partial banking sector figures for 2013 up to the month of November have shown JTB with growth across key indicators: seen year-on-year, assets expanded 27.4 percent, deposits grew 20.5 percent and lending increased by just under 27 percent. Net profits shot up tremendously, by 182 percent, but this has to be attributed to a large drop in exceptional expenses from the same period in the previous year, Jammal tells Executive.

While full-year results for the Lebanese banking sector in 2013 were not yet available at the time of the interview with JTB, last year’s partial sector results retrospectively provide a nice frame for the bank’s 50th anniversary near the end of last year. In a wider look over JTB’s financial evolution over the period since Anwar Jammal assumed the bank’s chairmanship in May 2005, growth rates showed broad strength. “Our average yearly growth of loans from 2005 till last year is 19.4 percent, average growth of total assets is just under 11 percent and the average growth of deposits is about 13.4 percent,” he says, adding that this pace of development allowed JTB to move its ranking by size of assets up by about 10 positions since 2005, to 23rd or 24th place in the sector.

Notwithstanding the growth rates that JTB recorded since he assumed the chairmanship in family succession, Jammal insists that he made no fundamental changes. “I can’t say that I have done anything innovative. We basically streamlined ourselves and focused ourselves on our core banking business. We tried not to be anything other than what we are: a medium-sized bank and we cater to the SMEs of Lebanon.”

He appears, however, to be prone to understatement in a very British way. Moreover, besides its dual market focus there is a second combination of seeming contradictions in JTB’s corporate DNA that is linked to his chairmanship. Jammal is not only the bank’s chairman and general manager; he also is its controlling shareholder since 2005. But while this combination is as close to operational omnipotence as it can get for a banker, the heir of JTB explains that he instead created a new governance structure with a board whose members, apart from him, hold no executive positions in the bank.

“I gave full power to the board, believe it or not. When I took over the bank, the powers that the chairman general manager actually had were frightening. I said to myself we either come out of this particular cycle to have a professional institution or maintain a small family-run business mindset. The first decision was that we want to go into being a professional institution, so I rescinded most of the authorities that I had and gave to the board,” Jammal explains.

Looking forward to the coming years, he foresees no diminishing of demand for credit in Africa and expects that the bank’s lending growth abroad will be curtailed by central bank-set limits for lending in countries with lower sovereign ratings long before any slackening of demand from borrowers.

Demand from SME borrowers and micro-credit applicants in Lebanon is also not going to wane in Jammal’s expectation and he assesses this market segment as less likely than others to be impacted by the continuing economic challenges related to the Syrian crisis.
SME lending constitutes the bank’s most important domestic credit activity, with a total amount of LL74 billion ($49 million) in lending to SMEs in 2012, followed by housing loans at LL69 billion ($46 million) and corporate loans at LL67 billion ($45 million) and SME loans were also the fastest growing loan segment between 2011 and 2012, displaying a year-on-year growth of over 60 percent from LL46 billion ($30.5 million) in 2011.

just the right size
While Jammal says that micro-lending is actually less risky than consumer lending in terms of default, he concedes that dealing with this clientele, many of whom have never banked before, makes the credit business much more labor intensive, which is reflected in higher interest rates. While reluctant to divulge the premium in interest rates that his bank charges over common market rates in Lebanon, the JTB chairman is adamant to compare the bank’s loan offers to those of non-banking money lenders. He emphasizes that prior to JTB’s focusing on micro-lending, small borrowers had no alternative to dealing with loan sharks and their extortive interest charges.

For developing the micro-credit and SME credit business of JTB, Jammal says the bank has a strategy to lower costs by automating and streamlining delivery and at the same time attracting more borrowers. He adds that this two-pronged approach is supported by risk assessment processes that the bank has developed on the basis of its experience with borrowers and which enable the bank to calculate credit scores in the profiling of loan applicants.

While he is decidedly working for growing the business of JTB — and in the long term aims to dilute the family aspect in the bank’s shareholder base by bringing in new shareholders — Anwar Jammal is one Lebanese banker who wants to profitably remain situated in the upper tiers of the beta banks (with deposits between $500 million and $2 billion). To him, going alpha would mean losing the bank’s competitive edge. “For as long as I am chairman, I certainly don’t want JTB to be one of the top 10 banks in Lebanon,” he says.

