Benghazi aspires to become Libya's business capital

* Eastern city wants to restore status as business centre

* Residents say marginalised for decades under Gaddafi

* Benghazi wants return of oil body to city

By Marie-Louise Gumuchian

BENGHAZI, Libya, Jan 23 (Reuters) - At a construction site on Benghazi's waterfront, engineer Seraj Bushada proudly points to a giant hole in the ground that will make way for a 48-floor office tower that city officials hope will help transform part of this port city into a modern business district.

Unlike the capital Tripoli, Benghazi, Libya's second-biggest city, has few modern high-rise developments.

Construction of the $300 million Three Towers project, which will include two smaller blocks housing luxury apartments and a hotel, was delayed due to the uprising against former dictator Muammar Gaddafi, which began here nearly two years ago.

The project is now due for completion in 2015 and is being promoted in Benghazi's bid to regain its former status as the country's business capital and end what residents see as decades of marginalisation under Gaddafi.

"We have to work together to realise this dream," Bushada said.

Turning that dream into reality will be a challenge. Security is a major concern for foreign investors in the city, highlighted by the attack on the U.S. diplomatic mission in September in which the U.S. ambassador and three other Americans were killed.

Only last week a car bomb killed a Benghazi police officer, the second such attack in as many days and the government is considering imposing a night time curfew on the city.

Many Benghazans, however, are calling for the country's new constitution - due to be drafted in coming months - to give the city powers to manage its own affairs and a share of the eastern region's resources.

While the revolution succeeded in overthrowing Gaddafi, they argue, it has failed to spread wealth more evenly in Libya. Benghazi is the main city in eastern Libya, which provides around 80 percent of the country's oil wealth, yet the city is still dependent on the government in Tripoli for funding.

Some residents and officials are calling for the constitution to officially restore Benghazi as Libya's business capital, a status it held under King Idris until his overthrow by Gaddafi in a coup in 1969. With an estimated population of nearly 1 million, it is roughly half the size of Tripoli.

"Everything was here before, Benghazi is the best place to be the economic capital," said businessman Kais el-Bakshishi of the "Benghazi Economic Capital" campaign, which counts about 700 members including local businessmen, activists and academics.

"The main reasons are its strategic location - a gateway to Africa and Egypt and historically the people of Benghazi are traders. A lot of businessmen in Tripoli are from Benghazi."

STRIKING A BALANCE

Perched on the Mediterranean sea, Benghazi was the first city to revolt against Gaddafi and later became the rebels' main base before Tripoli, some 1,000 kilometres (620 miles) away, fell in August 2011.

City officials' first priority is to push the central government to move state companies such as the National Oil Corporation (NOC) and Libyan Airlines, which were based here under King Idris but later moved to Tripoli, back.

"If we can get these back to Benghazi, we can make it the economic capital," said Abdelhamid Elhadad, head of the industrial and oil committee of the Benghazi local council.

"We are trying to restore Benghazi to what it once was," he said, sitting in the council's new offices - where posters claiming "Together we will build our city" hang next to signs banning weapons.

The NOC was formerly the Libyan General Petroleum Company, which was founded in Benghazi in 1968. After the NOC was established in 1970 it relocated to Tripoli.

"The objection is that it is like before - everything is controlled by Tripoli; this is not why the revolution took place," said Tahani Mohammed Ben Ali, head of the Benghazi workers' union at Libya's biggest oil firm Arabian Gulf Oil Company (Agoco).

"There are infrastructure, health, education needs here."

With the country still volatile, Libya's new rulers - led by Prime Minister Ali Zeidan's cabinet and the general national congress - know they have to strike a careful balance to appease regional rivalries.

That plays in Benghazi's favour and the oil ministry has proposed splitting the NOC into an exploration and production company based in Tripoli and a refining and petrochemicals company in Benghazi. Residents in eastern Libya as well as activists and oil workers vehemently oppose the plan, however, and say the whole company should relocate to Benghazi.

"If someone steals something from you, you want it back," Ben Ali said.

Other plans for enhancing Benghazi as a business hub include improving its infrastructure.

