President's Letter - 2017

Dear ACI friends and colleagues,

If I had to put a title to the year we just stepped in, I cannot but write “the year of uncertainties”.

In fact, if you take a 360 degrees panoramic picture of the world you will only have a blurred image.

Starting with Brexit and the Trump election and looking ahead to the elections in France and other parts of Europe, one wonders if this is the real world or are we in a virtual reality game. Add to that the uncertainties surrounding the future of oil prices, the magnitude of the rise in US interest rates, US relations with Europe, China and Russia and the wars in some Arab countries; and the blur is persistent.

The long awaited election of President Michel Aoun last October in Lebanon should have cleared the way for a stable political environment but, alas, a new parliamentary elections law is still dragging its feet and is keeping the whole country in suspense.

Despite all the political and social uncertainties, a real hope for the country and the economy has emerged after the presidential election and the appointment of a new government. Economists are expecting a GDP growth of around two percent this year. However, the huge public debt and the negative balance of payments since 2011 are hindering a real economic expansion. Add to that the weight of over one and a half million Syrian refugees who are dragging down resources and employment.

The last financial engineering undertaken by Banque du Liban has provided some relief to the banking sector and was beneficial in reversing the deficit of the balance of payments for 2016.

The new regulations implemented by BDL, BCC and CMA require a substantial amount of investment and labor. We should expect more regulations in the pipeline since the financial authorities have decided to apply “the financial markets best practices in the world” to the Lebanese markets. This will put more pressure on us as treasurers and traders.

We have shown for many years our ability to adapt to different changes and circumstances, whether financial or regulatory. We should keep responding positively to changing environments knowing that change brings opportunities.

A high standard of ethics should always be our aim and we cannot forfeit it, for the simple reason that our country’s financial system reputation is at stake.

Your colleague
Nakhlé Khoneisser
President, ACI Lebanon