[Debate] In Libya, Foreign Bankers See a Coming Bonanza / Dash for Profit in Post-war Libya Carve-up
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Wed Aug 24 14:37:58 BST 2011
An inspiring sight for Arab revolutionaries elsewhere?
The Post-Gaddafi Boom: In Libya, Foreign Bankers See a Coming Bonanza
By VIVIENNE WALT / LISBON Thursday, June 09, 2011
It's hard to envision a booming Libyan economy with the country's
communication infrastructure shattered by bombs and its oil fields
abandoned and idle. Yet economists and investors say that as an
intensifying NATO campaign brings Gaddafi's 42-year rule closer to its
end, a bright future lies ahead — with Libya's mammoth energy reserves
capable of financing a postwar development program strong enough to
serve as a growth engine for the region. "Libya has $250 billion in
foreign-exchange reserves, and it can just keep on tapping into
foreign currency because of its oil sales," says Jacob Kolster, North
Africa director for the African Development Bank. "The potential is
(Read about what mediating in Libya could cost Medvedev.)
Gaddafi's Libya is hardly poor, with few of the problems that beset
neighboring Egypt, where about 40% of people live on about $2.50 or
less a day. The average Libyan household income is more than $14,000 a
year, according to U.N. statistics, and the literacy rate is about
. . . . .
Even the war damage could, ironically, drive economic growth through
the massive investment that will be needed to replace bombed-out
communications infrastructure, airports and buildings. "We will need
to build virtually anew the entire modern infrastructure," Kolster
told TIME in Lisbon, where hundreds of investors and bankers are
gathered this week for the African Development Bank's annual meetings.
Libya is one of the 53 African members of the bank, which is
headquartered in Tunis, and manages about $67 billion in capital.
The investment stakes in Libya, say the African bankers who are
meeting in Lisbon — where neither the regime nor the rebels have sent
representatives — are not focused on the country's energy contracts,
most of which are already accounted for. Instead, the opportunities
lie in developing other potential industries. There is no tourist
development along Libya's hundreds of miles of pristine Mediterranean
coastline, a short hop from Europe. And thousands of square miles of
arable land lie relatively undeveloped.
Libya itself already holds major investments throughout Africa,
including a chain of luxury hotels owned by Gaddafi's regime in Mali,
Sudan and elsewhere. Gaddafi's successor will be pressed by the
banking community to privatize those hotels, perhaps selling them to
foreign partners. "There's a drastic reshuffling of the decks," says
Papa Madiaw Ndiaye, CEO of Advanced Finance & Investment Group, a
private-equity company in Dakar, Senegal, which invests in projects
across Africa. "It's a chance for new people to get into these
countries and bring in a whole new energy."
Dash for profit in post-war Libya carve-up
By Jerome Taylor, Kevin Rawlinson, Laurie Martin and Charlotte Allen
Wednesday, 24 August 2011
British businesses are scrambling to return to Libya in anticipation
of the end to the country's civil war, but they are concerned that
European and North American rivals are already stealing a march as a
new race to turn a profit out of the war-torn nation begins.
Business leaders with previous experience of making deals in Libya
have told The Independent that plans are in hand to send a trade
mission to Benghazi to meet leaders of the Transitional National
Lord Trefgarne, a Conservative peer and chair of the Libyan British
Business Council, said he hoped to be able to lead a group to the
country "by late September, early October". He said: "Any mission
would be done in consultation with the TNC and would only be made if
adequate security protections were in place. I believe we should be
trying to make sure we can get whatever business we can."
After five months of fighting in the world's 12th-largest oil
producer, industry figures are acutely aware that billions could be
made in the coming years from rebuilding Libya. Immediate focus will
fall on the country's oil fields that are currently producing a 10th
of the 1.6 million barrels a day that were exported pre-revolution.
There is also intense lobbying for the multibillion-pound
reconstruction contracts that are likely to be offered once fighting
ends. The Independent conducted a straw poll of more than 20 Western
companies with previous business commitments in Libya. None would talk
publicly about its plans but many admitted privately that they were
keen to return once security allowed.
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