Its port is outdated while the airport, which has just one cramped hall, had been slated for an upgrade when the war began.

"The plan before was for 5 million passengers a year, now we want 15 million passengers a year," Bakshishi said.

South Korean company Nemo Partners is building a temporary passenger terminal at the airport. But progress on expanding the airport has been slow as the central government is reviewing previous foreign investment deals in the country before it approves new ones.

Benghazi officials are also considering building a free trade zone and have proposed public works projects to provide jobs, namely for the former rebel fighters who have yet to lay down their weapons.

"We want to look after the factories around Benghazi, we need to boost manufacturing," Elhadad said. "We have an industrial area of around 1,000 hectares, we want to have a real industry here, we want to build more hotels."

Elhadad wants Benghazi to be twinned with cities like Istanbul or Marseille to promote ties and plans to write to the mayor of New York, seeking to attract U.S. interest.

Industry in the area focuses on cement, and cable and steel pipe factories, as well as oil services, but badly needed foreign investment is only trickling in.

The International Monetary Fund forecast Libya's economy shrank 60 percent in 2011 due to the conflict but expected it to expand by 122 percent in 2012 and 17 percent this year.

TRADE PICKS UP

Benghazi still faces many of the same problems as the rest of Libya. Rubbish is piled up on its streets and beaches; jobs are in short supply; and weapons are everywhere as the government has failed to control rival armed factions since the end of the uprising.

However, it has seen more commercial activity in the past year and dozens of new clothing, food and consumer goods shops have sprung up.

"Things are getting better, lots of new businesses were established after the revolution," an Egyptian worker at a supermarket in the city, said. "And people are spending."

One local businessman said retail business in Benghazi had tripled since before the war, but did not cite a source for the figure: "The former fighters have money so they are spending."

At a conference this week, businessmen and campaigners laid out plans for Benghazi's economic revival, but many acknowledged security remained a priority.

Last week Italy - the former colonial power - suspended activity at its consulate in Benghazi and withdrew staff for security reasons after unidentified gunmen opened fire on its consul's armoured car.

The consul was unhurt but the incident recalled the attack on the U.S. mission, in which American intelligence officials say Islamist militants with ties to al Qaeda affiliates were most likely involved. Last week's hostage crisis in Algeria has added to security concerns in North Africa.

"How can you turn Benghazi into an economic capital when there isn't even any security?" Khaled Al-Nomi, a shop assistant, said. "Things are getting worse here, not better."

Many Western businessmen are adopting a wait and see approach towards Libya, keen to see whether the interim government can get a grip on security. Arab and Turkish businessmen are more prominent.

Local Benghazans stress that the violence is more against security officials than civilians, but the attack on the U.S. mission has been a setback.

"Some companies up until last year visited Benghazi," Tarek Alwan, managing director of London-based consulting firm SOC Libya, said.

"Some were actually progressing towards establishing local agents, but since the security is not fully stable in the city, I think many pulled out." (Additional reporting by Ghaith Shennib; Editing by Andrew Torchia and Susan Fenton)

Oil Ministry plans to split NOC in two; “unlikely” to placate Benghazi

Oil refinery in Brega. The NOC’s refining activities would be headquartered from Benghazi under the proposal.

The Ministry of Oil is proposing to separate the National Oil Corporation’s exploration and production activities from refining, establishing two separate bodies to be respectively headquartered in Tripoli and Benghazi.

The initiative comes a little under two months after a plan to give Benghazi effective responsibility for exploration, production and refining services in eastern Libya was put on hold following protests in Tripoli.

It is believed that the revised proposal is designed to placate oil workers and activists in eastern Libya who want Benghazi to have a greater say in the running of the country’s oil industry.

“In the oil and gas ministry, we have a near-term plan with respect to the [eastern] region,” new Oil Minister Abdelbari Al-Arusi said in a statement on the NOC’s website.

“[The body] will be called the ‘National Corporation for Oil Refining and Petrochemicals Industry’ and will oversee all companies operating in this area. It will launch projects and secure funding for them.”

In Tripoli would be headquartered the ‘National Corporation for the Exploration and Production of Oil and Gas’. The two departments would also have branches in Tripoli and Benghazi respectively, and would be under the Ministry of Oil.