February 5, 2014 0 comments
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Finance

Jad Hatem – Q&A

by Executive Staff February 5, 2014
written by Executive Staff

Jad Hatem is a partner at B.E.C.A. Hatem & Partners, one of Lebanon’s leading accounting firms. The company has around 500 clients, many of whom are due to file taxes online for the first time ever in 2014, after the Lebanese government introduced the system at the end of 2013. In coordination with the Ministry of Finance, B.E.C.A. have been helping prepare their clients through specific training programs.

E   What companies have to pay their taxes online this year?
For the year 2014, all the large companies will submit online but the smaller companies still do hard copies. In the coming years all companies will be obliged to pay online. For now the larger companies are paying VAT, completed on a quarterly basis, annual tax income and real estate taxes online.

E   How significant a difference can online taxes make for both the government and the companies?
I would say it is going to be a win-win situation. For the taxpayer it will be much easier to submit it on the web directly rather than a hard copy to be completed, signed and submitted to LibanPost — with the fees attached. For the Ministry of Finance it will be much easier. In the past they used to get hard copies from the LibanPost, scan it, enter the data into the system — now that won’t be necessary. So on both sides it will be beneficial.
Nevertheless, I am sure the first two years there will be complications — it is new, people don’t know how to do it, and there might be bugs in the system. Many accountants from an older generation are not familiar with IT and the internet. So it might be tough for them in the beginning but later on it will be much easier.

E   The government is aiming to get all companies to pay taxes online by 2015. Is that realistic?
It will be feasible as long as the large taxpayers’ scheme is successful this year. There is no reason why it can’t happen.

E   How well is the e-taxation system that was launched at the end of last year working?
We cannot judge yet, we don’t have feedback as the first quarter that has been submitted is this quarter. So the first test is now — the deadline was postponed till the end of January. It is too early to know. But what we can say so far is that people, companies and accountants are not well informed about how to proceed with this file.

E   So the potential problems are more to do with knowledge than the functioning of the system?
We don’t know yet how efficient the system will be but what we know at this stage is people are not aware how to do it. So we need to have workshops so taxpayers know how to succeed.

E   How have you been training your clients to avoid problems?
We carried out a three-hour briefing for over 100 of our clients to give them the knowledge to register online, get an access number, and complete the forms.
We had 140 attendees, all of them from our clients — the chief accountants.

E   Is three hours training enough to learn how to submit your tax forms online?
Yes, after three hours they should be able to register, to get online, to get the login and have 80 to 90 percent of the knowledge required to file their tax returns.

E   Are some businesses that you work with hesitant to go online?
There is hostility, mainly from the older generation, which has been doing it for decades. For them they don’t want to change but on the other hand it is not an option — this is how things are moving. Now those in big companies cannot do it offline any more, it is compulsory.

E   How many years behind is Lebanon in going online?
IT-wise and in terms of internet penetration, compared to Europe we are far behind. Lebanese are not very familiar — if you look at the statistics most of them are into social media but that is it, in terms of using the internet for e-payment, etc. Lebanese are still not used to paying for things online. But compared to other Arabic countries, excluding the UAE, we are not far behind.

E   Does auditing online make the system more transparent, thus potentially reducing corruption?
The information will be available much quicker, so as soon as you submit, the information will be available. In the past it was completed manually, then sent to the Ministry of Finance to be processed. All of this process took months but not any more. But the impact on transparency will be indirect.

February 5, 2014 0 comments
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The Buzz

Business briefing: 16 Jan 2014

by Executive Staff January 16, 2014
written by Executive Staff

Economics and Policy

Authorities in the UAE and Iran may have reached a tentative agreement to end a long-running dispute over three islands in the Gulf.

More from Arabian Business

 

The US Marine Corps says it is trying to determine the authenticity of images published by a celebrity gossip website that appear to show marines burning the bodies of dead Iraqis.

More from The BBC

 

Canada is considering limiting the rights of dual citizens who live outside the country or travel on a foreign passport, including not providing consular assistance.

More from Arabian Business

 

Companies and Business

Saudi Gulf Airlines, a new carrier born of the deregulation of Saudi Arabia's aviation market, has signed a $2 billion deal with Canada's Bombardier Inc to buy 16 CSeries jets with options for 10 more.

More from Reuters

 

The Basel III III requirements and fierce competition are leading to further consolidation in Lebanon’s banking sector, as several foreign-owned lenders move to sell their retail business in the country, experts agree.

