In the wake of Sept. 11 attacks and market turmoil, businessmen search for ways to make Arab world more attractive for finance

Dania Saadi
Daily Star staff

Nearly 10 months after the Sept. 11 attacks on the United States, Arab businessmen are still talking about how to capture the Arab capital that is fleeing in the wake of financial turmoil on Wall Street.
The Arab businessmen who gathered in Beirut on Tuesday for a two-day conference were also still trying to discover why the Arab World still attracts just about $7 billion to $8 billion a year in investments.
The purpose of the third Economic Seminar, organized by the Damascus-based Mamoun International Corporation at the Gefinor Rotana Hotel in Hamra, was to brainstorm ways to safeguard Arab cashflow.
According to Mammoun Hallak, chairman of the Mamoun International Corporation, the forum was moved from Damascus to Beirut this year in order to showcase Lebanon’s financial and banking ventures.
But most of the financial officials that spoke during the event focused on the need to repatriate Arab cash.
“It is highly imperative that we retrieve emigrant Arab capital invested abroad, which is estimated at over $1 trillion,” said Fahim Modad, vice-governor for the Central Bank of Lebanon at the opening session.
“We need this money to meet the needs of our markets, particularly as these markets are now better equipped to cater to investors.”
The Arab world is better positioned to receive this cash, particularly as average losses on international financial markets over the last 15 months have reached over
25 percent of investments, according to Modad.
Modad also said that, despite the Arab banking and financial sector’s lackluster performance when compared to other regions, it has scored some points over the years.
“According to the Arab Monetary Fund, market capitalization has doubled and the number of listed firms have increased by 55 percent over the past six years,” he added.
Makram Sader, secretary-general of the Association of Banks in Lebanon, turned the spotlight on Lebanon’s banking sector and its mix of Lebanese and foreign players.
He said that this diversity, in addition to Lebanon’s liberal banking laws, are putting the country on a par with developed countries.
Sader said that some of Lebanon’s financial services are even more liberal than new entrants to the World Trade Organization.
Both Modad and Sader said that Lebanon recently issued a law liberalizing ownership of bank shares and that the country has promulgated a securitization law. They said that both measures are pushing Lebanon’s banking sector to new heights.
The two-day forum, which was held under the auspices of President Emile Lahoud, also featured the annual quality award ceremony for Arab firms.
Industry Minister George Frem, who represented Lahoud, presented the awards after praising the forum for bringing Arab businessmen together a few months after Beirut brought together Arab rulers for the Arab League summit.
Lebanese insurance firm Union Franco Arabe d’Assurance et de Reassurance (UFA), was one of 10 Arab firms that won a quality award Tuesday. Last year, Lebanese-Canadian bank received the award, along with 12 other Arab firms. 

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