Notes on the McKinsey Report -Lebanon Economic Vision
In the “Lebanon Economic Vision” Mckinsey report the International consulting firm has set out its vision for Lebanon’s economy. It envisions Lebanon as a wealth-management and investment-banking hub.
There are 160 recommendations and it focusses on sector-based initiatives to boost the economy. The sectors are Agriculture, Industry, Tourism, Financial Services, and Knowledge Economy, and the Diaspora.
Caretaker Economy and Trade Minister Raed Khoury Statements on the McKinsey Report
Minister Raed Khoury believes that implementing the report is essential as it would send a positive signal to the international community. (Remember, there is $11 billion in grants and soft loans pledged at the "); background-size: 1px 1px; background-position: 0px calc(1em + 1px);" target="_blank">Paris Cedre Conference.) The report he says will disrupt the stalemate on non-decision making by the state..
Minister Khoury has been bombastic on the cultivation and export of Cannabis to boost the economy. McKinsey Report had recommended to legalise the Cannabis production industry which could net as much as 1 billion USD in revenue.
Vision of the McKinsey Report
The vision targets a GDP growth from the current 1 percent to an average of 6 percent by 2025. Implementation of the recommendations will enable 370,000 domestic jobs over the period reducing the unemployment rate to 8 percent from current 25 percent. It will reduce the public debt to GDP ratio to 100 percent and reduce the public deficit to 3 percent.
Positive Media for the McKinsey Report
The report has plenty of criticism in the media but some positive points mentioned are below
- Formation of Performance Management and Delivery Unit (PMDU) to execute and carry out the ideas. The PMDU will hold the government accountable by tracking the key performance indicators.
- Incorporation of Capital Investment Plan (CIP) portfolio
- Put pressure on the state to restart discussions and present a road-map to the international community on implementation.
Some Criticism of the McKinsey Report
- Common criticism of the report is that the report has disregarded local data such as bank reports and sectoral research of private institutions. It depends on official “dated” data from International Organisations like World Bank, IMF.
- The 1274 Page report is touted as being an aggregation of the previous official recommendations.
- Most scathing attack has been from the executive magazine article saying it represents only 200 stake holders.
- The report relies on Performance Management and Delivery Unit (PMDU) to execute the same. What if the PMDU gets mired down in bureaucratic hurdles?