More from The Daily Star

January 16, 2014 0 comments
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Economics & Policy

Lebanon’s futile stimulus package

by Joe Dyke January 14, 2014
written by Joe Dyke

When Riad Salameh, the governor of Banque du Liban (BDL), Lebanon’s central bank, announced in November $800 million for a new stimulus package to help the economy grow in 2014 — he was perhaps guilty of overstatement. While there will be $800 million made available, what Salameh neglected to mention was that $468 million of it was actually unused money from 2013’s stimulus package which will be rolled over. As such, just $332 million of purely new money will be extended, less than 1 percent of gross domestic product (GDP).

While Salameh was quick to stress that the primary reason for not releasing more money was fear of inflation, there are other factors that may have caused him to ease off. Put simply, the impact of the first stimulus package remains unclear, while the general weakness in the economy and low levels of confidence mean that the positive effect of any new round of stimulus is likely to be muted. In such a climate, and with the ongoing political impasse showing no signs of easing up, the governor is faced with the unenviable task of again shouldering the burden of moving the economy forward with limited tools.

Assessing success

In January last year BDL announced the details of its first monetary stimulus package since 2009, with a total of $1.47 billion being extended. The mechanism, as with most monetary stimulus packages, was indirect — BDL would extend loans at 1 percent to the country’s commercial banks, providing they lend to their customers at corresponding lower rates. Specific sectors were targeted, with real estate receiving 56 percent of the funds, environmentally-friendly projects 20 percent and the productive sectors just 14 percent. The cumulative effect of the package, it was hoped, would be to boost demand in the economy by helping thousands of Lebanese buy their first homes, open businesses or develop existing projects.

Assessing the efficacy of these policies has proved difficult. The bank has yet to release detailed numbers on the impact and, industry experts say, is unlikely to do so. “We need to see the detailed results of the first stimulus to have the full picture,” Nassib Ghobril, head of research at Byblos Bank, says. “BDL doesn’t publish those but often the governor [Salameh] indicates them through the media.”

So far the main sign Salemeh has given was the seemingly high figure of 96,000 housing loans supported through the package, which he mentioned at a public speech in November. There has, however, been no specific data released on this, and so it is impossible to assess how many of these loans would have been taken out by home buyers anyway without the interest rate subsidy (see real estate article article).

Lebanon’s economic activity grew in total an estimated 1.5 percent in 2013, according to the World Bank and government figures, but how much of that was supported by the stimulus package is unclear. The World Bank has done what its economist Ibrahim Jamali describes as a “small analysis” but has yet to undertake a larger one, partly due to lack of data. “The extent of the impact is still not clear. We will have to wait at least one or two more quarters to have a more elaborate idea [of how it affected the economy].” Ghobril agrees that there are as yet “no reliable estimates” of the impact on GDP, but believes that “without the stimulus growth would probably have been lower.”

Producing growth

One area of criticism, however, has come from the focus of the stimulus package. The decision to put over half of the available funds into real estate has certainly helped boost parts of that sector, but the knock-on effects for the rest of the economy have perhaps been more muted than if investments had been made elsewhere.

The issue is that real estate in Lebanon already suffers from oversupply — half-built or already empty buildings scatter the country. As such, a measure that helps people invest in their first homes has limited multiplier effects for the overall economy. “New mortgages are not generating the construction of new buildings, so it doesn’t generate economic growth and new jobs,” Ghobril says.

While BDL has yet to release in-depth details of where the second round of stimulus will go, Salameh has indicated the focus will not fundamentally differ from its predecessor. “This new package is similar to the one we launched this year,” he said in November, singling out real estate and technology as targeted areas.

There are fears that the continued focus on housing in the second package will do even less than the first one to help stimulate the real economy. The World Bank estimates that only 6 percent of loans made possible by the stimulus package went to the productive sectors, where multiplier effects are higher. “The real estate sector has already benefited from the first stimulus package,” the Bank’s Jamali says. “It should not be omitted in the second one but maybe more funds should be allocated toward the productive sectors.” Ghobril concurs that a shift in emphasis is necessary. “Personally I would shift it toward companies and sectors rather than real estate and mortgages.”

