Marianne Hoayek
Director of the Executive Office, Banque du Liban
Beirut, Lebanon

Marianne Hoayek has a degree in Business Economics from the Lebanese American University, a degree in Law from the Lebanese University and obtained her Masters in Laws of Banks and Capital Markets from the Saint Joseph University. She is currently the Executive Director heading the Executive Office at Banque du Liban since its establishment in July 2007. The office directly reports to the Governor of the Central Bank.
 Marianne is member of the official Lebanese delegation to the International Monetary Fund and World Bank Annual Meetings and member of several committees such as the Investment Committee and the Open Market Committee.

What has been the feedback/reactions to the Circular 331?

Since we issued circular 331 in August last year, we have had very positive feedback from all participants in the Entrepreneurship Ecosystem.

For the first time in Lebanon and I think in the Arab World, an innovative approach has been used by a Central Bank to create a platform dedicated to providing equity finance for Entrepreneurs through commercial banks.

Lebanese banks can invest in the capital of startups, incubators, accelerators, and funds. The Central Bank will guarantee 75% of that investment up to 3% of each banks’ capital.

This scheme made available around $400 million USD. Some were saying that the Circular will pave the way for Lebanon to become the Silicon Valley of the Middle East. We are keeping our hopes high… In all cases, once fully utilized we believe that this scheme will contribute to economic growth by 1%.

How is the selection process like? What are you looking for?

Well in terms of what we are looking for, as I said earlier, we are looking for investments in companies that will help foster the knowledge economy. The world we live in is directed by technology, and Lebanon has a big potential in this sector. We believe that the digital sector is a very promising one along with other sectors that are based on innovative and creative ideas. Supporting sectors where Lebanon has a comparative advantage could help increase competitiveness and create new job opportunities in particular to the talented youth.

The text of the circular specifies the conditions and the selection process; most importantly, the company should be a Lebanese joint-stock company with nominal shares, not a financial or an offshore company. Its work should rely on knowledge economy and aims at supporting creative intellectual skills. It has to have a positive impact on the economic and social growth in general and on job creation.

To date, we have had quite a number of companies that benefited from the circular. Presella through Al Mawarid Bank, was the first pilot project (June 2014). Since then we have approved the disbursements of funds for several venture capital and we have some other applications in the pipeline.

What are the next steps with the Circular?

In Lebanon in the past few years, we have been facing challenging circumstances that are putting a heavy toll on the economy’s ability to grow. The need to help the economy to face those challenges was one of the main reasons behind issuing the Circular 331. We will continue our efforts to help stimulate economic growth that can be translated into increased job opportunities and a better socio-economic position.

As for what’s next, we have been keen from the beginning to engage all stakeholders in a constructive dialogue regarding what we can do to help the economy. Last year in December we introduced the new platform to the banking sector and entrepreneurs alike in an event that we called: INNOVATE – Banking Outside the Box, and this year we believe that BDL Accelerate will help us shape the next steps needed based on the presentations of the prominent speakers regarding their experiences and best international practices. I believe that the discussions and interactions that will take place will be very useful to assess what more can be done… I am looking forward to learn from those interactions… 

What does Lebanon have to do to up its startup game?

I think we need to work on improving the business environment in general. In the World Bank’s latest report Doing Business 2015, which measures ease of doing business in 189 economies, Lebanon unfortunately slipped from the rank 102 in 2014 to 104 in 2015, a sign that we did not make any serious effort to cut red tape or introduce new regulations to improve the business climate. In the ‘starting a business’ category, Lebanon ranked 119 out of the 189 countries. If we would like to encourage entrepreneurs to start a business we need to make it as simple as possible and to decrease administrative costs. We also need to invest more in upgrading our educational systems and include entrepreneurial learning as part of school curriculum.

As for what concerns the Central Bank, we need to continue the work on improving access to finance for startups. Some work still has to be done on not only decreasing cost of capital for SMEs—this we have been doing for some time, and will keep on doing it for next year through our stimulation package—but we also need to make it more competitive and less burdensome.

We need to encourage banks to innovate in the tools they make available to SMEs in general and entrepreneurs in particular. We also need to work on encouraging the creation of incubators and accelerators in Beirut and outside the capital to be able to reach the largest number of entrepreneurs.