According to the head of the NOC’s oilfield services arm, however, the proposal is unlikely to placate eastern discontent as currently conceived.

“I don’t think Benghazi will accept it”, Mohammed Albadaly, CEO of Jowfe, told the Libya Herald. “They want exploration and production, not refining. There are far fewer commercial activities in downstream, whereas upstream you have drilling, exploration, production, pipelines and so on”.

Albadaly said that the proposal would more likely be accepted by Benghazi if reversed, to give exploration and production responsibility to the east and leave refining in Tripoli, but that fierce resistance is likely to be encountered in the capital either way.

“A lot of the NOC’s employees are older; they have families and they have roots. They don’t want to move and they don’t want to lose their jobs. That’s why there was so much resistance to Decree 100”.

Under Decree 100, the proposal that was previously shelved, the NOC’s hitherto inconsequential Benghazi branch would have been given de factocontrol over the oil industry in eastern Libya, home to some 80 per cent of the country’s oil fields.

Five departments were to have been established, in the fields of petro-chemicals and refining, exploration and production, human resources, administration and finance. Having only been signed off on 4 October, NOC Resolution 100 was in force for less than a week before being suspended in the face of fierce opposition from staff in Tripoli.

Speaking to the Reuters news agency, Deputy Oil Minister Omar Shakmak described the latest plan as “a matter of reorganisation. We will receive feedback from experts within the oil sector and civil organisations … and upon that, a proposal will be submitted to the government,” he said.

Source: Libya Herald

In lawless eastern Libya, U.S. mission just latest victim

By Hadeel Al Shalchi and Marie-Louise GumuchianReuters
International treaties are clear. The Libyan government had a duty to protect the U.S. consulate in Benghazi and it failed utterly when the compound was overrun and four Americans, including the ambassador, were killed.

Libya's problem though, runs far deeper than just diplomatic protection: interim governments have barely governed, and the latest prime minister - named hours after the U.S. mission was torched - has no effective army or police force at his command.

A year after the overthrow of Muammar Gaddafi, the legacy of four decades of one-man rule - when many formal institutions of statehood withered - and of the popular uprising that killed him, is that an anarchic swarm of militias provides both what passes for official security and poses the main threat to it.

For a year, Libyan leaders, backed by the Western allies, have been gambling they can forge a political consensus which will seize power back from the heavily-armed revolutionaries in the streets before rivalries spin irretrievably out of control.

That time may be running out seems most evident in Benghazi. The consulate attack was only the bloodiest and most recent violence in Libya's second city; the seat of last year's February 17 revolution, it has a history of militant Islam, previously directed against Gaddafi, and deep grievances over western Libya's control of oil pumped out of the east.

As one member of the General National Congress, the interim parliament, put it - so bluntly that he did not wish to say it publicly - the state can probably do no more than contain the mayhem for now, still hoping it can build up its own strength:

"As the saying goes, 'If you can't solve the problem, manage it'," he said. "We need to manage it."

Prime Minister Mustafa Abu Shagour, elected by the Congress on Wednesday, said establishing the power of the state was still a priority: "We are going to work very vigorously to build our police force, our army," he told Reuters in an interview.

"We have to deal with these militias because some of them have nothing to do with the revolution, and are made up by a bunch of criminals. We have to dismantle them."

However, the failure of successive efforts since last autumn to persuade the ex-rebel militias to disband and disarm, or to transfer loyalties clearly to the interim leadership, itself a fractious body, has left many skeptical of future prospects.

"There is no shortage of weaponry in Libya, but there is an enormous deficit of state capacity," said Geoff Porter, an independent U.S. analyst of North African affairs.

"The gamble for the Libyans was that they would get their political house in order before the security environment became too difficult to contain. The government has lost that bet."

WILD EAST

In Benghazi, the local protection for the U.S. consulate in Libya's oil capital, fulfilling Libya's obligations under the Vienna Conventions on diplomatic missions, was provided by an outfit known as the February 17 Brigade, a collection of young men with rifles proud of their exploits last year in chasing Gaddafi's army west across the desert, aided by NATO bombers.

