الأحد، 16 فبراير 2014

Libya - Libya economy slumps ^

news24
Tripoli - Small businesses are prospering in Libya's major cities even as the economy at large is being throttled because of security problems and industrial action which has shrunk lifeline oil revenues.

Its financial woes combined with lawlessness has so far discouraged the return of multinationals, three years after the outbreak of an armed revolt which toppled long-time dictator Muammar Gaddafi.

Post-war reconstruction has been slow, with major infrastructure projects on the back-burner even as Libyans endure more and more frequent power cuts, especially in the west of the country.

Small businesses have been leading the way in post-Gaddafi Libya, with shops and boutiques in Tripoli and other cities boasting the latest in luxury brands.

"These investments are thanks to partnerships with foreign investors," said chamber of commerce chief Idriss Abdelhadi.

Such joint ventures have "promoted investment in the private sector at a time when the oil crisis has slashed the state budget, not allowing spending on planned development projects," he said.

Economic experts, however, stress that trade and services play a secondary role in the overall Libyan economy, with only little value added.

The oil crisis dates back to last July when striking workers and pro-autonomy demonstrators in eastern Libya began blockading the country's main terminals.

The action sent production shooting down to as low as 250,000 barrels per day, compared with 1.5 million bpd before the strike.

In early January, launch of production at Al-Sharara field in the south after protesters in the area lifted their blockade allowed the country's total output to recover to 570 000 bpd.

The oil sector accounts for 70% of GDP, 95% of state revenues and as much as 98% of Libyan exports.

Only last week, protesters shut down oil and gas pipelines to the Millitah plant from Al-Wafa field in southwest Libya.

Their action brought output back down to 460000 bpd, National Oil Company spokesman Mohamed al-Hrari told AFP.

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