Roger Melki, senior adviser to the Ministry of Economy and Trade, sees nothing wrong in support for the real estate sector but adds that small businesses are suffering and need support. “What we have observed in the last 12 months is that the small and medium sized companies are refraining from taking loans, but not the large ones, they are investing.” A key indication, he adds, is the loans made by Kafalat — the government sponsored loan-guarantee company which supports small and medium-sized businesses — have fallen, with companies wary of expansion. “If you look at Kafalat loan guarantees they are 16 percent lower in 2013.”

Deck chairs on the Titanic

While debates about the focus of the package are relevant, more fundamental problems look set to undermine the impact of Salameh’s plans. One reason to doubt the impact of any stimulus package is the desperately low levels of confidence in the economy.

In the first six months of 2013, the Byblos Bank/AUB Consumer Confidence Index dropped to its lowest level since the index was founded in 2007. In total there was an average monthly reading of 29.4, down 14.1 percent from the second half of 2012. The primary reason is the country’s political turmoil, with the impact of the Syria crisis a major factor. Effectively, confidence in the economy is so low that even if loans are cheap, customers may be hesitant to invest.

In the face of such a difficult challenge policy makers need as many options as possible, but Salameh’s hands are tied. The central bank can only carry out a monetary stimulus — lending to the banks cheaply on the basis that the interest subsidy will feed into the economy — but such a funding mechanism is flawed in a static economy. If, as was the case with 2013’s package, confidence is so low that there is not enough demand, then the money goes unused. The alternative would be a fiscal stimulus — direct government spending in key sectors to boost demand.

“A fiscal stimulus would have a more direct impact. In terms of monetary policy you talk about channels of transmission — there is a stimulus package but unless people are willing to borrow the money and do something with it, it is not that useful,” the World Bank’s Jamali says. “With a fiscal stimulus the government is spending that money, so there is no question whether people will borrow it or do something with it that is not useful. A fiscal stimulus would be more immediate and this might be desirable at this time, given the state of the economy.”

Fiscal stimuli such as a hearty infrastructure development package might benefit Lebanon in more than one way. Applying this Keynesian methodology would be the responsibility of the government and this, unfortunately, is outside the realm of options for Salameh. Since the resignation of Prime Minister Najib Mikati in March 2013, Lebanon has been without a government of any kind, and there are few prospects of forming one in the coming months. For this reason, a fiscal stimulus package is impossible. In effect, the complete failure of the country’s political class to work together has crippled the country’s economic options for countering the impact of the downturn and forced Salameh into action. “BDL is taking on the role the executive branch should be doing. It is the government that should find ways for growth not the central bank having to bear this burden again,” Ghobril says.

As Lebanon looks for economic hope in 2014, the stimulus package is one area of positivity. Salameh has long been the driving force behind the economy, filling the role the politicians have failed to. But a combination of a severe lack of confidence, odd choices of focus and a lack of alternative options mean the real economy will likely be numb to the stimulus.

January 14, 2014 0 comments
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The Buzz

Business briefing: 14 Jan 2014

by Executive Staff January 14, 2014
written by Executive Staff

Economics and Policy

An electronic system that warns Saudi men when their female “dependents” are leaving the kingdom will be made optional in an historic move towards greater female independence.

More from Arabian Business

 

Two German diplomats survived a shooting attack on their car while on a visit to eastern Saudi Arabia on Monday, the state news agency SPA reported, but their vehicle was burned.

More from Reuters

 

Abu Dhabi has received strong interest from international firms for participating in its largest oilfields, the UAE oil minister said, as it weighs continuing previous partnerships with Western oil giants or letting big Asian buyers take stakes.

More from Reuters

 

Kuwait’s government will continue a review of its heavy spending on subsidies under a new cabinet appointed this month, the new finance minister has said.

More from Reuters

 

Companies and Business

Drydocks World, the Dubai-based group which has undergone a multi-billion-dollar debt restructuring, has been commissioned to construct the largest rig ever built for the North Sea in a deal worth $730 million.

More from Reuters

 

Major Dubai-based builder Arabtec Holding has announced that one of its units had been awarded a $705 million construction contract on Abu Dhabi’s Al Reem Island.

More from Reuters

January 14, 2014 0 comments
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Society

In with the old

by Nathalie Rosa Bucher January 10, 2014
written by Nathalie Rosa Bucher

While the bulk of Lebanese would not hesitate before buying a secondhand car, most frown upon the idea of purchasing, let alone wearing, secondhand or vintage clothes. Deeply engrained as this attitude may be, secondhand and vintage fashion is on the rise in Beirut. 

