Around the rebel campfires that lit up the night sky in mid-revolution Libya, lads from Leeds, Birmingham and Glasgow sat alongside their Arab comrades.
Such was the strength of feeling among Britain’s Libyan community in the Arab Spring that hundreds of young men returned to their motherland to join the Gaddafi overhaul.
Robin Lamb (pictured left with two soldiers) was a keen observer and he recalls a common joke doing the rounds in expat circles at the time about the Mancunian nature of many rebel units.
As director general of the Libyan British Business Council (LBBC), he visited Libya before and after the revolution and explains that for all the new opportunities that have emerged for his 150+ members, there are numerous challenges to be overcome.
He believes, however, the Libya’s close ties with Britain – that drove British citizens to defend a land many of them had never visited - and historical links that extend as far back as the Roman Empire, hold the key to UK businesses tapping into a newly opened market.
“Our long-standing bilateral relationship is remembered by older Libyans and even under the Gaddafi regime one of his ministers told me that Libya is the only Anglophone country in North Africa, with the two nations having fought alongside each other in World War II.
“Then you’ve got the good will towards the UK which is reproduced in the younger population. Thousands of young Libyans study in UK and when Gaddafi nationalised the whole private sector, a lot of Libyans came to Britain and rebuilt their businesses. You now have young British Libyans who know how Britain works and want to have a foothold in both places.
“In more recent times, through the RAF and prominent role that Cameron took during the revolution, there is a lot of gratitude for the part the UK played. So we have long term and short term goodwill both working for us.”
Of course the removal and ultimate bloody death of Gaddafi does not wash away the sins of the past. The spectre of Lockerbie still looms large, while recent televised footage of British war graves being destroyed serve as a stark reminder of the struggles ahead.
But there is still business to be done with Libyan firms in the short and longer term. According to Lamb, that these firms value longstanding relationships could well play into the UK’s favour.
Unlike negotiations that are thrashed out in most European boardrooms every day, carefully nurtured relationships can hold more sway in Libyan business than corporate factors like brand identity, cost and logistics.
“Although there may not be major contracts available in Libya immediately, it’s time for businesses to go there now. Libyans like to do business with people they know and trust so you build a good relationship and don’t just go in and say ‘these are my goods, lets sign a contract’. It doesn’t work like that. In Libya they want to know you first. So the time has come to do that and start making those contacts with a view to winning loner term contracts.”
Such contracts might include those previously awarded by Gaddafi to old foes of the western world which are now in limbo. Russian and Chinese parties shared several multi-billion pound contracts that remain incomplete to develop high speed rail links across the country which are now shrouded in doubt according to Lamb.
Although Lamb urges business leaders with an eye on the Libyan market to start fostering relationships now, current financial and political uncertainty decrees that immediate business opportunities are mostly military in nature.
Lamb says: “There are things to be done now which the Libyans need expert assistance with, such as de-mining unexploded ordinance. There is also a need for a centrally organised army and police force. These things require training and that is something the British government and private sector have an expertise in. Basically getting rid of things that go bang and training people to look after traffic, CID and that sort of thing are all opportunities for the UK.”
Before the heavyweight infrastructural, healthcare and oil and gas supply chain contracts are up for grabs, though, there is much to be resolved.
Given its status as the least diversified economy in the Middle East and North Africa, as viewed by the IMF, there is undoubtedly huge room for growth in several key sectors – something which is not lost on the Libyan people.
But, as Lamb sets out, a nation’s business regulations, investment and public purse cannot be overhauled as quickly as an unpopular dictator. Long after Gaddafi’s passing his anti-business policies, non-productive investments and corrupt network of supporters continue to live on. Untangling this mess will take time and money.
“The Libyans themselves want to start developing their economy, diversifying it and creating jobs for their people so there is a lot of new build as well as a lot of old build to make good and a lot of services to develop which all means trying to find new areas in which they can push forward economic activity.
“The Libyans are very ambitious in what they want to do and they are gradually getting to a position where they have the money to apply to their priorities but one major hurdle that they have to overcome, which may mean the big new business won’t happen for a few months, is the fact that they have a revolutionary government. Although it is recognised internationally as being a legitimate government, it doesn’t really have much of a domestic mandate because it is self-appointed [and] that put something of a break on decision making.”
