Libya Businessmen Association: Problems of Diversification of the Libyan Economy

Abdulnaser Ben Nafaa, Chairman of Libyan Businessmen Council, discusses the diversification of the economy from hydrocarbons. Hydrocarbons or oil have dominated the Libyan economy since a long time now, as the oil forms 70% of the Libyan GDP, more than 95% of exports and approximately 90% of government revenues.

What are the prospects for diversification? Nafaa agrees that the economy is structured around oil.

“We start first by talking about the economy and how it is structured around oil. We spoke earlier about the rent-based old fashioned economy where the state is responsible for all the citizens, thinking that they didn’t need businessmen or a private sector based economy because all the dictators in the world fight whoever has money. So that defamed the reputation of the Libyan businessmen.”

Nafaa points to the EU that is responsible for hindering development for the economy. “On the other hand, the European Union plays a big role in hindering development and the way our economy is affected. For example the European Union prevented Libya from joining several agreements because of the old regime, like the GAT agreement and others. Also let me tell you another thing, we have a long coastline that stretches for more than 2,000 km, and it is abused by our neighbours through theft, when we should be the only ones to benefit from it. So when we try to fish and export our product, we will be told that we are forbidden from exporting our fish, and the exports should go through Egypt or Tunisia. So in this way the European Union is responsible for hindering the proper development of the Libyan economy. We are talking here about huge fish resources since we have a very long coastline, and the fish we have is not only about quantity but also the quality of it is great since the Mediterranean fish is considered the best in the world. Yet we are forbidden from exporting it so we need to go through Tunisia or Egypt. And as a Libyan fish company I rather sell my products in Libya than selling it in Egypt or Tunisia. This is how the European Union is pressuring us, they know we have oil yet they only allow us to export through the neighbouring countries. If we deal with this, it might push our economy by 10% and in the future it can go up to 20% through fishing and tourism, yet all of that will fall into its place in the right time by Allah’s Will since the state is doing what it should for us.”

“For example, I met our Minister of Foreign Affairs when he was conducting several meetings with the foreign ministers of countries from the EU, and we made it clear that our top priority is to open the door for Libyan exports because of the oppression that fell upon us. Also, the world labelled us as a country that has an oil-only-based economy, for example the GAT agreement we mentioned earlier states that the share of Libya from tuna production is only 900 tons, when we look at the tiny island of Malta we see that the share is 2,000 tons and for Tunisia it’s 1,700 tons, yet when we try to discuss this matter they tell us that every country as its own share! But the fact is that our share is eaten by Malta, Tunisia and Egypt through what they call “law”! We all must work together on this matter; the development and stability of Libya is a part of the development and stability of the European Union, there is no difference in opinions there. Libya is facing Europe, it is not a distant country,” explains Nafaa.

“This is why we need help from everyone, so that we can leave that stereotype idea that states that our economy is only based on oil. Sure we can’t get rid of this reputation instantly since we are a developing country with no private sector, but by Allah’s Will we will get there as we continue to demand for our rights, increase our shares and reduce our reliance on oil,” concludes Nafaa.