| COUNTRY PERSPECTIVES
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LIBYA |
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Business opportunities & territorial marketing |
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Libya is a very promising market, with opportunities and challenges opening up throughout the economy. With proven oil and natural gas reserves estimated at about 39 billion barrels and 1.5 trillion cubic meters respectively and oil prices at record levels, Libya’s oil and gas sector will remain a high priority in the near future. |
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Libya |
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Libya |
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Introduction |
Libya is a very promising market, with opportunities and challenges opening up throughout the economy. With proven oil and natural gas reserves estimated at about 39 billion barrels and 1.5 trillion cubic meters respectively and oil prices at record levels, Libya’s oil and gas sector will remain a high priority in the near future. Libya would like to see significant foreign investment in non-hydrocarbon sectors. Major investment plans have been launched to improve infrastructure and transport networks, telecommunications (extension of fixed and GSM networks), information technology, electric power generation doubling generation capacity from 4500 MW to 8000 MW by 2020), development of oil and gas exploration and production to reach output of 3 million bpd in 2010, plans for the “artificial river” (the Great Man-Made River), installation of 11 desalination sites, digitalisation of broadcasting equipment and training, development of food processing industries, development of tourism industries, health & medical services, wastewater treatment, agricultural technologies, education & training, manufacturing, construction and engineering…
In 2005, 1 billion LYD was allocated specifically to alleviate Libya’s acute housing shortage through state-run building projects and mortgage loans. The Libyan government in recent years has increased its development budget and raised the proportion of funds going to telecommunications, construction, health, real estate and education.
The five-year privatisation plan announced by the government targets privatisation of 360 companies by 2008, 41 of which would be completely open to foreign capital. Priority has been given to heavy industries (steel and iron, chemical industries, cement, vehicle assembly), textiles/footwear, farming factories and state-owned public firms and banks. But bureaucratic regulatory and administrative procedures for foreign investments remain rather burdensome, including the obligation to submit a file including economic, marketing and social studies as well as administrative considerations. But foreign investors have been allowed to buy land and buildings in Libya under the terms of the law of October 21, 2003.
A list of companies slated for privatisation is available at:
http://www.libyaninvestment.com/privatization/privindex.php
The Libyan authorities set up the first elements of a strategy to promote FDI with the support of international financial institutions, in particular the IMF. Law n°5 of 1997 for the promotion of foreign investment was amended in June 2005 to broaden the scope of FDI and increase the country’s ability to attract foreign capital. In addition to traditional incentives (customs and tax exemptions), the Libyan Foreign Investment Board has set up a one-stop-shop for foreign investors. It grants a five-year license, renewable for a further three years. It also allows partnerships between Libyans and foreigners with no limit on foreign holdings except for those involving state-owned enterprises and banking. Other incentives are exemption from customs duties and income tax and repatriation of profits.
The oil sector is regulated by a more favourable legal framework: law n°25 of 1955, known as the Petroleum Law. As for country risk rating, the main insurance and rating agencies have recently upgraded Libya’s rating, with France’s COFACE awarding a C. |
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Agriculture, fishing and food processing |
Agricultural development is a national priority, with land area largely composed of desert, while climate and poor soil severely limit agricultural output. Only 1 percent of the land is arable, approximately 8 percent is pastureland and the rest is agriculturally useless desert. Most arable land lies in two locations: the Jabal al Akhdar region around Benghazi, and the Jeffarah Plain near Tripoli. Agriculture occupies 18 percent of the workforce and accounts for 6.7 percent of GDP. Libya’s main crops are wheat and barley, tomatoes, citrus fruits, potatoes, olives, figs, apricots and dates. Until recently, farming depended entirely on erratic rainfall and poorly developed irrigation systems. To ease the chronic water shortage, a massive engineering project known as the Great Man-Made River was launched in 1983, consisting of more than 1300 wells and daily supply of 6,500,000 m³ of fresh water to the cities of Tripoli, Benghazi, Sirte and elsewhere, 40 percent of which is used in agriculture. Libya plans to increase cultivable surface from 200,000 to 600.000 ha by 2008 to meet the needs of its population.