In the aftermath of last year’s conflict, Libya has been quick to restore its oil and gas sector to working order and most recent reports suggest that it is already up to 1.4 million barrels a day of production – a feat that has outstripped many analyst predictions. With a traditional 90 day lag between oil being exported and the ultimate earnings reaching its producer – in this case an investment-hungry nation – even oil revenues will take time to bolster Libya’s spending power. They will also not feed the deep thirst for private sector job creation that exists in a country in which 60% of the working population were employed by the previous Government. The sector traditionally generates around 100 jobs per US$1bn of investment.
Other significant barriers to Libya’s economic revival and emergence as a nation with a potentially thriving private sector include the yet-to-be-lifted international sanctions preventing the Libyan Investment Authority from flexing its muscles. Then there is the puzzle of unlocking the many investments which the Gaddafi regime fed into parts of Africa and into corrupt partners posing as developers.
“The Libyan authorities now have to disentangle these things and retrieve their national shares in some of these investments,” says Lamb. “So they’ve got a lot of complications but when they do have control of all these funds the Libyan Investment Authority will also have access to a $US20bn infrastructural fund,” he adds. But there are also legal stumbling blocks holding up the economic revival.
“At the moment Libya is still operating under business laws that were put in place by Gaddafi because they can’t make new laws until they have a legislature that’s been elected.” An election is planned in June, although current ongoing unrest suggests the road to a democratically elected government will be far from smooth.
Despite the many challenges, however, Lamb believes British business should be excited by the market that Libya has the potential to grow into for their goods and services. Last year the level of UK exports going to Libya dipped 77% on the previous year to £86.4m while imports dropped 68% to 418.6m – so clearly there is ground to be restored as well as new trading channels being forged.
English teachers and learning resources are an immediate requirement. “For over 20 years Gaddafi banned the teaching of English and this was only resumed recently,” says Lamb.
More lucrative opportunities exist in the healthcare industry. With around 4,000 Libyan doctors currently working in the NHS, cross-border ties are already flourishing in the sector and many collaborative projects are well underway.
“In the longer term there is always more that can be done to upgrade major infrastructure like roads and ports. With the airport in Tripoli, for example, there was already a project in place to upgrade it which was moving very, very slowly. Libya is a large country with some large distances to cover so internal flights are quite important and there a few towns that would benefit from an airport.”
Sitting at the bottom of the diverse economy league table in a region which is particularly reliant on oil and gas and less diversified than most parts of the world does not sit well with Libyan industrialists looking to secure a brighter future.
Tourism has been earmarked as an area of huge potential, but significant decisions are yet to be made on how to kick-start an as yet dormant sector.
“The Gaddafi solution for generating employment was to give people poorly paid jobs in state. But another solution is tourism, which generates a lot of jobs [in relation to other sectors].
“Libya has two very strong assets – the most spectacular Roman and Greek remains along its coast and 2,000 kilometres of Mediterranean coastline which offers the potential for holiday resorts that are pretty much nonexistent at the moment.”
But Libya’s tourism stakeholders are yet to decide whether they follow the path of the MENA region’s most tourist-friendly destination, Dubai, or carve out a niche as a ‘dry’ destination which caters for Muslims. Or perhaps the answer lies somewhere between the two.
“Dubai is one way of doing things but most Arab countries would not want to do it like that. If you look at Oman, which is next door to the UAE, they’ve gone for higher end tourism. It’s conceivable that that is the way Libya could go. There are Islamic movements in the new Libya that don’t want to be dominated by others and want to do things in a very Islamic way.”
Whichever way tourism manifests itself in Libya, UK firms are likely to play their part in making it happen. “More hotels will be needed and they will need to be designed and built and need interiors, furnishings and lighting. The UK has been successful at these types of overseas projects in the past and could be a lead area for us.”
While many UK firms that had a presence in Libya have cut their losses after missing out on a year of business, others are now starting to return and UKTI and the LBBC are actively planning trade missions.
Meanwhile, Libya’s private sector – which is only 15 years old in its current form – is starting to overcome the fear factor that existed under an unpredictable dictatorship that could change the rules at any time.
There remains many issues to be resolved in a nation struggling to get back on its feet. But Lamb believes now is the time for UK firms to at least take a look at the opportunities on offer – and they might be surprised by what they find.
For more information on how the LBBC can help your business tap into the Libyan market visit www.lbbc.org.uk or email firstname.lastname@example.org.
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