Background

Beirut is the capital and largest city of Lebanon. Situated on a peninsula that projects slightly westward into the Mediterranean, Beirut is contained by the Lebanon Mountains that rise to the east. The Mediterranean climate of the city brings hot summers and mild winters. The area of the city is roughly 67 sq km (26 sq mi); some sites located outside the municipal boundary are commonly associated with the city. For decades a cultural and banking centre for the Middle East, Beirut was devastated during the Lebanese Civil War (1975-1990). After the war, the city began a slow rebuilding process and Beirut’s economy is recovering, with evidence of war damage was steadily disappearing. Indeed, Lonely Planet Magazine recently placed it in its top three of world’s best-kept secrets.

Beirut is divided along ethnic and religious lines. A division runs between the two hills on which Beirut was built: Lebanese Christians live mostly in Ashrafiyah, in East Beirut, while Lebanese Sunni Muslims live in Musaytibah, in West Beirut. Lebanese Shia Muslims and Palestinians now live predominantly in southern areas of the city. The poorest area of the city, southern Beirut, suffers from overcrowding due to high birth rates, lack of housing, and the periodic influx of Shias fleeing instability in southern Lebanon. There are also many Palestinian refugee camps in the area.

Economy

Over the years, Beirut's economy and infrastructure has suffered extensive destruction by years of fighting. In the early 1990s, however, Lebanese billionaire Rafiq Hariri, who became Lebanon's prime minister, launched a multi-billion dollar effort to rebuild central Beirut as a symbol of the nation's post-war aspirations.

Beirut has thus emerged as a thriving and expanding tourism destination, especially among Arab tourists. One billion dollars has been pumped into new infrastructure (new hotels and renovations) and this figure continues to rise. New modern developments are planned across the city and its suburbs, allowing more job opportunities and re-allocating Beirut on the world tourism map again as a regional and possibly as an international hub. However, during the 2006 Lebanon War Israeli bombardments damaged the infrastructure of Beirut, especially the poorer and largely Shiite South Beirut which is controlled by Hezbollah, and many areas are still in the process of rebuilding and welcoming tourists back.

Beirut is also a key strategic hub. It is home to one of the largest seaports of the eastern Mediterranean Sea; its location and depth allows it to host the largest mother ship vessels. And its recently completed container port is operating over capacity—ten years before studies showed it would.

Despite the global economic downturn Lebanon’s bank survived the great crisis. This was made possible by the strict regulations of loan lendings and other credit payments, issued by Riad Salameh, governor of the Central Bank of Lebanon. He received significant international for his achievements in being able to prevent the negative financial situation from reaching Lebanon and its capital, Beirut.

Investment climate and opportunities

Beirut is continually redefining itself: Mediterranean and Arab, cosmopolitan and nationalist, secular and religious, liberal and conservative, political and hedonistic, superficial and genuine.

Most of the wealth that established in Beirut has been used to promote tourism, commercial enterprise, construction, and an industry based on textiles, and food processing. Beirut is also famous for its publishing industry.

Considered to be the most Westernized city of the Middle East, Beirut has survived almost complete destruction numerous times but has managed to retain the reputation of being a place for businesses to invest. Even after 15 years of civil war in which Beirut was pushed to the brink of total devastation, the city has been in the process of reconstruction and re-establishing itself as the "Paris of the Middle East".

The civil war, however, has made drastic changes in the political, economic, and population geography of Beirut. Beirut has implemented a series of features to attract new foreign industries and businesses. Simplification of Visa requirements, a flat-annual tax rate for off-shore holding companies, the reduction of the corporate income tax to a maximum of 10 per cent, not to mention Beirut's banking secrecy laws are aimed at luring foreign investors to Beirut. The reconstruction gives light to the importance of commercial enterprise and industry in this city.