Years of embargo caused the closing of the majority of food processing units and those that are still operational have obsolete or useless equipment, with under-utilized capacity. The majority of foodstuffs are imported, essentially from Tunisia, Egypt and Malta.
In an effort to increase agricultural production and to stem rapid migration to the major coastal cities, the Libyan government has put forth various subsidy and land grant schemes. To date, the most successful ventures have been those that consolidate smallholdings into large production and marketing operations. With the aid of imported technology (irrigation, etc.), foreign consultants have helped identify “off-season” export crops such as red globe grapes that can be produced with water from the Great Man-Made River.
A major agreement for the development and modernization of Libya’s agricultural sector was signed with the UN Food and Agriculture Organization (FAO) in 2003, targeting improved national food safety thanks to promotion and diffusion of seed production and plant breeding on a broad scale.
Agricultural mechanization is underdeveloped. Procurement will be launched by the Libyan Tractor Company (the sole manufacturer of farming equipment), by GENCO (the public importer of farm equipment) and by public departments (Ministry of Agriculture, Directorate General for Agricultural Projects, etc.) Demand involves traditional farming equipment but also power-generating units and irrigation pumps for use at small farms that suffer from erratic supply of electricity and water.
Sheep dominate livestock, counting about 5.6 million head. Because of the adverse weather prevailing throughout the country, there is scarce pastureland in Libya for animals to graze and country’s requirements for meat are met by imports from Romania, Egypt, and Australia. Frozen meat is also imported from Australia and New Zealand. Poultry farming has been encouraged in the country as subsistence food and Libya imports frozen poultry meat in small quantities. Poultry for laying eggs can be imported, but import of eggs for direct consumption is prohibited. Some large farming factories are planned for privatisation and tenders are expected to be launched in 2006 for the purchase of livestock, mainly dairy cattle. Other opportunities exist, especially for husbandry expertise and race improvement in order to optimise dairy production and breeding for meat. Tenders are also planned to purchase veterinary supplies and specialized small-scale equipment.
With 1800 km of coastline and the second largest continental shelf in the Mediterranean, research has confirmed ample quantities of white fish, tuna and unexploited sea sponges and coral reefs, but this potential has not been exploited to date because of a small, outmoded fishing fleet. The government has been encouraging fishing activities and attempting to stimulate the consumption of fish products. The catch includes tuna, sardines, and red mullet. In 1986, a new fishing port was built at Zuwarah in the northwest and numerous ice plants have been built at several coastal sites. Agreements for joint development of fishing have been signed with several countries, including Tunisia and Spain. There is currently a tuna processing plant in Zanzur and two others in Zuwarah and Khoms for sardine canning. Many opportunities are available in fisheries, the fishing industry, trawling and aquaculture, the local marine environment being highly suitable for aquaculture investment projects. The government as well as private companies are eager to create new cannery and tinning facilities and to sell those already existing. Canning processes, freezing technologies and plants, food storage equipment, and refrigerated rail cars are also needed. |
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Water supply |
Libya is a desert country and finding fresh water has always been a problem. Natural resources (surface water, groundwater, watersheds) cover only 2.3 percent of needs, evaluated at 5 Gm3 per annum (80 percent for agriculture), mostly provided by groundwater. A national strategy to manage overall hydraulic sources has been drawn up by the General Council of Planning.
Similarly, there has been progress in providing access to safe water for the population and for agriculture and industry, thanks to construction of the Great ManMade River.
The main priority is to complete the Great Man-Made River project. Phase I of GMMR was completed in 1991 at a cost of $14 billion, pumping some 2 million cubic meters of water a day from As Sarir and Tazerbo to Benghazi and Sirte over a distance of 1200 km. Phase II has been completed, delivering 1 million cubic meters of water a day from the Fezzan region to Tripoli and the Jeffara plain. Phase III is divided into two sets of projects. Activities in the east include a 700 km expansion of the existing Phase I system linking Sarir to Benghazi, adding 1.68 million m3/day to Phase 1 capacity. Expansion involves construction of a reservoir and pipeline linking Tobruq to a well-field at Al-Jaghboub. The 500-kilometer pipeline will pump 138,000 cubic meters per day. Activities in the west consist of building a pipeline linking Ghadames to Zuwarah and Zawiya. Subsequent phases involve the extension of the distribution network and construction of a pipeline linking the Ajdabiya reservoir to Tobruq. Ultimately, the eastern and western pipelines will be linked into a single network.
