How did the Tripoli Special Economic Zone (TSEZ) project get started?
For a very long time, the northern part of Lebanon was marginalized from economic activity and investment. Indicators on poverty, economy, and development were always ranked lowest in the north of Lebanon. So, in 2007, the concept for the TSEZ started to be discussed in terms of how to foster economic momentum in Tripoli that would guarantee sustainable growth for that part of the country as a whole. By 2009 the entire legal framework was put in place but the decision to appoint a board of directors was delayed.
We started the feasibility process with $1.5 million in funding from USAID and this was a comprehensive and complex study, yet relevant in shedding light on what we could do with the project. The feasibility study assessed three different locations for the TSEZ, as well as the market assessment, the demand forecasting, the development of the financial and operational models, the implementation plan, and the identification of the sectors. Finally, in 2015, the Council of Ministers appointed a board of directors, and we are now preparing to set the TSEZ in motion.
What were the main advantages that Tripoli offered as a location for a SEZ?
Tripoli is the second-largest city in Lebanon, with a lot of untapped human and natural resources. Its location lies right next to the Port of Tripoli, the second largest port in the country, which has recently undergone an expansion. Trading activity in Tripoli has increased significantly over the past few years, with more shipping companies choosing the port as their berthing point. Also, it is the getaway for the Levant to the Euro-Mediterranean economic zone, the entry port to Turkey, and it is the connection through Syria to the Arab hinterland, an area of opportunity we look forward to exploring once the situation there improves. Tripoli also has the Rachid Karami Trade Fair, a 1 million sqm plot of land sitting in the middle of Tripoli that has not been properly exploited yet. Tripoli is well placed in terms of transportation routes, capacity, and installations and offers an excellent platform for attracting investment into Lebanon.
How has the TSEZ project brought the business community of Tripoli together?
Across the political spectrum, everyone seems quite cognizant that the TSEZ is one of the most important projects taking place in Tripoli today. Regardless of what party you are from, the project is known to be crucial. Tripoli is in a dismal state due to the lack of a manufacturing industry, very little economic activity, and because the few economic sectors present there are not diversified. This project presents a rebirth for the region and the business community is quite aware of that; people realize the TSEZ has the potential to attract investment and start a new chapter for the north of Lebanon.
Where will the funding for the TSEZ come from?
Considering the very limited financial means of the government, I have had to resort to concessionary and grant financing for a lot of the activities we are doing, and also for technical assistance, since we do not have the in-house expertise to undertake such a large and complex endeavor. For the past year, I have been trying to promote the project and pitch it to the international community. The process has moved forward, and today we have the backing of the Secretary General of the UN and the President of the World Bank. We have received funding from the Arab Fund for Economic and Social Development, the World Bank, and the UNDP. Now, we are in the process of identifying niche markets for the TSEZ, the sectors it will attract, and the final stages for the regulations, as well as the safety and environmental regimes.
How will the TSEZ differ from the Beirut Free Logistics Zone?
The Beirut Free Logistics Zone is a pure free zone with a customs-free zone and some incentives for traders, importers, and exporters, but with no developmental implications. On the other hand, the TSEZ has been given the authority to set up its own procedures and provide a streamlined business environment. We will provide state-of-the-art infrastructure with all the utilities, amenities, IT, broadband, and transport infrastructure. What we will have here in Tripoli does not exist anywhere else in Lebanon at the moment, so it will greatly contribute to the country's development process. We want to bring much-needed employment and socioeconomic development through the TSEZ, not just for Tripoli but all of northern Lebanon.
What will be the major benefits from TSEZ for the north of Lebanon?
The transformation of Tripoli started with the revitalization of the port. Now there is an opportunity to have Tripoli play a role as a platform for logistics, warehousing, and redistribution activities. We want to supply value chains from here and that would require prepping the local economy, such as training the local workforce, fostering high-skilled labor, and opening up the market offering for companies here. Also, the Lebanese government is about to pass two decrees to regulate oil and gas exploration. This hopefully would pave the way for gas and oil exploration off the shore of Lebanon. TSEZ can become attractive for downstream and upstream oil and gas companies. Finally, there is the Syrian factor. The international community is preparing for the post-conflict period in Syria and Tripoli is the closet city to the border, so we want to make the TSEZ an incubator for the reconstruction process. The government, local community, and private sector have to rise to the challenge and help prepare the local economy to be up to standard to benefit from this.