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TableTable ofof contentscontents 1. Mediterranean overview.....................................p.5 Building EuroMed partnerships (FDI section), Amina Ziane Cherif (maps), Jeanne Lapujade (proofreading), Lauriane Ammouche 2. Market trends and opportunities.........................p.7 This guide is designed as a Doing business toolkit for (Layout), ANIMA. 3. Foreign direct investments...............................p.13 clusters, SMEs, or entrepreneurs interested in The author would like to warmly thank The 4. Key players..................................................p.15 developing business partnerships in the agri-food Investment Development Authority of Lebanon (Diana 5. Recent national policies...............................p.19 sector in Lebanon. It provides an overview of the Menhem & Abbas Ramadan) and the Chamber of main opportunities available in the private sector, as Commerce, Industry and Agriculture of Zahlé and the 6. Selected programmes and initiatives.................p.21 well as concrete and useful data to those interested Bekaa (Said Gedeon & Gloria Hanna), for their 7. Major business events......................................p.23 to go further (contacts, agenda of events, etc.). support and contributions. References Disclaimer This publication has been produced with the support The Mediterranean Business Guide, focus on Agri- List of acronyms food in Lebanon has been prepared by ANIMA of the European Commission. The contents of this publication are the sole responsibility of ANIMA Investment Network under the EuroMed@Change . ANIMA-MIPO: Mediterranean Foreign Direct Investment Network and can under no circumstances Investments and Partnerships announcements Project, a Preparatory Action initiated by the be regarded as reflecting the views of the European Observatory implemented and managed by European Parliament and implemented by the Union”. ANIMA European Commission (DG Enterprise and Industry). Copyright . CDR: Council for Development and EuroMed@Change proposes new dynamics for SME © EuroMed@Change May 2013. No part of this Reconstruction and cluster internationalisation between Europe and 4 publication may be reproduced without express . EU: European Union targeted partner countries: Morocco, Tunisia, Egypt authorisation. All rights reserved. and Lebanon. It is managed by four organisations . FAO: Food and Agriculture Organization from across Europe (ANIMA Investment network as . FDI: Foreign Direct Investment Project leader, the European Business Innovation Centre Network, INNO AG and the Fondation Sophia . Ha: Hectare Antipolis as partners) and it coordinates with more . IDAL: Investment Development Authority of than 45 associated regional business, finance and Lebanon innovation networks. MED 10 countries: Algeria, Egypt, Israel, Jordan, Lebanon, Libya, Morocco, Palestine, Authors Tunisia, Turkey This Business Guide has been prepared and drafted by Manal Tabet, with contributions from Zoé Luçon . MoA: Ministry of Agriculture . MoET: Ministry of Economy and Trade . n.a.: not available © EuroMed@Change 2013 3 . Mediterranean overview An increased pressure which requires rapid The sector is characterised by a predominance of developments investments from multinational companies, mainly European. Attracted by the size of the markets but Agri-food is one of the most strategic sectors in the attached to their independence, the latter have so far Mediterranean. The region is indeed facing a steady favoured traditional projects, either through the rise in food needs as a direct consequence of the FDI and partnership announcements in agri-food in establishment of local production facilities (dairy rapid population growth and recent changes in the MED 10 countries (nb of projects, ANIMA-MIPO) products or biscuits in Algeria, Egypt, Tunisia and consumption patterns. If Turkey achieved a relative Nb. of investments Nb of partnerships Turkey for France’s Danone, fruits and vegetables in self-sufficiency, the deficit continues to widen in the 38 39 Tunisia for Spain’s SanLucar, vegetal oil or sugar in other countries of the region (respectively 55% and 34 40 Algeria, Egypt, Morocco and Turkey for Saudi Arabia’s 29 85% of food consumption was imported in 2011 in 27 Savola, etc.) or through the take-over or the 30 Egypt and Lebanon for example), increasing their 27 acquisition of a controlling stake in local businesses 20 dependence on volatile international markets. The (Turkish confectionery brands Balaban and Dogan, “Arab Spring” - which initially took the form of a 19 7 and leading Israeli firms Osem, Materna and Tivall for 7 6 7 social unrest caused by a dramatic raise in food prices 4 5 5 Swiss Nestlé, Tunisia’s producer of vegetal oil and 3 3 2 - has highlighted the