The GMMR project is managed by the Great Man-Made River Authority (GMMRA). The prime contractor for the initial phases was the South Korean construction firm Dong Ah. The preliminary engineering and design work for Phase III, a $15.5 million contract, went to Nippon Koei/Halcrow consortium. The Frankenthal KSB consortium won a contract for construction of pumping stations and technical support, while Canada’s SNC-Lavalin built the pipe production plant. (Lavalin recently signed a memorandum of understanding for an additional $1 billion contract to assist with water distribution). The cost of this strategic project is evaluated at approximately 31 billion dollars, to be carried out in association with the French group Vinci.
Desalination output is currently reported at 30 million cubic meters per year. It is widely believed that even with extensions to the GMMR, there will be a large demand for desalination technology in Libya in the coming years. Over 60 percent of medium and large capacity desalination plants currently in operation are more than 17 years old. An initiative to desalinate saline water to supply the towns of Zuwarah in the east and Aboutara in the west was awarded to Sidem, a subsidiary of Veolia Environnement. Other work to mobilize water is managed by municipalities, which are in charge of the construction and maintenance of watersheds and reservoirs. Some 23 new reservoirs will be built in addition to the existing 17, increasing storage capacity from 60 million m3 to 120 million mm3 of water. Foreign companies are already active in this sector, such as the French engineering and design firm Coyne and Bellier, which has carried out a study for a watershed at Wadi Kattata with the Italian company Del Navero. The Yugoslav company Hydrograznia is working on dams at Zaghadua and Shuhubeen.
The Libyan government seeks to increase its output of desalinated and recycled water by installing new water purification units. A desalination complex with a capacity of 250,000 m3 a day in Janzour in the western suburbs of Tripoli has been launched, with investment estimated at $650 million. The German firm DVT is building desalination units in Khoms and Sidem is building some in west of Tripoli (e.g. Tobrouk). The US firm Ionics is also an important actor in this sector and the public company GECOL is increasingly involved and may in the long term become a major superintendent of relevant projects. The General Company for Water and Wastewater (GCWW) is seeking partnerships to maintain its purification stations and an agreement with the English company Invent has been signed. Biwater Construction (GB) has been awarded three contracts worth 40 million euros for the installation and maintenance of 13 desalination plants in Libya. The country plans to double its capacity to process waste water and seawater by 2025. Only 1.4 percent and 0.7 percent of respective needs are currently covered. Other issues (such as the environment), that have received low priority in the past are currently attracting greater government’s attention, especially as relates to sanitation and solid waste management in less affluent urban areas and pollution along the country’s coastline.
There are thus many opportunities in civil engineering and public works. Several hundred million dollars worth of water, wastewater treatment and desalination contracts are expected to be awarded over the next few years. |
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Building construction |
Libyan authorities have launched a housing program to build 150,000 houses and apartments over three years, entrusting the General Authority of Infrastructure and Constructive Development (GAICD) with execution of engineering studies and public works (accommodation, roads, and networks). The first project relates to construction of 50,000 houses in Tripoli by Chinese and Malaysian companies that will be able to call on foreign companies to carry out this important project, which will include commercial, rehabilitation and leisure infrastructure. The Amona Ranhill Consortium, 60 percent of which is owned by Ranhill Bhd of Malaysia was awarded a contract to build 20,000 residences in the municipality of Tajura near Tripoli. In addition, 50,000 individual or collective residences will be built by Libyan engineering companies. In support of this initiative, Libyan banks will offer 30-year loans at an attractive 2 percent interest rate. A further 50,000 residences will be financed by various private investment funds. Industrial construction is also booming. Contracting services and construction materials will be required in the coming years to support major road, large-scale office complex, hotel, and residential housing projects. |
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Civil engineering, transportation and infrastructure |
Libya’s transportation infrastructure is extremely weak. Roads, highways, railroads, ports, airports, indeed the overall infrastructure network needs to be upgraded. The paved road network (83,200 km) is insufficient to support the country development needs. Paved roads account for the two thirds of the national network and a quarter of the current road network is in poor condition. The main road is the 1822-km national coastal highway between from border with Tunisia to the border of Egypt, passing by Tripoli and Benghazi. The General National Company for Roads supervises maintenance building of roads. Contracting authorities have been set up in each of the shaabiyyat to oversee road construction and the government has issued a number of high-profile road and road-improvement tenders in recent months.