A second layer of official public order in Benghazi comes courtesy of Libya's Shield, another paramilitary unit born in the revolution and drafted in, ad hoc, by the new leadership.

But as events on Tuesday evening showed, the pro-government forces have far from secured the monopoly on violence which is a key definition of statehood. Others also helped themselves to the weapons left by Gaddafi's disintegrating army and seem prepared to use them against Western and Libyan targets.

When a furious demonstration, emulating a similar embassy protest in neighboring Egypt over an American-made film insulting to the Prophet Mohammad, turned into an assault with machineguns and grenades on the Benghazi consulate, the couple of dozen Libyan guards offered little resistance, Libyan officials in the city said. Outgunned, some guards may also have decided on their own that wrecking the embassy was justified - several Libyan commanders said Washington deserved to suffer.

Among those identified by local people in the crowd were members of a hardline Islamist group, Ansar al-Sharia. Part of a wider Salafist movement that favors a fundamentalist religious state and appears to have some past contact with and sympathies for al Qaeda, Ansar al-Sharia has been accused of involvement in several violent incidents in Benghazi in recent months.

Since Gaddafi fell, there have been fears that some of his weaponry, and enemies, will end up in a wider anti-Western militant movement across north Africa. But such militants are not alone in providing a platform for popular anger in the east against Tripoli's politicians and their allies abroad.

Life and business in Benghazi has been disrupted by sporadic violence and demonstrations, often accompanied by demands for greater autonomy or investment in the east, separated from Tripoli by historic tradition and 1,000 km of desert highway.

"The people who demonstrated in front of the embassy were seriously depressed about their daily lives in Benghazi and not just angry over the film," said Nasser Ahdash, a political analyst living in the city. "The film added to it. But people feel depressed. People need jobs, hope and a feeling like they're not forgotten by the central government.

"If you start with one hardliner, you will get three in Benghazi when they have this depression from seeing that all the economy, the embassies, are in Tripoli, companies are in Tripoli, all the contracts are in Tripoli," he added, arguing that the new government should improve an economic balance which Gaddafi had tilted heavily away from the east of the country.

Saleh Gaouda, a member for Benghazi of the two-month-old Libyan Congress, also blamed the interim authorities for a failure to impose order in the east and to delegate power to local leaders: "The security breaches we are seeing in Benghazi are a direct failure of the government," he said.

"There is no one on the ground in Benghazi who can make the right decision at the right time ... There is no one who can take control of the situation and actually take responsibility."

The immediate impact of the violence is a clear heightening of caution on the part of foreign diplomats and business people, who had already been taking great care in Benghazi following attacks that included a grenade ambush which blasted the convoy of the British ambassador in June. Libyan officials assured diplomats that the security brigades would protect them.

But the killings at the consulate have set back Benghazi's hopes of investment and international favor: "Certainly you will have people questioning whether to go there," one diplomat said. "The overall feeling is one of caution right now."

Tarek Alwan, whose consultancy SOC Libya advises foreign firms on doing business in the country, said: "The impact is great and will lead to more restrictions on travel, higher travel insurance, on development.

"Libya in general and Benghazi specifically will suffer -because we should never bite the hand that helped us."

Security Fears Cloud Libyan Oil Growth

By BENOÎT FAUCON, WSJ

Heightened security fears after the killing of the U.S. envoy to Libya will further slow the return of foreign oil workers to the country, potentially threatening Libya's plans to boost oil output and grow its economy, according to oil company executives and consultants.

"It's a serious blow to Libya in terms of security," said Tarek Alwan, head of consultancy SOC Libya, which advises international companies investing in the North African nation. "It will delay the return of international oil companies and expatriates."

Oil companies were beefing up their security precautions on Wednesday in the aftermath of the killing of Ambassador Christopher Stevens and three other American diplomats by suspected religious extremists in the eastern city of Benghazi. One European oil company told visiting foreign staff to stay at their Tripoli hotels as a precautionary measure, according to a Libyan oil professional.

Following the ousting of Moammar Gadhafi last year, Libya has surprised analysts by bringing its oil production close to pre-revolution levels much faster than analysts had expected.