“I wanted to open a vintage store as I knew that in Europe it was [all] the rage but didn’t exist here,” Yasmeen Borro, owner of Vintage Story, says. Borro opened her boutique, the first of its kind in the Middle East, in Kantari in 2008. Initially, she had vintage clothes as well as accessories in store but quickly came to realize that while her clientele was open to buying and wearing previously used earrings or handbags, most drew the line with garments or dresses. 

“The thought of it being old, that it may have been fished out of an old suitcase or been found on a flea market or thrift store — I go to and find things everywhere, across Europe but also at Souk el-Ahad, in Tripoli and Sabra — is unbearable to most,” Borro says. 

Once she realized that previously owned dresses wouldn’t work, she concentrated on her own original creations, under the label Vintage Story, while also selling actual vintage earrings, brooches, necklaces, armbands, handbags, headgear and some clothes. 

“The old inspires the new and that works,” she says of her label, which she classifies as “high end.” She describes her clientele as mixed, consisting of Arab women; half foreign, mainly from the Gulf, and half Lebanese.

“Initially, I was convinced that you could find many things in Beirut,” she says of her sourcing process. “However, Lebanese women don’t keep much… people move, much has been given away. I sometimes get calls, and people offering me things at exorbitant rates. They offer me something for $80 that I can find in Europe for €20.” Consequently very few of the vintage items she sells are from Lebanon; most come from Berlin, Paris and Belgium. “I have a big purveyor in Brussels who manufactured classy leather handbags all his life. Every time I’m there I take some of his stock.”

While jewelry requires little work before being ready for re-sale, clothes need to be carefully inspected, dry cleaned, stains removed and any damage repaired. 

Once a year, Borro takes part in an expo, usually in the Gulf. “Women there love individual pieces. They try and outdo each other and are bold in their choices. They buy massive amounts of [vintage] jewelry!”

a new concept for beirut

Similar to Vintage Story, about half the items for sale at Naela Nammour’s Pink Henna are vintage and the other half new creations. Her Mar Mikhael boutique also specializes in vintage accessories, including handbags, jewelry and homeware. 

Nammour classifies an item as vintage when it is 25 years old or more. She has bags going back to 1900 and 1910 and almost every decade of the 20th century is represented, up to the 1980s. Over decades of collecting, buying and selling vintage items, she has become a vintage expert. 

“To me, secondhand is more recent, vintage is older. Vintage may be secondhand, but not necessarily as you sometimes find items that have never been used,” Nammour says. “I lived in Paris for 20 years and travelled around the world, and have collected a lot.” While she dearly holds on to many items found in various parts of the world, some of her own collectables constituted the initial stock for Pink Henna, opened four years ago.  Her customers are mostly locals. “Locals have discovered vintage, they often come to look for a present. [Then] the person who received the present often comes to look for the place where it came from,” she says. 

Nammour recently started a Facebook page and has relied on word of mouth. “We’re listed in the Zawarib [Beirut city map] and sometimes magazines or production companies come to take items on consignment for ads or shoots.” Vintage Story’s Borro, who has also relied on word of mouth, is setting up a website for her clothing label but otherwise prefers to remain niche and not advertise. 

To stock up, Nammour travels once or twice a year to comb through some of Europe’s flea markets, and works with a few professional buyers in various places, including France, the United Kingdom and the United States, from whom she gets most of her stock. 

Despite its rising popularity, a stigma still remains around vintage pieces. “The concept is new, Lebanese are used to the word but not everybody understands the concept. Many think that it’s never worn — not quite,” says Maya Kaddoura, founder of Washed and Found, an online buyers and sellers marketplace for vintage and luxury items. 

 “When I used to live in Europe there were so many dépot-vente [boutiques where high-end brands are sold at seriously slashed prices], you would have to beg to sell your things. Here it is the other way,” she says. 

“In France it’s more valuable to have an item that has history. Here, people are starting to get into it, often though not because of the idea, but because it’s less expensive. If they could buy something new they would. Things that work well here are handbags.” 

Her mother and grandmother’s beautiful garments sparked the idea for a vintage business. “I tried to come up with a project with limited investment. Initially, I considered a blog, but eventually opted for the e-commerce route,” Kaddoura says. She set up a slick website with high quality images and tried to do much herself, including retouching the pictures and finding the items to sell. “Setting up a payment gateway costs between $4,000 and $10,000 and, especially in Lebanon, many people are still getting used to the idea of buying online,” she says. 

