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Leah Al-Azzi wrote in Al-Akhbar: The central bank invested $ 175 million in the Cedar Oxygen Fund, betting that it would be a step that would encourage foreign investors to invest as well. The “center” hook was left empty, three months after the fund was launched, with no additional dollars coming in. Neither the “foreigners” want to “help” Lebanon without political guarantees, nor do the industrialists understand the principle of the fund’s work
Where did the Cedar Oxygen Fund for Industrial Lending become, which was launched on July 29, and the Banque du Liban announced a $ 175 million investment in it? After three months, the fund, which is expected to “positively affect Lebanon’s economy and society” – according to the Central Bank statement at the time – was the one that was negatively affected by internal conditions and the absence of ” foreign investors’ confidence “in the Lebanese system to lend it more money, and a number of expatriates declined. The wealthy Lebanese homeowners made their promises to participate in the investment fund. The amount has not yet exceeded $ 175 million, which is considered a “discouraging” indicator of its future, especially after its founders set a goal of attracting $ 750 million, which can turn into $ 3 billion, if the amount runs four times a year. It is surprising that the Central Bank has decided to play the role of an actor in the financial markets, “adventurer” to invest 175 million dollars of depositors’ money in an investment project without guarantee, which “regrets” for the lack of liquidity in foreign exchange and find a way to attract dollars to the system The Lebanese banker, on the other hand, withdrew dollars from his accounts abroad to deposit them in a box based in Luxembourg. The problem is not in the investment, but in its opportunity, circumstances and based on any vision that has been made. However, Governor Riad Salameh did not determine his choice based on these accounts. Rather, it was controlled by its “obsession” to obtain dollars to buy raw materials for industries that have an export market. Revenue from sales in Lebanon is re-pumped, which is positively reflected in the balance of payments figures (the difference between funds coming in and those coming out of the country). And since he has “a project that is trying to succeed, he decided to be the first investor to encourage others to join him, and there is no fear of any loss, as long as he is able to recover the money,” he also transfers financial sector actors, defending the project. The fund manager, Alexander Jihad Harqous, confirms: “La Banque du Liban can restore investment, with prior notice and within transparent and internationally approved principles.” Harkous is the CEO of “Cedar Oxygene”, specializing in all things “Portfolio Management”, and has experience in global financial markets..
Work on “Cedar Oxygen” began in early 2020, and the first date for its release was set in April 2020, before it moves to July this year. Delays, reflection of fundamental obstacles. The decision was made at the first session of the Central Council of the New Banque du Liban, and the fourth deputy governor, Alexander Muradian, was tasked with following up. “The discussion on this was quick, and approval was given in a manner similar to a recommendation, on the basis that the agreement between the Ministry of Industry, the Industrial Association and the Bank of Lebanon came before the start of the works of the Central Council “, according to the sources of the latter. The beginning of the observations registered by expatriate financial experts, that the constitution of the fund was done by mutual consent, wondering about the lack of bidding by Banque du Liban, “and the opening of competition to obtain the best project in adequate conditions, as long as the Central Bank, which suffers from negative reserves of nearly $ 54 million, has used Depositors funds to invest in a private limited liability corporation. Additionally, an annual administrative fee of 1.75% of the total amount in “Cedar Oxygen” is withdrawn annually, which means that if no amount is added to the $ 175 million, approximately three and a half million dollars will be withdrawn annually in each period of operation of the fund. “This means that the dollars invested by the depositor are reduced. As for the” problem “of” Cedar Oxygen “, it is contrary to what seemed a” solution “to secure financing of manufacturing companies Lebanese that would lead to “reducing poverty and creating jobs” (as stated on the project website), in a way that suggests that the entire industrial sector will benefit from Facilities, it turns out that the target group is exclusively those who do not suffer financial difficulties and those who can secure 30% of the loan value in cash dollars. Harqous responds to “Al-Akhbar” that the creation of a program to help the entire sector in the L Ibano is “the responsibility of the Ministry of Industry. We do not prefer any one industrialist over another, but we study the archives of the resulting industries. We want to help build a productive, non-rentier economy, and we are concerned about protecting investors’ money, especially the Central Bank, because it is the money of the Lebanese people.».
Why was the project bound by mutual consent? Harqous responds: The Central Bank was looking internally and with several companies for a way to solve the industrial crisis. “We presented proposals and plans and we had dozens of interviews with Banque du Liban officials. After appointing the four deputies to the governor, Harkous met with them: “We signed a contract with the Central Bank that allows you to monitor every three months only as an investor, and we hold regular meetings with him, and you get interest in exchange for the investment. (if earnings are recorded in the fund) of less than 5%, but Independent Decision. »The problem of transfers of” fresh dollars “to the country and credit for trade is the” argument “presented by the” central “for not setting up the fund in Lebanon. This fund “charges less than 1% as administrative expenses and not 1.75%, plus we pass on the profits we make to the fund,” as Harqous explains.
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Source: News
