Reuters: Libya to privatise half of economy in a decade
Libya aims to want to put « 100 percent of the economy under the control of private investors« , Reuters quoted government official Abdelkarim Mgeg as saying on Thursday (April 1st). Speaking on the sidelines of the Libya Business and Investment Summit in Tripoli, the Privatisation and Investment Board strategic projects’ chief said that he expects fully half of Libya’s economy to « be in the hands of the private sector within the next 10 years« . After decades of international isolation, Libyan leader Muammar Gaddafi has begun tentative liberalisation of some parts of the economy and foreign investors are beginning to return.
The business environment remains unpredictable and decision making can be painfully slow but Libyan officials say that in the past 10 years they have privatised 110 state-owned companies – a third of the total – and they want to go further. Libya’s privatisation policy is not driven by a need for capital – it sits on a vast mountain of oil money. Instead, officials have said they want to attract private sector expertise to create jobs and reduce the country’s dependence on oil and gas.It remains a challenging place for investors, especially because government rules can change without warning. For several weeks, Tripoli stopped issuing visas to most European citizens over a dispute with Switzerland.
Swiss businessman Max Goeldi, who ran Libyan operations for engineering firm ABB, is serving a four-month prison sentence in Tripoli on charges that Switzerland says are linked to a diplomatic row over a Swiss entry ban on scores of Libyan officials, including Gaddafi and his family. Libya denies any connection.
Analysts say Libya’s lingering suspicion of foreign interference, ponderous bureaucracy and opaque legal system mean it will struggle to match the rapid growth in industry and services that helped Gulf states diversify away from oil. But Libyan officials say their country has competitive advantages, including security, plentiful credit, cheap energy and proximity to Europe.
Privatisation officials have said Libya had revamped its economic laws to end privileges for local investors over foreigners. »The new legalisation puts foreigners on an equal footing with local investors, » said Hashem Azwai, head of the investment department at the Privatisation and Investment Board.
Source: Emirate Business/Reuters