After a soft launch in August 2013, Kaddoura did an official launch in November. “At the beginning friends of friends and friends of my mom’s were my customers, that’s how I also got my first items — word of mouth worked. Many people wanted to sell initially but the situation has changed somewhat as now there are a bit more people who want to buy. Things I sell now are more interesting as I know what people like and will buy…I have everything from fashion to accessories to shoes. I’m looking for jewelry, and I’ve just uploaded the first bridal pictures to the site. A Chanel bag is the item to have!” 

unique treasures

Kaddoura takes items on consignment and, once sold, 30 percent of the cost goes to Washed and Found, which covers the photo shoot, social media, retouching and handling fees.  

Those who want to view something need to do so by appointment. The 350 items in stock are stored in an empty office, cheaper in rent than a boutique.  

“My customers mostly consist of women aged between 18 and 40, people who want to sell are older. They have been holding on to their old clothes. Women aged between 18 and 26 are the youngest and largest group — they go for secondhand. A 19-year-old girl bought the first Louis Vuitton vintage piece I had.” Men don’t really feature, although a few have shown interest. 

Washed and Found, which employs one part-time assistant, ships internationally using DHL for international shipments and LibanPost in Lebanon. 

When the bounty of years of collecting claimed too much space in her house, Nawal Akl looked for a place to store some of it. “I got this flat in Mar Mikhael,” she says. “I rented it at first, and stored some of the many things I have here. The ‘untouchables’ are still at home.” 

Eventually Akl bought the flat and started to sell secondhand and vintage clothes, jewelry, accessories and shoes in 2011, to surprising success. “I thought I would have to make it work but it worked by itself. It pleases me when I see these items looking good on someone else.” 

The small flat on Badawi Street, named Depot-Vente, is the ultimate treasure trove, full of spectacular, ridiculous, chic and everyday items, where one can find genuine near-new leather boots for LL20,000, designer pieces, real fur coats or a 1970s bathing costume.  “I often find things during my travels,” Akl says. “And I go through cupboards… I also find contemporary stuff. I buy everything, and sell much at LL3,000. Everything that is well made, made longer ago or is handmade is priced differently, as are Italian and French brands. Items made in China — even Ralph Lauren or Donna Karan — are sold at LL3,000 because that is the production cost. When people now see something at H&M for LL80,000 they know it’s worth LL3,000. I do a sort of consumer education.” 

“This place allows people to find unique pieces. It allows for individualism and goes against conformity. We’re tired of H&M, Mango and Zara — everywhere in the world you see the same dresses and fashion.” 

It looks like secondhand is here to stay. Next year will see the launch of the e-commerce website, Garage Luxe, specializing in luxury brands. So far operating only on Facebook and Instagram, the store has a vast array of classics that could make it a game-changer on the scene. 

What matters to Borro is the fact that an old garment is given a second life. “Maybe with the crisis we’re experiencing, Lebanese will come to accept it more,” she says.

January 10, 2014 1 comment
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Society

Artistic vision on Beirut’s streets

by Maya Sioufi January 10, 2014
written by Maya Sioufi

Close to Beirut’s Sodeco Square, a painting of a LL100,000 bill has popped up. It’s not an exact replica of the real note. It features a portrait of the late and renowned Lebanese writer, artist and poet Gibran Khalil Gibran.  This is not the first time 20-year-old graffiti artist Yazan Halwani has painted influential cultural figures on the city’s streets. Stroll down Gemmayze and you will come across a large depiction of Lebanese singer Fairouz. Head to the industrial area of Qarantina and you will spot a portrait of the late journalist and political activist Samir Kassir.

An activist at heart

When he is not studying for his undergraduate degree in computer and communications engineering (CCE) at the American University of Beirut (AUB), Halwani is making Beirut’s streets prettier. Typically choosing walls crammed with posters of electoral candidates; Halwani brings them down or paints over them. “All our role models are politicians so I wanted to replace them with people that are more positive and influential. If we use them as role models instead, maybe the country will go forward,” he says.

Halwani is not just a graffiti artist and an honors list student. He is an activist at heart. His graffiti of Ali Abdallah — a homeless man well-known around the Bliss Street area whose death from cold early last year shook the AUB community — serves as a reminder “not to wait for someone to die on the streets because of the cold [but] to help them out, you can help anytime,” he says. He has plans to make his pieces work for the homeless but prefers to only share these ideas once they materialize. 

