Economic Letter

ASSOCIATION OF BANKS IN LEBANON Research & Statistics Department The Economic Letter
Summary:
Real and external sector indicators deteriorated in the first quarter 2011 in relation to the same 2010 period though they improved in March when compared to the previous month but not when contrasted to the corresponding one of the past year. Banking activity also decelerated on a quarterly basis andthe overall balance of payments had a deficit that masked modest surpluses in February and March. Interest rates on the domestic currency were flat and the dollarizatiion of deposits at banks continued to have an upward trend. _______________________________________________________________________________________

March 2011

In this issue: Real sector p2 External sector p3 Financial sector p4Monetary developments p5 Public finances p6 Statistical appendix p8 _______________________________________________________________________________________ Tables: General indicators of economic activities p8 Total imports & exports by product p9 Imports by origin p9 Exports by destination p9 Consolidated balance sheet of banks p10 Money supply and counterparts p11 Outstanding public debt p12Treasury bills portfolio p12 Interest rates p13 Exchange rates p13 _______________________________________________________________________________________ Charts: Indicative charts p14

Economic Letter

March 2011

I- REAL SECTOR In March 2011, The total value of checks cleared in the domestic and foreign currencies increased to USD 6,099 million from USD 5,266 million one month back, but wasbelow the USD 6,486 million in March 2010. Checks cleared value, o/w 78.3 percent denominated in foreign currencies, rose in the first quarter 2011 by only 0.4 percent over the same 2010 quarter. The total value of returned checks in the domestic and foreign currencies went up to USD 116 million against USD 98 million in the previous month yet it lagged behind the USD 276 million in March 2010. Inthe first quarter 2011, returned checks dropped by 30.9 percent when compared to the first three months of 2010. Collected real estate fees climbed to LBP 89.7 billion from LBP 53.4 billion a month earlier and LBP 81.7 billion twelve months back. Collected fees in the first quarter 2011 slightly decreased, however, by 0.2 percent in relation to the corresponding previous year period. Constructionpermits expanded to 1,603 thousand square meters from 1,159 thousand square meters in the past month (2,009 thousand square meters in March 2010). Construction permits decreased, however, in the first three months of 2011 by 2.6 compared to the matching 2010 quarter. Cement deliveries increased to 399 thousand tons against 294 thousand tons in February 2011 (465 thousand tons in March 2010).Cement deliveries regressed in the first quarter 2011 by 6.7 percent vis-àvis the similar preceding year time frame. The total number of passengers arriving to and departing from Beirut International Airport improved to 181,467 and 162,557 persons respectively to total 344,024 persons. Arrivals and departures decreased, however, by 4.3 percent and 5.8 percent in the first quarter 2011 in respect ofthe identical 2010 quarter. Agricultural exports reached USD 13 million, up from USD 10 million a month earlier (USD 14

million twelve months back). These exports exceeded in the first quarter 2011 those reported in the first three months of 2010 by USD 1 million. Industrial exports (excluding gold ingots) progressed to USD 289 million against USD 263 million in February 2011 (USD 301 million inMarch 2010). Industrial exports remained stable, however, in the first quarter 2011 in relation to the first quarter 2010. Imports of industrial machinery retreated to USD 17.3 million from 19.1 million a month back and USD 20.8 million twelve months earlier. In the first three months of 2011, imports dropped by 8.7 percent when compared to the same previous year time interval.
Real Sector...