By Sami Zaptia.
London, 25 August 2020:
- Turkish companies to be given priority in business contracts
- Turkey’s military support against Hafter rewarded with business ”dividend”
- Electricity contracts to be prioritized
- Talks with Turkish companies are positive
- Turkish companies returning ‘‘soon’’
- GECOL has met Turkish company’s security demands
In the clearest indication yet that Turkish companies will receive favourable Libyan treatment in business contracts, Faiez Serraj, the internationally recognized Libyan prime minister, said Turkish companies will return ‘‘soon’’ to complete some of their stalled contracts.
During a pre-recorded speech last night, Serraj made no effort to hide the fact that this Turkish favouritism was a political dividend to Turkey for the support it had given his government against the Khalifa Hafter attempt to militarily take Tripoli.
Speaking specifically about electricity projects, Serraj said that talks had been positive with Turkish companies such as ENKA and others about their return.
Revealingly, but without giving further details, he claimed that [restrict paid=”true”] the state General Electricity Company of Libya (GECOL) had ‘‘fulfilled their security demands’’.
He made no mention of the issue of the payment of old debts. However, speaking to representatives of companies with existing stalled projects in Libya, it was made clear to Libya Herald that companies would not return to resume their projects in Libya without some sort of favourable agreement on payment. This would need to satisfy some mechanism for the settlement of old debts and guarantees that new debts would also be paid.
It is difficult to over speculate about this issue, however, the issue of security for foreign contractors is an issue of paramount importance.
Whilst different companies from different countries of the world have different security thresholds, a return of Turkish companies to Libya would be watched closely by other companies with stalled contracts in Libya. If a workable formula is reached in Libya, other companies from other countries will be studying it closely to see if it can be replicated for them.
It will be recalled that Libya and Turkey signed an MoU on 13 August this year. The agreement was part of cooperation between the two countries to complete 184 stalled Turkish construction projects in Libya estimated at US$ 16 bn.
Speaking at a press conference after the signing event, Tripoli’s Planning Minister, Taher Al- Jahemi said Turkey had the ‘‘lion’s share” of projects in Libya. ‘‘Turkey has infrastructure projects in Libya estimated at 20 percent of the total existing projects contracted between 2008-2012, which is one of the largest shares for countries with projects contracted with the Libyan state, estimated at 184 projects’’.
It will be recalled that Turkish companies were forced to leave Libya in 2018 when three engineers were kidnapped and held hostage for eight months before finally being released.
But it must also be borne in mind that since the 2011 Libyan revolution there have been numerous reports or announcements that companies were about to return to Libya to complete their stalled projects. At the end, the issues of the lack of security and lack of payment for old debts have prevented any company from making a serious long-term return
(see links below for detailed reports over the last eight years of announcements of agreements on payments of debts and the return of foreign contractors).