From French Rap to Beirut Streets

Halwani’s artistic journey started at the age of 14 when he was a student at the Grand Lycée in Ashrafieh. A fan of French rap, Halwani was influenced by several bands such as IAM and NTM, who talked of graffiti in their songs. He says he just wanted to be cool and drawing graffiti had something of a gangster connotation. His talent swiftly caught the attention of his friends and he garnered a long list of requests to design them graffiti nametags. As his artistic journey evolved, he started experimenting with calligraphy, an artistic form he now includes in many of his pieces. Eventually his work went beyond arousing interest among his friends and was spotted by renowned German graffiti artist Tasso. In Beirut on a commission for the downtown nightclub The One, Tasso reached out to Halwani and spent a day working with him on a piece in Ashrafieh’s Abdel Wahab Street. 

A costly endeavor 

Halwani’s first outdoor piece was a flop. He underestimated how many spray cans he needed and couldn’t afford to complete the piece in the Jnah neighborhood. That’s when he realized that to undertake further street pieces — some of which cost up to $800 — he would have to find a way to fund himself. So, he started selling canvases and taking work on commission. Starting off with his friends, his roster of clients eventually expanded to include media group LBC and Kuwait’s Zain Telecom. 

Last year he had his first, and thus far only, solo exhibition in Gemmayze’s 392Rmeil393 gallery entitled “Banana republic” — a reflection of his view of Lebanon, a politically unstable country with an economy largely dependent on the export of a single resource: human capital. On one of the gallery’s walls Halwani drew a smiling monkey wearing a tie representing the typical political candidate, with a banana in the background instead of the party’s logo. To poke fun at the quotes that go along with the electoral posters such as “For Lebanon only” he also modified one of Gibran’s renowned quotes. “If Lebanon wasn’t my country, I would’ve chosen Lebanon as my country” was replaced with “If Lebanon wasn’t my country, I’d opt for Canada as my country” to underline his frustration with politicians’ uselessness at curtailing youth emigration. 

Sadly Halwani feels his creativity is not utilized within his CCE degree. “It’s all about ‘previouses’” — the exams of former semesters — he stresses. He has no sense of fulfillment as he doesn’t “create anything; he feels the degree lacks innovation and creativity. In computer engineering, you can always create something new and that’s missing” he adds. And so he diverts his creative energy to the city’s streets, making them prettier and hopefully influencing passersby to ignore the political figures that don’t matter, and focus on the cultural ones that do. 

January 10, 2014 0 comments
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Society

Gurus of globetrotting

by Nabila Rahhal January 10, 2014
written by Nabila Rahhal

In today’s global economy, it is imperative for multinationals and large corporations to develop and maintain an international market to remain competitive. Whereas once upon a time that meant hefty periods of travel in any working calendar, today online meetings and virtual conference calls are beginning to replace the time and expense of travelling. But in Lebanon, where the internet connection leaves a lot to be desired, travelling is still really the only means to preserve relations with international clients, despite the cost. 

Travel agencies in Lebanon have been quick to meet the demands of Lebanese businesses and multinationals that have offices in the country by establishing separate corporate travel divisions within their agenices to handle frequent travelers and corporate accounts.

Today corporate travel divisions are an essential part of Lebanese travel agencies. Selim Boutros, corporate travel manager at Kurban Travel, says their corporate division constitutes 60 percent of the agency’s business and handles more than 250 companies in Lebanon and the region. They achieve this mainly through their Hogg Robinson Group (HRG) section — an international corporate service provider and travel management company which Kurban joined in 2006 and for which it now acts as the regional hub and contact center in Lebanon and the Levant area — and also through the Kurban Corporate section which handles smaller companies based in Lebanon and the group’s meetings and events section.  

Nadine Kekhwa, director of the corporate department at Nakhal & Cie travel agency, says they manage around 60 corporations in Lebanon for full travel packages, without counting the companies who book only airline tickets through them. She explains that, especially in the winter season, it is the corporate accounts — with their steady stream of travel — that bring in the most revenues to Nakhal, since most leisure clients go on only one or two vacations per year.

Although Wild Discovery declined to provide the exact number of their corporate clients, Claudia Rouhana, head of their corporate desk, says they handle “the biggest travel accounts in town.”