Foreign oil companies with production interests in Libya—such as Germany's Wintershall AG, Eni SpA ENI.MI -0.33% of Italy and Total SA FP.FR -0.35% of France—have sent back expatriate workers.

But even before the U.S. envoy's killing Tuesday, attacks on Western interests in June and political protests this summer had already caused some oil-service companies and those with exploration concessions to revise their staffing plans for Libya.

That threatened the country's plans to boost output to 2.2 million barrels a day over the next three years, up 40% from present levels. Such an increase would be enough to overtake Angola to become the eighth largest producer in the Organization of the Petroleum Exporting Countries.

Back in July, Libyan production dropped by 200,000 barrels a day for a short period when protests over parliamentary elections disrupted operations at the country's largest terminal in el-Sider, in eastern Libya.

When it resumed its operations in May, BP BP.LN -0.45% PLC, which has by far the largest exploration plans in Libya, involving investment of $900 million, said the move would pave the way for a return of its expatriates. But three months on, a spokesman for the British company said it had yet to send its foreign staff back because the situation isn't considered safe enough.

Mr. Alwan said he knew of one international consultancy active in the oil sector had that pulled out completely from Benghazi, the capital of Libya's eastern region where the majority of the country's oil is produced, after a British diplomatic convoy was attacked in June.

When foreign staff return, Libyan oil managers say they are sometimes guarded by armored convoys when traveling to and from the airport. Restaurants where they plan to dine are checked first by security guards.

Once Libya accelerates plans to boost production, the reluctance of foreign oil workers to return could leave the country short of specialists in gas-injection equipment—needed to boost production from existing fields—and geologists and seismic workers needed for exploration of new fields, according to a Libyan oil manager at a large European oil operation.

Still, some Libyan officials are hopeful that the formation of a new government—expected to take place soon following elections in July—will lead to serious measures to improve security.

The tragedy "will be an incentive to be more dedicated about security," said Ahmed Shawki, head of marketing at the state-owned National Oil Co. "Other [oil-producing] countries had a worse situation," he added. "Look at Iraq."

Top Ten Surprises on Libya’s Election Day

By JUAN COLE

Most Western reporting on Libya is colored by what is in my view a combination of extreme pessimism and sensationalism. It has been suggested that because most reporters don’t stay there for that long, many don’t have a sense of proportion. It is frustrating to have faction-fighting in distant Kufra in the far south color our image of the whole country. Tripoli, a major city of over 2.2 million (think Houston), is not like little distant Kufra, population 60,000 (think Broken Arrow, OK)!

In the run-up to the elections held on Saturday, a lot of the headlines read ‘Libya votes, on the brink’ or had ‘Chaos’ in the title. But actually, as the Libya Herald reports, the election went very, very well (which did not surprise me after my visit to three major cities there in May-June). The NYT post-election headline of ‘Libyans risk violence to vote’ is frankly ridiculous; in most of the country that simply was not true, though it was true in parts of Benghazi. Even then, how many people died in violence in this election? I count two, but in any case it is a small number. In Tripoli, the election was described as a big family wedding, with lots of loud celebration and tears of joy. Here are the top ten surprises of the election for Libya watchers:

1. Turnout was about 60%, with 1.6 million casting their ballots. This high turnout is especially impressive given how confusing the election procedures were, with 3,000 candidates and only 80 seats out of 200 set aside for political parties (most newly formed and not well known).

2. There was relatively little election violence, certainly compared to South Asia, where election day often entails dozens, sometimes hundreds, of deaths. The Libya Herald piece quotes the High Electoral Commission as saying, “…of 1,554 polling centres across the country, 24 were unable to operate, including two in Kufra, six in Sidra and eight in Benghazi.”

3. The remnants of Qaddafi supporters made no trouble, and many went to vote enthusiastically. One of the many wrong predictions made last year by opponents of the revolution was that after it was over, there would be an Iraq-style pro-Qaddafi resistance. It turns out that Qaddafi wasn’t actually popular, and now that he is gone no one is interested in making trouble in his name.

