By George Grant.
Tripoli, 20 November:
The United Kingdom has partnered with Turkey to provide joint expertise as part of an innovative bid . . .[restrict]to win new business contracts in Libya.
This is the first time such an initiative has been attempted by the two countries inside Libya. Sixteen British companies are currently in Tripoli for a three-day visit to showcase their expertise together with 15 companies from Turkey.
“Clearly, Libya has a challenging infrastructural time ahead of it”, said Kevin Cunningham, head of UK Trade & Investment in Libya. “The Turks have a good foothold in the market and offer a very competitive pricing structure as a prime contractor. British companies clearly have a lead in the more innovative design end of construction, project management and the more specialised end of engineering.
“We see this as being a very good mix between the two to get what is meant to be a very good product at a very good price”.
Amongst the services that can be offered by the partnership, Cunningham says, are expertise in high-end technology, oil and gas, healthcare, education and a range of other infrastructure development projects.
As an example of how the partnership could work in practice, Cunningham cites the example of a power-generation facility wherein the majority of construction work, such as concrete pouring and other day-to-day building would be done competitively by Turkish contractors, whilst the design of the facility, the engineering and project management would be handled by the British.
In raw economic terms, Libya represents a potentially attractive destination for foreign investors, in particular at a time of sluggish economic growth in Europe and elsewhere.
In July, the International Monetary Fund estimated that Libya’s real GDP growth in 2012 would be 116 per cent. In its October forecast, that figure was revised up to 122 per cent, with 16.7 per cent growth forecast for 2013. The IMF has said that inflation for all of 2012 should be down to 10 percent and to an almost negligible 0.9 percent next year.
For its part, UKTI has designated “Libya Reconstruction” as a High Value Opportunity, the only country in the world to receive this designation, which is ordinarily reserved for specific infrastructure projects such as railways or major sporting events.
According to Cunningham, “there is a recognition that Libya is a unique market. It’s seldom that what is effectively a new country emerges on the southern shores of the Mediterranean. It is a country that’s looking towards Europe rather than away from Europe, it is a country with a small, young and very vibrant population, it has oil revenues and it wants to create its place in the world. “
In recent months, however, security concerns coupled with political uncertainty have held many foreign companies back. Also problematic was the fact that the interim government of Abdurrahman Al-Kib showed itself highly reluctant to sign-off on major contracts that went beyond immediate needs, regarding that as beyond its mandate as an unelected and transitional body.
It is hoped that the Zeidan government will demonstrate a greater readiness to green-light new business contracts, with Zeidan emphasising on Sunday that development of the Libyan economy is amongst his main priorities.
Most of the companies at current the UK-Turkey Libya construction mission admit they are only in the early stages of entering the Libyan market. “Preliminary research into market potential”, and “meeting potential new customers” constitute the main reasons given for travelling to Libya now.
Nevertheless, overseas business interest in Libya does now appear to be on the rise. Today also marks the first full day of the Libya Summit, a major business convention in Tripoli bringing together some 300 representatives from across the world.
That event, which seeks to address a range of critical needs including the future of the Libyan private banking system; the legal framework and requirements to start up in Libya; resuming water treatments in Libya; and rebuilding the healthcare sector, concludes on Thursday 22 November. [/restrict]