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Atlas of Lebanon

Part 3 - An Unbalanced Econoy: the Growth of Inequality

Lebanon and the Gulf Monarchies: An Increased Dependance

Bruno Dewailly

Texte intégral

1For the past 50 years, relationships between Lebanon and the Arabian Peninsula have been considerably strengthened and numerous Lebanese citizens have found jobs in the region, some making considerable profits. Conversely, for Arabs from the Gulf, Lebanon is a haven for tourism and investment, especially in the real estate sector. These intense connections raise the question of an increased economic dependency, subject to changing oil prices and geopolitical contingencies.

Intensifying migration to the Gulf countries and remittances

2For the past 40 years, the destinations favored by Lebanese emigrants have distinctly evolved. Three quarters of the migration flows may have been directed toward members of the Organization for Economic Cooperation and Development (OECD) during the Civil War but emigration to the Gulf countries has been increasing since 1960. From the mid-1990s onwards, the Arabian Peninsula has become the favorite destination of Lebanese professionals. The Gulf monarchies now attract nearly 50% of the Lebanese migration flow. Among them, Saudi Arabia and the United Arab Emirates rank first. But these migrations seem to have reached a ceiling because of the political tensions due to the Syrian civil war and the slowdown impacting the oil economies.

3Meanwhile, since the 1950s, the visitors coming from the Gulf have composed the largest clientele of the country’s tourism sector (more than 50% between 2000 and 2010). However, their number has been decreasing, from 384,000 in 2010 to 98,000 in 2014.

4Over the past 10 years, the annual total of remittances sent by the diaspora has varied from 5 to 7.5 billion US$, amounting to 14% to 26% of the GDP. Yet, since 2004, this percentage has been dropping: since 2009, this annual total has reached a ceiling equal to about 6.5 billion US$. From 2009 to 2013, about two thirds of these remittances came from countries that were members of the Gulf Cooperation Council (GCC), with variations partially correlated with those of the oil prices.

Figure III-6: The destinations of Lebanese emigrants in the Gulf

Figure III-6: The destinations of Lebanese emigrants in the Gulf

Figure III-7: Total and provenance of the remittances sent to Lebanon from 2009 to 2014

Figure III-7: Total and provenance of the remittances sent to Lebanon from 2009 to 2014

Predominance but decline in investments from the Arab Gulf countries

5From 2005 to 2014, foreign direct investment (FDI) in Lebanon has experienced strong variations: it has increased from 3.3 billion US$ to 4.4 billion in 2009, before dropping to 3 billion in 2014. In 2005, it amounted to 67% of total remittances, while, ten years later, it was only equal to 41% of their value. Overall, since 2000, 80% of the FDI has been coming from the Gulf countries, with a particular focus on real estate.

6Since 2007, the real estate sector has attracted the vast majority of foreign funds. Between 2010 and 2015, it concentrated more than 85% of the total FDI (90.1% in 2014). Predominant in the 1990s, the Emirati and Kuwaiti investments have been dwindling, while the Saudi ones reached their highest level in 2010–2011. Since 2011, other Arab investors have taken on a bigger role, including Syrian and Jordanian ones. Meanwhile, one may observe a withdrawal of real estate investors from the Gulf, who try to sell parts or all of their properties.

7These elements show the intensity and importance for Lebanon of its economic relationships with the Gulf States. The decreases observed in some sectors these past few years may result in an economic slowdown but also make Lebanon more independent from this regional center. These countries may constitute major economic partners but Lebanon probably should not build its model of development only on the sectors they favor, in order to avoid shocks and pressures resulting from this dependency but also because of the socioeconomic effects such a specialization could have.

Figure III-8: Total and origins of the Greenfield FDI in Lebanon since 2003

Figure III-8: Total and origins of the Greenfield FDI in Lebanon since 2003

Figure III-9: Origin of the foreign investments in Lebanon (2011–2014)

Figure III-9: Origin of the foreign investments in Lebanon (2011–2014)

Table des illustrations

Titre Figure III-6: The destinations of Lebanese emigrants in the Gulf
URL http://books.openedition.org/ifpo/docannexe/image/13236/img-1.png
Fichier image/png, 74k
Titre Figure III-7: Total and provenance of the remittances sent to Lebanon from 2009 to 2014
URL http://books.openedition.org/ifpo/docannexe/image/13236/img-2.png
Fichier image/png, 35k
Titre Figure III-8: Total and origins of the Greenfield FDI in Lebanon since 2003
URL http://books.openedition.org/ifpo/docannexe/image/13236/img-3.png
Fichier image/png, 92k
Titre Figure III-9: Origin of the foreign investments in Lebanon (2011–2014)
URL http://books.openedition.org/ifpo/docannexe/image/13236/img-4.png
Fichier image/png, 80k

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