According to the travel agencies interviewed, clients are mainly from sectors with significant travel budgets, such as pharmaceutical, insurance and consultancy companies, as well as major banks and multinationals.  Employees of such corporations, according to the agencies, travel mainly to Middle Eastern countries or to Europe and usually for a period of two to three days for either international conferences and exhibitions or meetings with clients. 

For a corporate division to be viable to a travel agency, explains Kurban Travel’s Boutros, volume of travel is usually more important than company size or number of clients. Nakhal’s Kekhwa says that some multinational companies have such a big volume of travel that they need a dedicated employee to handle them separately. Such companies, whose accounts can reach up to $70,000 per month according to Kekhwa, bring in more revenue than several small client companies combined. 

While the internet may not provide a reliable alternative to travel agencies in Lebanon, agencies nonetheless face competition when it comes to possible clients booking and finding deals online. 

Agencies view themselves more in the role of consultants than airline ticket bookers for corporate clients, and though corporations can certainly use online resources to independently arrange their trip, agencies believe they are still irreplaceable as travel managers. According to Kurban Travel’s Boutros: “We are walking away from merely booking and more into management and consultancy, which cannot be achieved online. Our clients are very happy and surprised with what we do and we have double-digit growth figures in the corporate division.” 

 “It is true that Lebanese travelers tend to go online to look for competitive prices,” says Wild Discovery’s Rouhana, ‘‘but most of them rely on their travel agent to finalize the booking. The online platform is not seen as a real challenge for us as Wild Discovery launched an online booking engine last year — a complete online solution that compares prices and addresses the ticketing and hotel needs of its clients — and yet we still have a demand for consultancy and assistance from our business travelers, which implies that human expertise and know-how are essential.” 

 Corporations look for ‘‘flexibility, solutions, availability of a dedicated account handler and competitive rates,” from a travel agency, says Rouhana. While Kekhwa says that corporations generally ask for the whole package including hotel reservations, transfers within their destinations and visas.

The main concern for corporations when it comes to travel remains how much they can save financially without cutting down on important trips. Corporate travel divisions can help in this regard. “Some corporations have huge travel budgets both regionally and locally and are starting to be concerned. They realize they are spending that much on travelling but how are they spending it? Can they save and how can they monitor this? That’s where we come in,” says Boutros, adding that when they start managing corporate travel accounts, they save the company an average of 15 percent of their previously unmanaged travel budget, and can save up to 25 percent. 

Kurban Travel, explains Boutros, is able to achieve these percentages by consolidating figures and savings with participating hotels and airlines made possible through HRG which provides them with the necessary large travel volume. “Let’s say we are spending $10 million with Middle East Airlines (MEA), we go to MEA and negotiate a better deal, over and above the traditional miles. Mind you, this only works with corporations with a specific volume and destinations,” says Boutros adding that when they take over an account, after researching it, they commit to a tangible amount of savings based on the data gathered from the company. The specific amount of savings depends on travel volume and complexity. 

Kekhwa says Nakhal recognizes the importance of using their expertise to provide clients with the best rates in order to maintain loyalty: “If a corporation finds a hotel room at a lower price than the one offered by us, they will never use our services again and our goal is long term. This is why we have our contractors always seeking out the best rates.” 

As part of their corporate travel services, Kurban Travel maintains a constantly updated and extremely comprehensive database of their clients’ travel needs and policies. This allows companies to maintain compliance with their travel policies as Kurban acts as their gateway, not allowing employees to book against the terms of the policy — which not only saves companies money but also the awkwardness of informing senior employees that they cannot book in a certain airline or hotel class. This database also functions as a tracking system, allowing large corporations to immediately locate and reach their travelling employees through text messages in times of crisis. 

Nakhal’s corporate clients have 24-hour access to their agents through their personal cellphone numbers. They also have the option to settle their account at the end of the month in accordance with the terms of their agreement with Nakhal. “This is a service which our corporate clients enjoy; some corporations send their employees abroad on a weekly basis and you know how the accounting process is in corporations! It is more convenient for them to pay the statement of account at the end of the month,” says Kekhwa.  

Wild Discovery’s Rouhana sums up their role by saying that in the business world, time is money and they can save their corporate clients time through handling all details of their trips and prevent them from facing the unexpected while abroad. 

January 10, 2014 0 comments
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