VZCZCXRO9268
RR RUEHAG RUEHBC RUEHDE RUEHDF RUEHIK RUEHKUK RUEHLZ RUEHROV
DE RUEHLB #0973/01 1851420
ZNR UUUUU ZZH
R 031420Z JUL 08
FM AMEMBASSY BEIRUT
TO RUEHC/SECSTATE WASHDC 2399
INFO RUEHEE/ARAB LEAGUE COLLECTIVE
RUCNMEM/EU MEMBER STATES COLLECTIVE
RHEHAAA/NSC WASHDC
RUEATRS/DEPT OF TREASURY WASHDC
RUCPDOC/USDOC WASHDC

UNCLAS SECTION 01 OF 02 BEIRUT 000973 
 
SENSITIVE 
 
SIPDIS 
 
STATE FOR NEA/ELA 
STATE PASS USTR 
TREASURY FOR MNUGENT AND SBLEIWEISS 
USDOC FOR 4520/ITA/MAC/ONE 
NSC FOR ABRAMS/SINGH/YERGER/DEMOPOLOUS 
 
E.O. 12958: N/A 
TAGS: ECON EFIN PREL PGOV LE
SUBJECT: LEBANON: SYRIA NOT IN A RUSH TO PROVIDE LEBANON WITH 
NATURAL GAS (ECONOMIC WEEK IN REVIEW, JUNE 30 - JULY 6, 2008) 
 
CONTENTS 
-------- 
 
-- LEBANON WILL NOT BE RECEIVING NATURAL GAS FROM SYRIA ANY TIME 
SOON 
-- CONSUMER LEBANON ASSOCIATION: 4.7 PERCENT INFLATION DURING SECOND 
QUARTER 2008 
-- USPTO/MEPI IPR STUDY TOUR PARTICIPANTS HOST LECTURE ON IPR FOR 
LAWYERS 
-- ANTI-COUNTERFEIT ASSOCIATION LAUNCHES AWARENESS CAMPAIGN 
-- FINANCE MINISTER ATTENDS EUROMED COMMERCE CONFERENCE, DISCUSSES 
FREE TRADE WITH TURKEY 
-- MINISTRY OF INDUSTRY TO LAUNCH PROJECT TO GATHER DATA ON SECTOR 
-- IMF MIDDLE EAST TECHNICAL ASSISTANCE CENTER: LEBANON SIXTH 
LARGEST RECIPIENT IN THE REGION 
-- WORLD BANK RELEASES STUDY ON LEBANON'S POLICIES AND PERFORMANCE 
OF INTERNATIONAL TRADE 
-- LEBANON REGRESSES IN WORLD BANK'S GOVERNANCE SURVEY 
 
LEBANON WILL NOT BE RECEIVING NATURAL 
GAS FROM SYRIA ANY TIME SOON 
-------------------- 
 
¶1. (SBU) Advisor to Acting Minister of Energy and Water (MEW) 
Mohammed Safadi, Raymond Ghajar, told us on July 3 that Lebanon will 
not receive Egyptian natural gas to run the Beddawi power plant 
(northern Lebanon) as anticipated in June/July because the 
infrastructure between Syria and Lebanon's northern border is not 
yet ready.  He said Syria has repeatedly told Safadi that it needs 
three to six months to expand the pumping station in Homs and 
pipelines to swap Syrian natural gas for Egyptian natural gas. 
Ghajar hopes the infrastructure will be ready by the end of the 
year, but he believes "Syria is not in a rush to do it, most likely 
because of the tense political situation between both countries." 
Using natural gas in Beddawi power plant could reduce Lebanon's 
energy costs by around $200 million annually. 
 
CONSUMER LEBANON ASSOCIATION: 4.7 PERCENT 
INFLATION DURING SECOND QUARTER 2008 
-------------------- 
 
¶2. (U) On July 1, Consumer Lebanon (CL) association indicated that 
during the second quarter of 2008, prices of consumer goods rose by 
4.47 percent.  Meanwhile, CL estimated that total inflation in the 
past two years amounted to 47.5 percent. 
 
USPTO/MEPI IPR STUDY TOUR PARTICIPANTS 
HOST LECTURE ON IPR FOR LAWYERS 
-------------------- 
 
¶3. (U) On July 2, Judges Georges Okais and Henry Khoury -- who 
participated in the USPTO/MEPI IPR Study Tour held in the U.S. April 
14-25, 2008 -- hosted a lecture at the Beirut Bar Association 
entitled "Protecting Intellectual Property."  Approximately 300 
recent law school graduates attended, as the judges gave an overview 
of the economic importance of Intellectual Property (IP), relevant 
international treaties, the current status of Lebanese legislation, 
and enforcement capabilities.  The judges' recommendations included: 
pushing for the passing of an e-commerce law and Lebanon's accession 
to the WTO, updating customs legislation and improving customs 
enforcement of intellectual property, establishing specialized IP 
courts, enhancing the Police's Cybercrime and IPR Unit with greater 
authority and more resources, increasing citizen's awareness of IP, 
and incorporating more IP courses within the Judicial Institute. 
 
