A new economic sector

Libya's policy shift to reintegrate itself into the mainstream of the international community has the potential to attract a lot of economic activity in the Mediterranean region.

My assessment is that this change is not a tactical one made for a temporary period, but a strategic decision that will be permanent. My observations are that the changes in the economic sector have been very deep and are being made very fast.

The alignment of the dinar, the winding up of most of the public corporations that used to deal in all commodities consumed in Libya, the plans for privatisation, the removal of subsidies, the push for productive work, the fast expanding private sector, are all clear and loud indications that Libya is on an irreversible path towards a market economy.

This is generating a lot of interest worldwide. We have seen foreign government leaders visit Libya to assess and re-establish contact. Naturally, this comes in the wake of their businessmen insisting for doors to be open and business to recommence.

A new business class

Libya is building its own business class. There has been a gradual liberalisation which has seen thousands of small businesspeople venture in the international market, sourcing goods which they could trade in their country. Now that most of the public companies that used to be responsible for the importation of all consumer goods and commodities in Libya are no more, the trading and business class in Libya will increase.

Another boost to local private enterprise will be given through the first wave of privatisation that will happen in Libya and which will comprise small public companies which could be bought only by Libyans. This is a wise plan to strengthen the sinews of the local business community before the major influx of foreign investors that is expected.

Developing economic sectors

The sectors that will be the target of investment in Libya will be various. High on the list will be the oil sector, where many companies which operated in Libya before nationalisation would want to renegotiate their position, and where new investors will try to get the new concessions that will be on offer.

Others will undoubtedly be the energy sector, the communication sector, the tourism sector, and the manufacturing sector which will build on existing plant and new factories to satisfy the need for capital goods needed in the development and for the increasing demand in consumer goods. It should be noted that the African market can be well served from Libya.

Benefit to Malta

I believe that all this can be put to the benefit also of our country. We still remember the days when foreign companies operated in Libya and used to use Malta as a location where the families of those working in the oil sector there used to be housed.

Today Malta can offer much more than that. We have developed a manufacturing and service sector that can assist companies in their entry strategy to Libya and that can give the necessary facilitating and logistical support.

Knowledge based on decades of experience in operating in Libya, as well as the sensitivity that we Maltese have to the Libyan culture, make Maltese consultants and businessmen ideal partners to many, especially smaller companies, who will be venturing in this new, lucrative market.

Visit to Houston

Last week, together with my colleagues John Lowell, Ambassador to the US, and George Saliba, ambassador-designate to Libya, I was in Houston, Texas, to discuss these interesting developments with various companies, their future plans, and the way Malta can be part of their plans.

The outlook is very optimistic, and many are ready to move if not already on the move. After talking to them they realise that Malta makes sense and I am optimistic that we will see some of them visiting Malta in the next few months. This is an activity that can create jobs as well as other spin-offs in the economy in sectors such as retailing, property, leisure and air travel.

As all other ideas that are worth-while this needs nurturing with creative action. It also needs guarding against abusive pricing that turns customers off.

This is a new economic sector which if successful will bring prosperity to our shores.

John Dalli, Minister of Foreign Affairs and Investment, has for 16 years been co-chairman of the Libyan-Maltese joint commission and is considered an expert in Libyan affairs.

www.johndalli.com