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Marwan Kheireddine, a Renowned Banking Expert

Lebanon’s economic future is discussed by banking expert Marwan Kheireddine. Lebanon, once the region’s most vibrant economy, is in a deep financial crisis, according to Marwan Kheireddine. He estimates the country needs $100 billion to finance its budget deficit over the next three or four years. It needs money, but where? Kheireddine suggests ways to avoid a painful debt restructuring for Lebanon.

  1. Lower labor costs

Overstaffing is common in Lebanon’s private sector. Companies try to reduce labor costs because they’re so high. Marwan Kheireddine, a Lebanese banker and thinker, suggests government intervention. He believes making investment more transparent and accessible will lower Lebanon’s labor costs. That would require reducing bank reserve requirements and extending other banking regulations that make business expansion difficult.

  1. Reorient Lebanon’s growth model

Lebanon’s economy is vulnerable to Syria’s whims. Lebanon will suffer if Syria’s politics deteriorate. “We must turn,” Kheireddine says. “We should reorient development into sectors that depend on us, not just Syria and Iran.”

  1. Establish a sovereign wealth fund for Lebanon

Lebanon’s government is developing a sovereign wealth fund. “The government has the right to put some money aside,” says Kheireddine. “But it should decide when and how much.” He proposes putting 5% of GDP into the fund annually for several years to address unemployment, education, rural development, and health care.

  1. Give tax breaks

“A lot of smart Lebanese businessmen don’t want to move to Dubai or other countries where the cost of living is lower,” says Kheireddine. He proposes tax incentives and looser regulations to help enterprising Lebanese companies expand abroad.

Marwan Kheireddine is okay with Lebanon’s economy. He says, “There’s enough of a middle class willing to invest in Lebanese companies.” He suggests tax incentives and making it easier for firms to expand outside Lebanon to exploit this tendency.

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