4. One of the last cities to fall to the revolutionaries was Bani Walid, and it was alleged for a long time after the revolution to be in the hands of Qaddafi loyalists. This allegation was always a vast exaggeration. There were only a few militiamen there, who made demonstrations downtown. In fact, if anything, it was the revolutionary militias that controlled a city that somewhat resented them because of their high-handedness. Luke Harding of The Guardian, who bothered actually to go to Bani Walid, found people there as excited about the elections as elsewhere, and eager to combat their city’s reputation as a refuge of former regime loyalists. 46,000 had registered to vote, out of 85,000 inhabitants– i.e. most of those eligible to vote must have registered.

5. The formerly upscale city of Sirte, which had been seen by the revolutionaries as favored by Qaddafi, and near which he made his last stand, decided not to boycott the vote after all, according both to Agence France Press and to the following:

Rena Netjes ‏@RenaNetjes

Corresp alHurraTV in ‪#Sirte‬: “Turnout 70%, women 35-40%. Ppl very very happy to be able to vote for the 1st time” ‪#Lyelect‬.

There are genuine resentments toward Sirte on the part of the revolutionary cities, and locals complain about discrimination of various sorts. They clearly feel that being well represented in the new parliament is a way of gaining a voice and being reintegrated into the new Libya. It was places like Bani Walid and Sirte from which trouble on election day had been expected, and it did not happen.

6. The Muslim fundamentalist parties that were expected to dominate the new parliament may not do so. First of all, only 80 of the 200 seats are allocated to parties, and the liberal party of former head of Qaddafi’s National Economic Development Board, Mahmoud Jibril, is said to be doing well in early returns and exit polls. Because of the large number of independents and uncertainty with whom they will caucus, predictions about the shape of the government are premature. The West is more secular than the east or the south. In Libya, the remnants of the old regime are called ‘seaweed’ or ‘algae’ (tahallub), i.e. the flotsam left behind when the tide recedes. As in Tunisia and Egypt, there has been a lot of debate around what to do with them. They often have a lot of money, and are regrouping to succeed in the new system. Since a lot of prominent Libyan technocrats had been lured back to the country in the past decade, with Qaddafi’s and his son Saif al-Islam’s attempt to open to the West, leaders like Mahmoud Jibril (al-Warfalli) are considered by some to be leftovers, while others see him as someone who went over to the revolution and served as its first transitional prime minister.

7. Despite the faction-fighting that has plagued some desert cities, such as Zintan and Kufra, in southwest Tripolitania and the Fezzan region of Libya, respectively– its third traditional region after Tripolitania and Cyrenaica– went to the polls quietly and peaceably for the most part. Two of the polling stations in feud-ridden Kufra could not open because of tension. Here’s what my Jabal Nafusa and Fezzan twitter feed looked like:

“Women crowds in Zintan for voting …

9:16 AM – 7 Jul 12 via Twitter for iPhone ·

22h Libya.elHurra Libya.elHurra ‏@FreeBenghazi

July7: Election observers at a Zintan polling station. Reports of good turnout from women but no pics yet ‪#Libya‬

20h AC Tripolis AC Tripolis ‏@david_bachmann_

Very big crowd in front of voting room for people from ‪#Ghadames‬ – quite noisy, but relaxed ‪#LyElect‬ ‪#gheryan‬ ‪#Libya‬”

8. A big surprise is that what little election day trouble there was came from the East, from the center of the revolution. Thus, small crowds or small militia contingents attacked or tried to attack polling stations in Ajdabiya, Sidra, Ras Lanouf and Benghazi itself. But aside from a few stations in Sidra and 8 in Benghazi, all of them reopened and some stayed open till midnight to make up for having been closed in the morning. In one incident in Benghazi,pro-election crowds actually drove off a group of states’ rights protesters who want decentralization.

9. Women registered to vote, ran for office, and went to the polling stations in surprisingly high numbers. In some small cities, eyewitnesses thought the women’s lines were much longer than those of the men.

10. Among this generation of Libyans, democracy is really, really popular.

Elections to mark new start for Libya economy

For Tripoli businessman Salem Mohammed, Libya's first elections in a generation on Saturday will pave the way for what he believes the North African country should become - a new Dubai.

