British business are ‘clamoring’ to invest in Libya, says the chairman of the Libyan British Business Council (LBBC), but they shouldn’t expect to be handed contracts on a plate and it won’t be a walk in park, he says.
Lord David Trefgarne, chairman of the LBBC, said members of his organization are keen to join him on an upcoming reconnaissance trip to the Libyan capital later this month, even with the UK’s Foreign Office advising against all travel to Libya.
“Members of the LBBC are clamoring to come with me on a mission to Libya as soon as it can be arranged,” Tregarne said. “There is keen interest to get out there and get going, but they’ll have to work hard and no doubt invest in the market before the rewards return.”
The LBBC was established in 2004 with the purpose of promoting bilateral trade and investment between the UK and Libya. It counts more than 100 member groups from a variety of sectors, including oil and gas, financial services and education.
The organization is planning a number of trips to Libya, including a visit to Tripoli in the coming weeks to assess the situation on the ground, which will be followed by a larger delegation in late September or early October where meetings could take place between British companies and Libyan entities.
Dismissing reports of preferential treatment for British companies because of the UK’s support for the NATO strike, Trefgarne said UK-based companies hoping to work in Libya will still have to compete for contracts as they have in the past. He added that he hopes the bidding process will be on a more level playing field than under Muammar Qaddafi’s regime.
“I do not think that business will be offered to British companies on a plate,” Trefarne said. “The mood music is going to be better than it was previously and I welcome that, but we will still have to compete, we will still have to make sure we are offering good value for money, so don’t think there is a great bonanza for British firms.”
In addition to the oil and gas sector, upon which Libya is almost entirely reliant at the moment, he highlighted health care and hospital services, as well as infrastructure reconstruction, as key investment opportunities.
Investor appetite may be strong and the opportunities may be varied, but the Libyan National Transitional Council (NTC) must first reassure investors that they are willing to play by the rules.
“The NTC have to persuade potential trading partners and investors that they are going to play rather more carefully by the rules than their predecessors,” Trefgarne said, referring to the fact that under Qaddafi contract terms were often changed or re-negotiated without notice.
He also mentioned that a number of British firms are currently owed large sums by the Libyan government related to their business activities under the previous regime.
“We’re hoping to resolve some of those issues, particularly now that frozen funds are by and large released,” he said, adding that he was hopeful the NTC would work to resolve any pending payments.
As for the longer-term outlook for the Libyan economy, Trefgarne expects the new government to adopt a market-driven economy, but he doubts we will see the emergence of a Western model of democracy in the new Libya.
“Don’t think a sort of Westminster model of democracy is what is going to emerge in Libya” he said.
“I daresay it will be something rather different, but above all it will have to provide for the people of Libya to decide how they want to governed and by whom.”
(Carina Kamel is a senior correspondent for Al Arabiya Business news based in London and can be followed on twitter @carina_bn.)