The purpose of the November conference is to obtain long-term financial assistance to help the country recover from Israel's devastating 34-day offensive that caused damage estimated by the UN to be in excess of $15 billion.
He also said that Lebanon needs the long awaited reforms and an end to the political bickering to overcome the devastation that resulted from the war between Hezbollah and Israel.

At the same time he said any financial help that Lebanon gets can be a big waste if Lebanon does not reform its economy and he emphasized the urgent need of privatization specially in the area of utilities ( Electricity company ) telecommunications and transportation.

Azour repeated what the IMF has reported about the GDP growth "which we had expected to be 6 percent this year will be negative" because of the war, but that the situation should improve in 2007. The IMF reported that GDP will shrink 3.2 % this year because of the war.

With Lebanon’s public debt being 180 % of GDP , Azour wants the private sector to take the lead in generating growth "We have to reactivate growth very quickly, not through public spending but with new investments, private consumption and the liberalization of a number of sectors," he said.

One of Azour’s creative projects calls for setting up a regional financial center in Beirut to service Lebanon and its neighbors including Syria, Iraq, Jordan and Egypt as "the Levant market is not served properly, in terms of trade finance."

"We want to go beyond the traditional banking sector, to develop equity funds, investment funds, private banking. And this will help promote economic activities and improve revenues in Lebanon," Azour added.

During a conference in Stockholm at the end of the war in August, donor nations pledged $940 million in emergency aid to help rebuild the devastated infrastructure, and help shelter the homeless.

Lebanon has had financial problems before…the 1975-1990 civil war also devastated the country and Lebanon had to borrow a lot of money to rebuild the country . This is why the public debt is 180% of the GDP

"The cost of the war damage that will be allocated to 2006 budget is about $1.5 billion. This will raise public debt to $41 billion at the end of the year," said Azour. For this reason he emphasized that due to the high debt ratio Lebanon cannot take additional loans and wanted any new aid to be in the form of grants.

The private sector also suffered badly as a result of the war , since Israel bombarded many businesses that were either forced to close or lay off staff. These need financial assistance to get back on their feet . Azour said that he is negotiating about $1 billion low interest new financing to help the private sector.

Azour said financial assistance was also being sought for the private sector, which suffered damage and major loss of earnings due to the war, forcing companies to lay off staff.

"We are negotiating with various international institutions, and already we have secured $700 million to $1 billion of new financing to the private sector - long-term with low interest rates," he said.

The timing of the war was devastating for the economy. According to Azour Lebanon’s economy registered a surplus of $2.5 billion by June 2006 compared to deficit of $1.5 billion by June 2005 and the economy was taking off. All indications were positive …tourism was going to set new records and exports were expected to show over 40 % growth. All of this came to a halt of course as a result of the war and that is why the GDP will shrink 3.2 % this year.

Azour thinks the timing is right to put the economy back on track by seizing the opportunity of getting the help needed while we have the attention of the international community.

Picture: Finance Minister Jihad Azour