The oil industry is the big attraction for foreign investment, but there are opportunities in a number of other promising sectors.

‘One of the best investment laws in the world’ offers incentives to draw companies into the Libyan market

ILLIONS of dollars have been flowing into Libya since the lifting of sanctions, and the country is well on its way towards achieving its aim of becoming a leading destination for foreign direct investment (FDI).

The big attraction is, of course, the enormous potential of the oil and gas sector; however, other sectors of Libya’s economy, such as agriculture, construction, health, industry, telecoms, and tourism are also worth investigating.

The government puts a premium on transparency and building investor confidence, and has been working to create a favorable business environment by removing bureaucratic procedures. Improvements in the situation regarding visa and export controls are believed to be not far off.

Rajab Shiglabu, General Director of the Libyan Foreign Investment Board (LFIB), insists that Libya has one of the best foreign investment laws in the world. “It provides a lot of incentives for foreigners, but safeguards our interests at the same time,” he says.

Since 2000, the LFIB has issued more than 179 approvals to small and medium-sized projects originating from foreign companies. Mr. Shiglabu says there are plenty of opportunities for U.S. investment. “It would be nice to see Americans involved in non-oil sectors, like construction and housing, power plants, and the service sector.”

RAJAB SHIGLABU General Director of the Libyan Foreign Investment Board INTERVIEW	MAHAMUD AHMED AL-FTISE Secretary of the Board of Privatization INTERVIEW

Excellent prospects exist for U.S. exporters in advanced oil field technology, medical equipment and hospital supplies, aviation, power generation and transmission systems, computers and software, telecommunications, water resource equipment, farm machinery, and agricultural commodities such as wheat and corn.

Libya’s domestic market is small but has a strong purchasing power, and its geographical position and free trade zone in Misratah make it an ideal location for exporting to Europe and other parts of Africa.

Libya is approaching the third year of its five-year privatization plan, which lists 361 state-owned enterprises for transfer to the private sector. These range in value from $50,000 to $3 billion.

So far, only 65 state-owned companies have been transferred to the private sector, most of them small and medium-sized agricultural and industrial firms. Still, the process has been given a boost recently with the announcement that Libya is prepared to sell more than 60 percent of its stake in the Italian-based oil refiner Tamoil.

A number of large enterprises on the privatization list will be available for foreign investors to buy, such as cement, glass, steel, and airline companies.

However, Mahamud Al-Ftise, Secretary of the Board of Privatization, explains that switching the ownership of state-run companies to the private sector is aimed primarily at increasing productivity and profits, and focused on transferring ownership to local entrepreneurs.

“We need to create a national business community which can accept and work with foreign investors on the same level,” he says.