Inactive since 1969, the railway network was re-opened and a national company, the Railways Executive Board, was set up in 2000. It signed a $477 million contract with China Civil Engineering Construction Corporation and began the first phase of construction of a 163 km line with 16 stations between the Tunisian border and Tripoli.
Libya currently has 132 useable airports, 57 of which have permanent surface runways. There are four international airports: Tripoli International Airport, Benina Airport near Benghazi, Sabha Airport and Misratah Airport. There are also 10 regional airports as well as smaller airfields. Because of UN sanctions against Libya, air travel was prohibited between 1992 and 1999, with aviation infrastructure deteriorating and the serviceability of many Libyan aircraft declining. An $800 million program to improve airport infrastructure and the air traffic control network was approved mid-2001 and more than 20 airline companies resumed flights to Libya. In addition, along with the Libyan Arab Airline and Afriqiyah Airlines, a third company, Buraq Air transport has opened for business and ordered six Boeings 737s.
Finmeccanica, AgustaWestland and the Libyan Company for Aviation Industry have signed an agreement to form a joint venture called the Libyan Italian Advanced Technology Company (L.I.A.TE.C.) to provide know-how, training, technology and equipment, while the Libyan shareholder’s main role is to invest in infrastructure, plant and local marketing activities. A training centre open to all Libyan flight and maintenance personnel will also be set up. While announcing the creation of this joint venture, AgustaWestland also announced a contract to supply ten A109 Power helicopters for border patrol as part of a program worth a total of 80 million euros, including equipment and services. Delivery of the first two helicopters is expected at the end of 2006 and the beginning of 2007.
Concerning the maritime sector, port and harbour infrastructure is made up of several ports and oil storage terminals. Work has begun at the port of Tripoli to increase capacity but harbour capacity remains under utilized. There are several prospects for development in this area, particularly for the maintenance of existing infrastructure, modernization and adaptation of maritime embankments for all means of transport (including containers and tankers) and the creation of a new terminal for oil storage. The Libyan government announced it would be spending $10 billion to buy 32 new ships and $600 million to make port improvements. |
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Hydrocarbons |
Libya has huge reserves of hydrocarbons. According to the Oil and Gas Journal, the country had total proven oil reserves of 39.1 billion barrels at the end of 2005, 3 percent of world reserves and 40 percent of African reserves. Gas production will reach 10 billion m3 in 2006, including 8 billion exported to Italy via the Greenstream. Libya ranked 21st in 2003, third in Africa behind Algeria and Nigeria. These figures probably underestimate the country4s actual reserves. Indeed, it is generally considered that Libya is probably sitting on considerably more hydrocarbons not yet discovered, since only one third of the country is currently covered by exploration and production agreements despite recent procurement. Libya’s prospects for providing more oil are highly attractive.
Libyan oil production in 2004 was estimated at nearly 1.6 million barrels per day (bpd), with consumption of 237,000 bpd and net exports of about 1.34 million bpd. For the period 2000-2005, hydrocarbons accounted for 56 percent of GDP, 97 percent of the country’s exports, and 80 percent of revenue. The majority of Libya's exports is sold to European countries like Italy (562,000 bpd in January-October 2005), Germany (285,000 bpd), France (101,000 bpd), Spain and Greece. In addition, Libyan oil exports to the United States averaged 56,000 bpd over the first 10 months of 2005, after resuming in June 2004 for the first time in two decades.
However, Libya remains "highly unexplored" and only about 30 percent of Libya's land area is covered by exploration and production agreements. The under-exploration of Libya is due largely to the UN. sanctions and the lack of modern technology, but also to the stringent fiscal terms that Libya imposes on foreign oil companies. Changes to Libya's 1955 hydrocarbons legislation are likely to prove extremely helpful in boosting the country's oil output.
