Salameh unveils new stimulus with green focus
The Daily Star, December 2, 2015
BEIRUT: Central Bank Governor Riad Salameh Tuesday unveiled a new set of packages to stimulate the economy with special emphasis on green projects.
“Thanks to our initiatives we have created over 10,000 jobs, while the number of companies involved in environmentally friendly projects increased from 34 to 270,” Salameh told participants in the Arab Green Economy Forum at the Adnan Kassar Economic Building.
Salameh added that the Central Bank launched a national initiative in 2010 to activate renewable projects.
The loans for these projects stood at 1 percent interest only and for duration of up to 14 years.
“The European Union has provided support worth 12 million euros [$12.7 million] and this amount has been used as a support for loans or interest on loans granted by banks and economic sectors. The aim of this national initiative NEEREA is not only for funding, but also training and awareness, in order to have a positive impact on the economy and environment,” Salameh said.
He added that there are also more than 325 projects that benefit from the environmental loans.
These loans have amounted to about $280 million.
Salameh expected the loans earmarked toward environmental projects to reach $600 million in the next two years. He noted that there are companies that benefited from these loans and are now producing 6 MW of electricity.
“There is interest from the public about environmental issues, as evidenced by the success of the projects [regarding] water heaters and solar energy, and Lebanon has become one of the [top] 10 countries in the world in the use of this medium. We have counted about 20,000 loans in this area,” he explained.
Salameh added that the environmental sector only represents 1 percent of Lebanon’s GDP but expected this percentage to grow in the next few years.
He repeated that the Central Bank will launch $1.5 billion incentive package in 2016 and offer these loans to banks with 1 percent interest only.
In return, these banks will provide loans to different sectors with special emphasis on environmental projects and housing.
“We have issued new circulars to address debts because the economic conditions in Lebanon are very delicate and the GDP growth is almost zero,” Salameh said.
These circulars are designed to organize the existing debts in the private sector, either by extending the loan period to another seven years, or foreclose them with properties or securitization. The banks can also discount the deeds with the Central Bank if they need liquidity.
“We are also about to issue a circular that will facilitate the creation of a real estate fund that can be set up by the banks, financial institutions and even individuals to buy properties or invest in projects. This way the real estate sector will not be a threat to the banks,” Salameh said.
At the end of the session, the organizers handed Salameh an award for his achievements.