Above 80 percent of foreign direct investment (FDI) in Lebanon and Jordan goes to the real-estate and tourism sectors while the real economy in those two countries is shrinking, said Omar Razzaz, vice president of the board of directors of the social security corporation.
“The good news is that Lebanon, Jordan and Egypt do not have to worry about oil revenues but they do have to worry about labor immigration and huge debt problems because real economy in those countries is not being taken full advantage of,” he said.
His remarks came during a meeting held at Crowne Plaza Hotel in Beirut to discuss the challenges facing the Lebanese economy. The lecture was organized by the Lebanese Economic Association (LEA) in cooperation with Friedrich Naumann Foundation (FNF).
FNF is a German political foundation established in 1958 which works worldwide for the principles of individual liberty, the rule of law, market economy and human rights.
LEA is a non-profit association that aims to facilitate and promote the exchange of economics research on Lebanon among professional economists, and with the broader public including students, NGOs and government institutions.
Razzaz, a former World Bank official, started to address the problem by saying that previous reports by the United Nations and the World Bank showed that the total Arab manufacturing output is less than that of the Philippines.
Moreover, the number of patents registered from the Arab world is less than Israel and Greece. “And we know that the unemployment challenges are huge in the Arab world. It is the highest in the region among other regions in the world and we also know that labor participation is also the lowest of any active labor participation in any region in the world,” he added.
However, he continued, what is interesting is that this is not due to the lack of vision because every country in the region has a vision.
“It is also not due to the lack of reform input,” he added.