Since lifting of UN and US sanctions, the government has decided to modernize the country’s infrastructure and increase oil production. Overall, Libya would like foreign companies to help increase oil production capacity from 1.60 million bpd at present to 2 million bpd by 2008-2010 and 3 million bpd by 2015. To achieve this goal and upgrade oil infrastructure in general, Libya is seeking as much as $35 billion in foreign investment over this period.
It is in this framework that the country held two bidding rounds called EPSA IV (Exploration & Production Sharing Agreement IV) in 2005. The EPSA IV round launched in August 2004 offered 15 exploration sites by auction. In October 2005, Libya held a second bidding round under EPSA IV, with 51 companies taking part and nearly $500 million in new investments flowing into the country. In this round, acreage at 26 fields, both onshore and offshore, went to 19 companies. Agreements were for exploration periods of 5 years, extendable to 25 years under certain conditions. With the success of the first and second bidding rounds, NOC has announced that the country will offer at least four more bid rounds in 2006 and 2007, covering 261 blocks.
Libya's oil industry is controlled by the state-owned National Oil Corporation (NOC), which in turn runs subsidiaries Waha Oil Company, Arabian Gulf Oil Company (Agoco), Zueitina Oil Company (ZOC), and Sirte Oil Company (SOC). Libya has five refineries (Ras Lanuf export refinery, Az Zawiya refinery, Tobruk refinery, Brega, and Sarir) with a combined capacity of approximately 380,000 bpd, significantly higher than the volume of domestic oil consumption (258,000 bpd in 2005). Libya is seeking a comprehensive upgrade to its entire refining system, with a priority goal of increasing output of gasoline and other light products such as jet fuel. Possible projects include a new 20,000-bpd hydro skimming refinery in Sebha (which would process crude from the nearby Murzuq field and meet local demand in southwestern Libya) and a 200,000-bpd export refinery in Misurata. The Syrte Oil Company launched a call for bids for the construction of two gas pipelines valued at $270 million and Zawiya Refining Company launched a call for bids at the end of 2005 for extension of the Az Zawiya terminal and refinery facility. The Libyan government recently sold 60% of its interest in Tamoil, a company that does business in Egypt, Switzerland, Germany, Italy, and Niger.
Libya has vast natural gas reserves. Proven reserves as of January 1, 2006 were estimated at 53 Tcf by the Oil and Gas Journal, but the country's reserves are largely unexploited and unexplored, thought by Libyan experts to be considerably larger, possibly 70-100 Tcf. In recent years, major new discoveries have been made at the Ghadames and El Bouri fields as well as in the Sirte basin. Ongoing Libyan natural gas development initiatives include as-Sarah and Nahoora, Faregh, Wafa, offshore block NC-41, Abu-Attifel, Intisar and block NC-98.
To expand gas production, marketing and distribution, Libya is looking for foreign partners and investment to increase gas exports, particularly to Europe, mainly Italy and France. It would also like to convert power stations that still operate with heavy crude or diesel. Thanks to this program, exports could triple. Libyan gas exports to Europe are also increasing rapidly, thanks to the Western Libyan Gas Project (WLGP), the Greenstream underwater gas pipeline. The WLGP, a 50/50 joint venture between the Italian ENI and NOC, has already increased exports to Italy and beyond. Currently, about 8 billion cubic meters (210 Bcf) of natural gas are being exported annually from a processing facility at Melitah on the Libyan coast via the Greenstream to southeastern Sicily. Gas then flows to the Italian mainland and onward to the rest of Europe. In 2001, a joint venture agreement was signed between NOC and Egypt's EGPC for construction of a pipeline between Egypt and Libya. The joint venture company is called the Arab Company for Oil and Gas Pipelines (ACOG).
Yet, another ambitious project is to build a nearly 900-mile pipeline from North Africa to southern Europe. It would transport natural gas from Egypt, Libya, Tunisia and Algeria via Morocco into Spain. (A pipeline between Morocco and Spain already exists.) In addition, Tunisia and Libya agreed in May 1997 to set up a joint venture to build a natural gas pipeline from the Mellita area in Libya to the southern Tunisian city and industrial zone of Gabes. In late 1998, Tunisia and Libya signed an agreement for around 70 Bcf of gas per year to be delivered from Libyan gas fields to the Cap Bon in Tunisia and in October 2003 the two countries set up a joint venture gas company to build the pipeline.
