by Reza Akhlaghi
In a report highlighting political and economic prospects of a new, post-Qadhafi Libya, the Economist Intelligence Unit, the in-house research unit of the Economist magazine, explains what world and business leaders should expect over the next twenty months in this oil-rich north African country.
The report, entitled Libya’s Year Zero, offers a number of scenarios on the political prospects of the country under the leadership of the National Transitional Council (NTC) and continues with highlighting important economic policies that can be expected of the Council. While striking a largely positive tone on a new emerging Libya, the report nevertheless warns its readers of lack of any guarantees on the full success of the NTC administration. The report, for example, emphasises the potential for infighting among NTC officials as it is partly made of former regime officials, something seriously frowned upon by certain rebel leaders. Also, the report explains why Islamic tendencies of certain rebels do not necessarily herald the evolution of a Taliban-style regime in Libya.
On the economic scene, according to the report, one of the main challenges facing the Libyan economy is the absence of a strong private sector that can stand on its feet to take on various emerging opportunities and development projects. This, according to the report, is due to long-standing crony capitalism and strong nepotism under the Qadhafi regime, which has also made its mark on the country’s under-developed financial sector.
Pointing to the country’s decades-long isolation from world markets and foreign investment, the report explains what factors can contribute to the development of the country’s non-oil sector such as telecommunication, tourism, power and water.
Though the report does not talk about the impact of Qadhafi’s fall on economic and geopolitical interests of other major powers such as China and Russia and how such powers might react to the potential loss of their interests there, it is nevertheless essential reading for multinational companies that strive to become part of the reconstruction of the new Libya and the country’s emergence from decades of economic and political isolation.
Libya’s Year Zero can be downloaded here.