Help for first-time job seekers
The government launched a $2.2 million program to improve the employment prospects of first-time job seekers in the country. The New Entrants to Work (NEW) program will be managed by the National Employment Office under the supervision of the Ministry of Labor, with technical and financial assistance from the World Bank. The NEW program offers first-time job seekers 12 months of on-the-job training in a private firm, along with life skills training, counselling and placement services. Also, employers who hire first-time job seekers will be fully reimbursed for the 12 months of social security contributions that they would have paid to the National Social Security Fund. The program’s stated objectives include breaking initial barriers in the transition from school to work, improving the skills of 1,600 first-time job seekers in a 75-hour comprehensive training program geared to develop job searching and soft skills, and linking the training content with the requirements of the private sector.
Cypriot-Israeli gas deal
Cyprus is looking to alleviate its electricity-pricing problem by securing an agreement to import natural gas from Israel. The Cypriots hope to use the gas to power their electrical generators until their own gas reserves are developed. In talks in early September the two nations also discussed the potential to develop a joint terminal for exporting natural gas. The talks came less than a week after a government committee chaired by Shaul Zemach, director general of Israel’s Energy and Water Ministry, recommended that Israel designate most of its estimated 950 billion cubic meters in anticipated natural gas reserves for export. Cyprus is looking for the delivery of 0.6 to 0.7 billion cubic meters annually, beginning in 2015 and running until 2018 or 2020, depending on when Cyprus can begin to exploit its own recent natural gas discovery. Cyprus currently has the highest electricity charges among European Union member states as it relies entirely upon heavy fuel oil and diesel for power generation. The controversial decision has yet to receive final approval. Talk of a joint terminal builds upon an approach in January 2011 by the Israeli Delek Group to the Cypriot government with a proposal to build a Liquefied Natural Gas plant on the island’s southern coast for the purpose of exporting Israeli and Cypriot natural gas to international markets.
Smoking ban in effect
The law prohibiting smoking in indoor and outdoor public areas such as restaurants, pubs, cafés, offices, schools and hospitals was enacted last month. The Tobacco Control Law 174 also bans all forms of tobacco advertisements such as TV, billboard and magazine advertisements; as well as tobacco firms’ sponsorship of concerts and other events. It also requires larger graphic warnings on cigarette packs. The law was passed in Parliament in August 2011 and came into effect on September 3 this year. Owners of establishments such as restaurants, pubs and hotels had a period of one year to comply before enforcement began. The ban had already gone into effect at indoor public areas such as hospitals, schools and public transportation. Lebanon is the third Arab country, along with the United Arab Emirates and Syria, to ban smoking in public places. The law also bans smoking in the workplace at both public and private institutions, as well as at airports and places of worship. Further, the law imposes penalties ranging between LL1 million ($666) and LL3 million ($2,000) on owners and managers of public establishments if their clients are caught smoking inside, and a fine of LL135,000 ($90)on individuals caught smoking in public spaces. Lebanon has one of the highest adult cigarette consumption rates in the world at 12.4 packs per person per month, compared to 3.7 packs per month in France, 3.5 packs in Jordan and 1.7 packs in Singapore. A study conducted by academics at the American University of Beirut conservatively estimated the direct and indirect cost of smoking on the Lebanese economy at $326.7 million annually.
Tourism spending dips
Total tourist spending in Lebanon dropped by 20 percent during the second quarter of 2012 compared to the first quarter of the year, according to Global Blue, the VAT refund operator for international shoppers [see story page 114]. By a more positive comparison the same statistics show tourist spending increased by 5 percent from the same quarter last year. Deep-pocketed visitors from Saudi Arabia accounted for 17 percent of total tourist spending in the second quarter, followed by visitors from the United Arab Emirates with 12 percent, Kuwait with 9 percent, Syria with 8 percent and Egypt with 7 percent. When broken down by region, Beirut attracted 86 percent of total spending in the second quarter of 2012, followed by the Metn area with 11 percent and the Keserwan region and Baabda with a mere 1 percent each. Fashion and clothing accounted for 75 percent of total spending, followed by watches and jewelry with 10 percent, home and garden products with 4 percent, department stores and souvenirs and gifts with 3 percent each and consumer electronics and household appliances with 1 percent.
Investment law shake-up
The Cabinet has received a set of amendments to the investment law, which target certain sub sectors and are intended to increase foreign direct investment. A ministerial committee submitted the amendments to the 10-year-old investment law No. 360, which stipulates a set of criteria that projects must meet in order to benefit from investment incentives and exemptions provided by the Investment Development Authority of Lebanon. The criteria include the size of the investment, the sector and sub-sector of the project, the project’s location, the impact of the project on the environment and on natural resources and the project’s economic and social impact in terms of number of jobs created. The targeted sectors in the law include agriculture, agro-industry, tourism, manufacturing, general technology, information technology, telecommunications and the media. Projects that intend to benefit from the incentives and exemptions must have a minimum investment size, which depends on the location.
Cabinet passes salary raise
The Cabinet approved a draft law for public sector salary increases bringing an end to the months-long dispute that led to strikes by civil servants. Also approved were a series of taxes that would be used to finance the public sector’s pay increase, which is estimated to cost the government more than $1.6 billion annually. Three ministers loyal to President Michel Sleiman opted out of the vote, raising reservations over the methods proposed to finance the raise. The measures adopted include imposing fines on coastal properties that have been illegally developed, a tax on interest rates for bank deposits, a tax on real estate renovation and fees in exchange for construction permits, according to Acting Information Minister Wael Abu Faour. Nearly 200,000 civil servants, Army and security personnel as well as retired government employees are entitled to the salary increases. Ministers are yet to reveal the mechanisms of how to levy the taxes, fines and fees. The draft law received broadsides from both the private sector and civil servants with the former warning of the repercussions on Lebanon’s struggling economy and the latter criticizing the decision to implement the raise in installments over five years.