Foreign companies are looking to Libya's liquefied natural gas (LNG) potential. In May 2005, Shell agreed to a final deal with NOC to develop Libyan oil and gas resources, including LNG export facilities. Reportedly, Shell is aiming to upgrade and expand Marsa El Brega and possibly build a new LNG export facility as well at a cost of $105-$450 million. Shell also purchased exploration rights for five blocks in the Sirte basin and the company began seismic work in November 2005. In addition to Shell, other companies like Repsol are also interested in developing Libya's LNG export potential
The Energy Ministry was re-established in 2004. Oil rights in Libya are awarded under Exploration and Production Sharing Agreements (EPSA) based on the 1955 Hydrocarbon Law. Downstream investment is covered by the 1997 Foreign Investment Law. |
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Electricity and power generation |
According to official data, the country’s wiring rate is nearly 100 percent. Libya's demand for power (4 GW in 2005) has grown rapidly over the past few decades, in line with national development, and major expansion of the country’s generation, transmission, and distribution systems is planned over the next five years, with plans calling for a doubling of power generating capacity by 2020 to reach 8 GW.
According to the General Electricity Company, Libya currently has electric power production capacity of about 4.9 gigawatts (GW). Most of Libya's existing power stations are being converted from oil to natural gas and new power plants are being built to run on natural gas, in large part to maximize the volume of oil available for export. Libya is also looking at potential wind and solar projects, particularly in remote regions where it is impractical to extend the power grid. To respond to growing need, Libya's state-owned General Electricity Company (GECOL) has drawn up a long-term master plan worth $3.5 billion of investment in eight new combined cycle and steam cycle power plants by 2010. A further $2.6 billion will need to be invested by 2020. About 2400 MW of this extra capacity is under construction and the rest is in various stages of the contracting process. Deals have been signed with Russia’s Tekhnopromexport and South Korea’s Hyundai, worth $600 million and $280 million respectively. Several power plants are being built, including the Western Mountain Gas Turbine Power Plant, the Zawiya Power Plant Gas Turbine Extension, the North Benghazi Combined Cycle Power Plant, the Zawiya Combined Cycle Power Plant, and the West Tripoli Power Plant Extension.
GECOL’s development plan also includes the building of hundreds of new substation networks, the restoration of 1000 km of lines, the construction of 20,000 km of overhead lines, 7500 km of underground cables and 3000 sub-stations to upgrade transmission and distribution systems. A new 400 kV grid and expansion of the existing 220 kV system are expected to cost around $1 billion. Nearly $200 million is expected to be invested to set up 10-network control centres by 2015. In 2004, a $225 million deal was signed with Germany’s Siemens to provide five district network control centres, scheduled for commissioning in early 2008. Ten-control centres are planned by 2010. A new national control centre is expected to come into operation in 2006, in addition to the upgraded Tripoli control centre.
Libya is also acting to reinforce interconnectivity with the Tunisian and Egyptian power grids. The 220 Kv networks between Egypt and Libya have been connected since 1998, those between Tunisia and Libya since 2004. A Maghreb consortium called Eltam has been set up between the Libyan entity GECOL, Egypt’s EEHC, Tunisia’s STEG, Algeria’s Sonelgas and Morocco’s ONE to study the feasibility of a highway backbone for the transmission network to enhance interconnectivity throughout the Mediterranean (MEDRING, Euro-Mediterranean electric ring). Projected growth of oil production will generate additional demand for electric power. The National Oil Corporation and its subsidiary companies have 117 electricity generators with total capacity of 1.1 MW. This equipment requires maintenance and the NOC has drawn up specifications for new acquisitions.
Libya also intends to develop renewable energies with a capacity 510 MW by 2020. GECOL is mapping an atlas of the wind and solar power potentialities and a study of wind potential along the east coast of Libya. A pilot farm of 25 MW wind-powered generators is planned and another pilot scheme using photovoltaic technology to provide electric power is under study. |
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Healthcare and medical supplies & services |
The pharmaceutical market is booming. In the absence of local production, imports are growing rapidly. The total value of imports of drugs and medical equipment is estimated at 280 million euros per annum, 70 percent for pharmaceutical products, and 30 percent for medical equipment. Growth prospects are expected to be considerable owing to a high population growth rate (+3.6 percent per annum), considerable government aid to the CEN-SAD countries (Community of Sahel and Saharan States) and the planned investments in healthcare systems.