"We have oil, we have money, Libya can easily be just like Dubai," the 47 year old, who works in manufacturing, said.

"We just need foreign investors and hopefully they will now start coming and business will boom."

Nine months after the end of Libya's uprising, Mohammed hopes Saturday's election of a national assembly will mark a new start for an economy that stagnated under Muammar Gaddafi's 42-year autocratic rule.

Investors will be closely watching the outcome of the vote - with no indication of a leading contender - to see what it will mean for projects that were frozen during the fighting and for the vast opportunities likely to emerge in an oil-producing nation with the wealth to pay for construction and healthcare.

Libya's new rulers have said no major new concessions would be awarded until after the polls and are reviewing past deals.

Once elected, the new 200-member assembly will appoint a government to replace an interim administration that lacked the mandate to make major decisions, and expectations are for old projects to restart and for new contracts to be signed.

"There are a lot of projects (on standby), everyone wants to settle their projects from before," said Klaus Fodinger, head of the cement division at Austria's Asamer Holding, which resumed operations in Libya in October.

"If there are no institutions, no one to talk to, how do you settle deals from the past? The elections are a crucial event."

Many international businesses came to Libya in recent years, attracted by its huge energy reserves and a population, which although numbering just 6 million, has median incomes much higher than elsewhere in the region.

But the eight-month NATO-backed uprising sent foreigners fleeing.

While oil companies were the first to return and have helped Libya climb back close to pre-war output levels of 1.6 million barrels per day, others have not been as fast.

Government trade delegations from around the world have visited, vying for future contracts. As commercial flights have resumed, businessmen have also jetted in for short stretches. Most companies which had a foot in Libya before have mainly wanted to get their ventures back up and running as they await a clearer political and legal landscape.

Tarek Alwan, managing director of London-based consulting firm SOC Libya, said he had been approached by numerous companies seeking guidance on how to enter the Libyan market.

"Major ones are seriously interested but they have not committed yet because the situation is not fully stable, economically and politically," he said.

"They have been waiting for the elections so this will give them some sort of assurances that there will be proper elected (authority) to represent the country."

WAITING FOR THE GREEN LIGHT

Major construction, such as residential property and hotels, as well as transport projects are untouched since last year, awaiting the green light from the authorities to restart.

"Despite the fact that most major public-sector projects are on hold, there is nonetheless a great deal of planning going on across many ministries and government agencies, and this is a positive sign," said Alex Warren, of research and advisory firm Frontier, which runs The Libya Report business site.

"It suggests that once an elected government is in place, then many projects look set to start or be resumed."

The question is how quickly they will resume. The fasting month of Ramadan, when daily life usually slows, begins shortly after the elections.

The assembly is expected to be named at least two weeks from July 7 after ballot counting is finalised and an appeals process. Within 30 days of its first meeting, it will appoint a new prime minister who will form a government.

"For major projects and contracts, I don't see it really picking up, in terms of new tenders or companies returning, until the last quarter at the earliest," Warren said.

The election is expected to lead to reforms and investors want to know what those policies will be. In May, the economy ministry issued a decree enabling foreign companies to set up joint ventures, branches and representative offices in most sectors, more easily.

"Businesses are looking with great hopes towards the elections," David Bachmann, head of the commercial section at the Austrian embassy in Tripoli, said.

"However, they are aware that probabilities are high that even after the elections it might take some months - hopefully not years - before decisions are taken."

While public sector entities await, the private sector is flourishing, especially trade. Tripoli's port is heaving with activity and foreign produce is stocked on supermarket shelves. A cash crisis has eased and shops and cafes have re-opened.

Monoprix Tunisia, an affiliate of the French supermarket chain, wants to start opening 10 stores in Libya from late 2012, after uprisings in both countries delayed earlier plans.

On the construction side, small-scale private projects have taken off - homes are being built, businesses being refurbished.

HUGE POTENTIAL; SECURITY RISKS

Austria's Asamer, which operates cement factories in Libya through a joint venture, has gradually increased production since January.

"We see a huge potential - there are the needs of young population and a lot of infrastructure to be reconstructed. We expect a boom in construction activity," Fodinger said.

