Market of the Month - Libya
Libya - Open for U.S. Business following 20 Years of Economic Sanctions
Best Prospects for U.S. Exporters
Contact Us Today to Connect with a World of Opportunity!
Libya has one of the highest per capita gross domestic products in Africa ($14,400), and the government has budgeted over $80 million for infrastructure development, focusing on several large projects for residential housing, highways, railways, telecommunications, and irrigation.
Libya’s government is making efforts to diversify the economy and encourage private-sector participation in new manufacturing and service activities. As Libya moves forward with its transition, the country holds potentially rich trade opportunities in almost every sector of the economy, including oil and gas, agriculture, telecommunications, medical equipment and services, education, and tourism.
Two-way trade between the U.S. and Libya has surged since April 2004, when U.S. sanctions on Libya were eased, from $18 million (solely U.S. wheat exports) to $4.9 billion in 2008. In 2008, U.S. exports to Libya amounted to $721 million, consisting mostly of machinery, vehicles, iron/steel, cereals, and electrical machinery.
In Libya’s business culture, deals are made on the strength of personal contacts. U.S. exporters can use the services of the U.S. Commercial Service to open doors and receive valuable guidance on entering the market. Listen to an Audio Market Brief about Libya with our Senior Commercial Officer, Diane Jones.
U.S. companies can also take advantage of a U.S. Department of Commerce-led Executive Trade Mission to Libya and Algeria, November 4-8, 2009, to pursue business opportunities. Visit the North Africa Mission web site for more information and to apply by August 1, 2009.
Libya has been largely isolated from the world economic crisis due to a healthy financial reserve. The country is currently in the midst of a five-year, $123 billion infrastructure and public works project.
Following four years of brisk economic expansion due to buoyant oil prices and foreign investor interest, Libya’s GDP growth is expected to decline slightly this year to 5.1 percent because of weak world hydrocarbon prices. However, growth is projected to rebound to 6.1 percent in 2010 due to higher export margins.
Al-Masjid Al-Ateeq, Awjilah
Best Prospects for U.S. Exporters
Energy: Drilling and seismic equipment, pipeline technology, engineering and geology expertise, construction, environmental services, communications, personnel services and training.
Electrical Power: Power plant upgrades and new construction, project management, engineering services. The General Electric Company of Libya estimates that demand is growing at 20% per year.
Infrastructure: Engineering, architectural design, advanced construction techniques, major project coordination, construction management. The government of Libya is currently engaged in major road building projects, airports, office complexes, hotels, infrastructure projects, residential housing, and tourist complexes.
Transportation: There are opportunities for U.S. vehicle manufacturers – from aircraft to farm machinery – to make substantial sales in Libya. There are also great needs for improving Libya’s transportation infrastructure, which could provide substantial investment and sales opportunities for U.S. companies in the years to come.
Information Technology: The General Post and Telecommunications Company (GPTC) has announced its intention to spend $10 billion on telecommunications infrastructure over the next 15 years. GPTC has also expressed interest in U.S. technology, and U.S.-furnished centers for training and software certification. The potential privatizations of the country’s two mobile carriers could offer opportunities, depending on terms and conditions.
Environment: There will be a large demand for desalination technology in Libya over the coming years. Several hundred million dollars worth of water, wastewater treatment, and desalinization contracts are expected to be awarded over the coming few years. The Great Man Made River project may offer opportunities for large contracting firms.
Safety and Security: While U.S. firms need to be aware of U.S. Government restrictions on the export of certain security-related products to Libya, opportunities for U.S. suppliers are projected to increase as Libya steps up efforts to improve border control and protection of public and private facilities. There is growing interest in systems for access control, identification, facilities monitoring and management, computer protection, and visual warning and location, among other applications.
Temple of Zeus, Cyrene, Lybia
In Libya, it is important to identify a well-qualified and well-connected local partner who can learn about new opportunities. U.S. firms must enter the Libyan market with an understanding that the process takes longer than average to materialize and that significant cultural differences heavily influence business.
Libyans prefer to deal with U.S. companies directly. They also want to see U.S. companies and products return to the country, and want U.S. citizens to return as well. Libyans may be offended if you choose to assign someone as general manager or local representative who is not a U.S. citizen or a Libyan.
U.S. firms would be wise to make it a point to demonstrate that they are interested in doing business with Libya for the long-term, incorporating local employee training and technology transfer programs. This is particularly important for government bids, as the government seeks to re-tool and re-assign workers.
CS Libya produces market research reports to help U.S. companies determine market potential, market size and potential competitors. Visit our site to access our reports.
Contact Us Today to Connect with a World of Opportunity!
Key Contact: Diane Jones, Senior Commercial Officer
U.S. Commercial Service
American Embassy – Libya
Tel: 218-91-363-0537