Facetime with Jihad Azour

(CNN) -- Jihad Azour (JA) was hand-picked by Lebanon's Prime Minister to steer the country's economy in 2005.

MME's Charles Hodson (CH) has a frank conversation with the country's finance minister about how the ongoing political upheaval may impact on Lebanon's future.

Plus, Azour who is a key figure in compiling the country's budget shares his insights into economic growth and the government's ongoing reform program.

(CH): With the uncertainty in your region, and your neighbors in particular, Syria and Iran, Iraq and clearly Israel, where is the growth going to come from in Lebanon over the next few years?

(JA): Growth will come in Lebanon from high-value added services and industries. This is a country where in fact talent is driving growth and the economy. We don't have natural resources. We have, in fact, the best resource which is the brains of the Lebanese. We are very well positioned in the region as you know at a crossroads between various economies.

Therefore, we project that growth, as soon as the political situation improves, can reach easily seven to eight percent.

(CH): You've talked about the reform process and said that of 300 odd measures which you plan, about 123 have already been achieved. What are the next major steps going to be along this road to reform?

(JA): In fact, it showed that one third of the reform measures were introduced in the first year of a five year reform program, which is a good track record. And by the way, the International Monetary Fund in assessing the implementation of our reform program is very much satisfied with the results Lebanon is achieving despite a very challenging political and security environment in Lebanon. In less than nine months we were able to move ahead with one third of our reform agenda. We were not really navigating in calm waters -- on the contrary. The region was not also in the best environment and the international markets were not conducive with the increase in oil prices and international interest rates. But despite all of that, we are on track when it comes to our reform agenda.

(CH): You've also signed an agreement with the World Bank to cut red tape, to decrease bureaucracy in order to make it easier for companies to come in. How do you plan to improve the climate for investors in Lebanon?

(JA): First of all, we are working on several reforms and changing the legal framework. We have sent to Parliament more than 10 different pieces of legislation to improve the business environment. Privatization will also play a great role in improving and attracting additional investment to Lebanon. In addition, there are a certain number of doing business measures that we are changing in Lebanon. Lebanon, as you know, is one of the most attractive platforms for business and for trade in the region. We want to bring it back as a center for excellence, as a center for finance, as a center for trade, as a center for business in the whole Middle East region.

(CH): So it's very much, it's that old role that you always traditionally had -- a kind of Switzerland of the Middle East. Do you seriously think that you can get that back, that you can attract those sort of sectors - or have they already gone down the road to Dubai?

(JA): Of course we can. In fact, we're not competing. We believe that everybody can has their own chance. You know activities like technology, like media, advertising services, financial services, even industry. Lebanon and the Lebanese entrepreneurs are very well equipped to compete in the region. The diaspora is huge and it's very successful and many of them are interested in coming back and investing in Lebanon.

(CH): You say, as soon as the situation improves.

(JA): A lot of it seems to be on hold until the political situation changes, particularly in terms of bringing the diaspora back home and harnessing it to the Lebanese economy.

(JA): We were able to maintain the stability in Lebanon despite the challenging political and security environment we're living through today. We were also able to keep attention on investment in Lebanon. Of course, we're expecting much more investment. In fact, we're expecting to be one of the best destinations for investment in the Middle East. This is what the figures were showing in early 2006. The political uncertainty, it is hurting us.

But I think what makes Lebanon unique is despite all these difficulties, the system is still holding. There is financial stability despite the macroeconomic imbalances. We were less hurt than other emerging markets after the crisis of the international capital markets. Still, we see a lot of appetite in investing in Lebanon in the real estate. And you know, many Arab and non-Arab investors are very bullish on Lebanon. E-mail to a friend