As mirrored by a contracting PMI, the private sectors’ activity has been deteriorating in the past few years. As such, given the slow economic conditions in Lebanon, the number of loan guarantees plummeted from 712 guarantees by December 2016 to 544 guarantees by December 2017. Accordingly, the overall value of the guarantees has been on the downfall for the fifth consecutive year, dropping by 28.50% y-o-y to reach $66.45M in 2017 compared to a value of $92.91M during the same time in 2016.
During the year, the top three beneficiaries of Kafalat guarantees were agriculture, industry and tourism sectors, with respective shares of 38.90%, 33.79%, and 21.61%. As per sectors, the number of loans granted by Kafalat for the agricultural sector fell from 332 in 2016 to 210 in 2017, and loan guarantees for the industrial sector slid from 223 to 218, over the same period. Moreover, loan guarantees for the tourism sector dropped from 27 in 2016 to 23 in 2017.
Geographically, 41.06% of the guarantees were disbursed in Mount Lebanon, followed by 18.27% granted in the Bekaa and 14.34% in the South. The number of guarantees reached 209, 93, and 73 in Mount Lebanon, Bekaa and the South, respectively. The north still lags behind other areas in terms of development. This has been reflected by the low number of Kafalat guarantees in the area, which constitute 9.63% of the total.
Value of Kafalat Guarantees by December (in $M)
Source: Kafalat