ANTI-COUNTERFEIT ASSOCIATION 
LAUNCHES AWARENESS CAMPAIGN 
-------------------- 
 
¶4. (U) On June 2, the Brand Protection Group (BPG) -- an association 
of leading local, regional, and international manufacturers and 
distributors aimed at combating counterfeiting -- launched its third 
consumer awareness campaign "Ask for your Rights, Refuse Counterfeit 
Products."  The campaign is scheduled to last until April 2009 and 
will be featured on TV, radio, print media, billboards, and in 
commercial establishments.  The campaign will bring increased 
attention to counterfeiting in product sectors of BPG company 
members, such as fast moving consumer goods, cosmetics, 
pharmaceuticals and sport goods.  Other activities such as 
participation in talk shows and interviews with local and regional 
 
BEIRUT 00000973  002 OF 002 
 
 
coverage are also planned. 
 
FINANCE MINISTER ATTENDS EUROMED COMMERCE CONFERENCE, 
DISCUSSES FREE TRADE WITH TURKEY 
-------------------- 
 
¶5. (U) On June 2, Acting Finance Minister Jihad Azour attended the 
seventh Euromed Commerce Conference in Marseille.  Ministers of 
Trade from 27 EU member countries and 13 Mediterranean countries, 
including Israel, discussed economic integration in preparation for 
the Union for the Mediterranean Summit that will be held on July 13 
in Paris. 
 
¶6. (U) French daily L'Orient-le Jour reported that, on the sidelines 
of the conference, Azour discussed with Turkish State Minister of 
Trade the status of negotiations for a free-trade agreement.  Turkey 
had proposed to replace the free-trade agreement with an association 
agreement, which will cover economic and technical cooperation in 
addition to commercial issues. 
 
MINISTRY OF INDUSTRY TO LAUNCH DATA GATHERING 
PROJECT 
-------------------- 
 
¶7. (U) The Lebanese Ministry of Industry, in collaboration with the 
United Nations Industrial Development Organization (UNIDO) and the 
Association of Lebanese Industrialists (ALI), announced that it will 
begin implementation of a project to gather industrial statistics on 
July 28, 2008.  The project will cover around 7,000 Lebanese 
industries that employ over five people.  Thereafter, the Ministry 
expects to be able to publish indices on industrial sector activity, 
industrial production and export activity on a regular basis. 
 
IMF MIDDLE EAST TECHNICAL ASSISTANCE CENTER: LEBANON SIXTH LARGEST 
RECIPIENT IN THE REGION 
-------------------- 
 
¶8. (U) The International Monetary Fund's Middle East Technical 
Assistance Center (METAC) indicated that Lebanon accounted for eight 
percent of its overall allocation of technical assistance delivery 
during fiscal year 2008, or the sixth largest recipient in the 
region.  More than 50 percent of METAC's assistance was allocated 
towards macroeconomic statistics support, followed by public 
financial management assistance, Central Bank accounting, banking 
supervision assistance, and revenue administration. 
 
WORLD BANK RELEASES STUDY ON LEBANON'S POLICIES 
AND PERFORMANCE OF INTERNATIONAL TRADE 
-------------------- 
 
¶9. (U) Based on a World Bank study in which Lebanon was measured 
against the rest of the world by five indicators dealing with 
policies and performance of international trade, Lebanon ranked 59 
in trade openness, 68 in market access for exports, 98 for 
logistical performance, 85 for ease of doing business, and 122 for 
trade performance.  The study also indicated that Lebanon's trade 
grew by 4.9 percent in 2007 in real terms, after declining in 
2005-2006 as a result of domestic and regional instability.  Trade 
accounted for 146 percent of GDP in 2007, while services accounted 
for 80.4 percent of total exports during the same year. 
 
LEBANON REGRESSES IN WORLD 
BANK'S GOVERNANCE SURVEY 
-------------------- 
 
¶10. (U) According to the World Bank's annual governance survey for 
2007, Lebanon fell in five out of six categories compared to the 
previous year.  Out of 212 countries worldwide and 19 MENA 
countries, Lebanon's rank regressed in the categories of government 
effectiveness, political stability, regulatory quality, rule of law, 
and control of corruption.  Meanwhile, Lebanon's rank rose by seven 
places worldwide and two places within the MENA region in the voice 
and accountability indicator. 
 
SISON