Libyan suppliers are mainly European: English, Italian, Swiss, German, and French. The government is the main purchaser, through various organizations such as the Red Crescent are increasingly active in the country. Imports were a state monopoly, but since the opening and privatisation of this market, new import licenses have been granted to certain operators to supply pharmacies and private clinics. The public sector is being reorganized and could cover some 60 percent of demand. Companies that want to take part in public procurements or distribute products on the market through a local agent must be registered at the Food and Drug Control Centre. Tenders generally take place in spring for public procurement or throughout the year for the Red Crescent, but it is advisable that interested parties be kept regularly informed by their local representative. In-country production of drugs and partnerships with Libyan operators are means to secure a foothold in the market, which offers lucrative investment opportunities.
Libya’s hospitals and clinics for the most part do not meet international standards. Those Libyans who can afford it generally travel to Tunisia, Jordan, or Europe for medical care. Benghazi Medical Centre recently announced a $120 million tender for middle-level management staff and complete refurbishing of the facility, including advanced imaging equipment, basic supplies, furnishings, etc. |
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Tourism |
The country has huge potential for tourism. In addition to 1800 km of coasts and virgin beaches, Libya has a wide range of natural resources, such as extensive desert landscapes of gigantic dunes, ergs and oases. As for cultural heritage, Libya is home to some of the world's best preserved archaeological sites, showcasing tales of Roman, Byzantine, and Greek civilizations in Sabratha, Lebda (Leptis-Magna, among five world heritage sites in Libya) Sahat (Cyrene), Sousa (Appolonia), Dirsiya/Tolmeita (Ptolemasis).
A good road network and many airports cover the country. According to High Authority for Tourism and Antiquities (HATA) forecasts, the number of tourists should rise from 290,000 in 2004 to 630,000 in 2006 and 1,025,000 in 2008. Accommodation capacity is however very limited. There are only 194 hotels with11,815 rooms and 19,969 beds, the majority located in the urban areas of Tripoli and Benghazi. Few are up to acceptable international standards.
The government plans to build 14,800 additional rooms by 2008. A ministry in charge of tourism was set up with $7 billion in funds to be invested over five years, including investment in new accommodation facilities and significant improvement in both the development and presentation of tourist attractions (including those targeting domestic tourism) and the provision of supporting tourist facilities and services.
Tourism activity is governed by law n°7 of May 2004 and its application decrees. Law n° 7 of 2004 provided for creation of the Libyan Association for Voyages and Tourism (LAVT), responsible for the development of a comprehensive, nation-wide tourism policy. LAVT is the coordinating body for 25 government-run tourism agencies. Tourism projects are eligible for the incentives made available under law n°5 of 1997 (modified in 2003) governing promotion of foreign investment, which includes tax advantages and, exemption from customs duty on the import of equipment necessary to implement an investment initiative , etc).
Several projects have already begun, in particular the tourist complex at Tajoura (suburbs Are of Tripoli) and Borj Al-Ghazala in Tripoli. Others are in the pipeline. The project to safeguard, restore and manage the historical district of the Medina of Tripoli has set up a tourism facility. The opening to private investment has attracted foreign investors like the Corinthia Bab Africa Hotel, built in partnership with the Maltese. European firms, including France’s Club Med, are rumoured to have opened talks with the government for the construction of a few large resort facilities. South Korea’s Daewoo reportedly has plans to build a 100 million dollar, 3000-bed hotel complex in Tripoli. In 2004, the Italian real estate broker Gruppo Norman signed a deal with the Libyan government, a first step towards the construction of a 300-million euro resort on the island of Farwa, near the Tunisian border. A number of Italian firms have come to similar understandings regarding proposed developments in the Homs/Leptis Magna area, for example Valtur. Other tourism services such as travel agencies, cars rentals and tour guide are booming throughout the country. |
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