urgency of improving food margarine Gias Ingredient for German Dr. Oetker, security as well as the necessity to achieve a more 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 etc.). integrated development of territories. However, the sector attracts more SMEs year after FDI project announcements in the agri-food sector by Stable investments trends year (+ 30% between 2010 and 2011) interested in MED country (total 2003-2012, ANIMA-MIPO) In light of the strong growth potential of the opportunities presented by business partnerships 84 Mediterranean markets, foreign direct investment (commercial and technological). Last but not least, (FDI) in agriculture and agro-industry has remained the recent entry of investment funds into the market 65 relatively stable to date. 2011 was however a record (TGP Capital, Investcorp, APAX Partners, Riverside, year, with major investments in Turkey (partial Global Emerging Markets, Actis, Capital trust) 40 acquisition of local brewer EFES by Britain’s SABMiller, highlights the strong potential for growth of the 30 27 takeover of local alcoholic beverage producer Mey sector. 21 Içki by TGP Capital) and large projects in Egypt 16 10 6 (Nestlé) and Morocco (Lesieur). 3 1 TR MA EG TN AL IL SY JO LB LY PS © EuroMed@Change 2013 5 SOME USEFUL LINKS MORE USEFUL LINKS . Food Security in the Mediterranean: a major geostrategic . CIHEAM’s Analytical Notes issue (2010), IPEMED http://www.ciheam.org/index.php/en/observatory/stu http://www.ipemed.coop/en/publications-r17/les-notes- dy-and-monitoring/analytical-notes Major assets and promising value chains to ipemed-c48/food-security-in-the-mediterranean-a-major- . OECD-FAO Agricultural Outlook develop geostrategic-issue-a183.html http://www.oecd.org/site/oecd-faoagriculturaloutlook/ The Southern rim of the Mediterranean has important . Mediterra 2012: the Mediterranean diet for sustainable strengths to shine in the agri-food sector, to start regional development (2012), CIHEAM - Presses de . Mediterranean Investment Map: sectoral guidebook on public investment policies in the Mediterranean with its excellent culinary reputation, Lebanon, Sciences-Po http://www.ciheam.org/index.php/en/publications/medite (2010), ANIMA Investment Network Morocco and Syria in the lead. The MED countries are rra-2012 http://www.animaweb.org/uploads/bases/document/I gradually increasing the value added of their agri- . Mediterra 2010: Atlas of Mediterranean agriculture, food, nv_MedInvestmentMap_ENG_Light_V2.pdf food sectors by developing the processing industry fisheries and rural areas (2010), CIHEAM - Presses de . Med opportunities: 25 niches markets in need of and packaging for export development. The recent Sciences-Po investment (2009), ANIMA Investment Network creation of agro-clusters (Morocco, Tunisia), including http://www.ciheam.org/index.php/en/publications/atlas- http://www.animaweb.org/uploads/bases/document/I laboratories and R&D centres, can support the mediterra nv_25NicheOpportunities_ENWithCover_light_02- modernisation of production equipments and the . CIHEAM’s quarterly Watch Letters, devoted to major 2010.pdf issues in Mediterranean food and agriculture development of typical products (prickly pear, camel . Overview of the agro-food sector in the Euro- http://www.ciheam.org/index.php/en/publications/watch- milk, etc.). Finally, a number of niches with high Mediterranean region (2005), ANIMA Investment letters growth potential remain largely untapped. This is Network . CIHEAM’s Briefing Notes http://www.animaweb.org/uploads/bases/document/ notably the case of ingredients and processes http://www.ciheam.org/index.php/en/observatory/study- Agriculture_en.pdf constituting the Mediterranean diet (horticulture, and-monitoring/81-notes-dalerte vegetable oils, processed vegetables, dairy products, aromatic and medicinal plants, etc.), of pre-cooked meals or organic farming. 6 © EuroMed@Change 2013 6 Market trends and opportunities LEBANON: KEY AGRICULTURE DATA Cultivated land (source: Various) Cultivable area 360,000 ha A tremendous diversity, a growing demand global recognition in terms of quality and refinement Cultivated area 270,000 ha Considering the size of the country, the quantity and linked to the international reputation of the Lebanese Bekaa Valley 42% variety of Lebanese agri-food products is impressive: cuisine, the country has several strong cards to play. Northern Lebanon 26% the climatic and geographic diversity of Lebanon have The country’s relatively high production costs Irrigated area 130,000 ha (salaries, energy, transport), counterbalanced by the granted the country different agro-ecosystems ranging Role in the economy (source: IDAL 2010, Eurostat 2009) quality of local resources and skills, suggest that the from semi-arid to humid. It therefore allows