Gaddafi isolated Libya's economy from much foreign competition, reserving licences and contracts for his own circle, so the prospect of a more open market is attractive to new entrants.

Dependent on oil, Libya needs basic infrastructure development as well as investment in property, consumer industries and telecoms after a fifth of transmitter stations were destroyed in the war. It will also need foreign investment and expertise to increase oil and gas production.

Its tourism industry is largely unexplored, despite stretches of beaches and well-preserved Roman ruins.

Various fairs drawing international businesses have allowed companies to cultivate relations. Industry Minister Mahmoud Al-Ftise said there were plans to increase privatisations, and Libya was interested in more foreign investment.

"We would like to have a participation from foreign and local private business so we can see results because we would like to have competition among the business," he told Reuters.

However security remains a concern. Bouts of violence are deterring foreign firms from bringing back all their expatriates on the ground for now. For those who were once used to living in villas or flats in Tripoli, they now find themselves confined in secure compounds without their families.

Many businessmen travel with security advisers.

Libya's interim government has struggled to impose its authority on a country awash with weapons. Attacks on diplomatic and aid missions in the east have highlighted the ongoing volatility.

Last month, Tripoli's international airport was seized by an armed group for several hours.

"Security is a concern and when you hear of such violent incidents as we have recently, you worry and it may deter some foreigners from coming here," one European businessman said during a recent trip to Tripoli.

"But you have to weigh the risks against the opportunities."

Source: Reuters 

Libyan Ministry of Health explores collaboration opportunities with Dubai Healthcare City

A high-ranking delegation from the Libyan Ministry of Health visited Dubai Healthcare City (DHCC) to raise awareness about the status of the Libyan healthcare sector and engage in dialogue with healthcare institutions in the UAE.

Headed by the Libyan Deputy Minister of Health, His Excellency Dr Omran Turbi, the delegation comprised Dr Amal Naagi, the Ministry's Head of Medical Exhibitions, Dr Ashraf Shembesh, Director of Medical Services, and Dr Fauzia Tushani, Director of Media Relations. 

During their visit, the visiting officials hosted a seminar on 'Opportunities in the Libyan Healthcare Sector' to highlight the revolution's impact on healthcare services in the country and underline the requirements that were urgently needed for rebuilding the system. 

Dr Ayesha said: "DHCC is pleased to support the Libyan Ministry of Health. The seminar served as a strategic platform to increase cooperation between the Libyan Ministry of Health and the healthcare community in Dubai. It also helped to educate healthcare providers and professionals from the UAE and the Gulf region on the healtcare requirements in Libya."

The DHCC team led by Dr Ayesha Abdullah offered the delegation a tour of the healthcare park and provided a brief outline of the history, vision and achievements of the free zone.

Source: ameinfo.com

www.soclibya.com 

Qatar's QNB acquires 49% stake in Libyan bank

Qatar National Bank (QNB) Group on Saturday announced it had acquired of a 49 percent stake in Libya's Bank of Commerce and Development.

The Benghazi-based bank approved QNB Group as a strategic partner, according to a memorandum of agreement signed between the two institutions.

Ali Shareef Al-Emadi, QNB Group CEO, said the move was in line with the company's strategic "plan of international expansion in selected and promising markets".

Jamal Abdelmalek, chairman of The Bank of Commerce and Development, said the agreement would result in an "increase in the bank's capital, which will support its financial position and its ability to expand in the Libyan market".

The Bank of Commerce and Development was established in 1995 and has a network of 32 branches supported by 82 ATMs, with nearly 820 staff. The bank's total assets are $2bn.

Under the deal, QNB Group will provide administrative and technical services for the operations of the Bank of Commerce and Development.

QNB Group achieved strong financial results for the first quarter of 2012 with a net profit of QR2bn, up by 17.4 percent compared to the same period last year.

Total assets increased by 28.2 percent since 31 March 2011 to reach QR311.1bn, the highest ever achieved by the Group.

QNB, which employs nearly 7,000 staff, provides banking services through 335 branches and offices with an ATM network of more than 650 machines.