Libya's socialist-oriented economy depends primarily upon revenues from the petroleum sector, which contributes practically all export earnings and over half of GDP. These oil revenues and a small population give Libya one of the highest per capita GDPs in Africa. Since 2000, Libya has recorded favourable growth rates with an estimated 8.1% growth of GDP in 2006.
|Year||GDP||USD to LYD|| Inflation Index|
(2000 = 100)
1. For purchasing power parity comparisons, the US Dollar is exchanged at 0.77 Libyan Dinars only.
Average wages in 2007 hover around $53-65 per day.
Falling world oil prices in the early 1980s and economic sanctions caused a serious decline in economic activity, eventually leading to a slow private sector rehabilitation. At 2.6% per year on average, real GDP growth was modest and volatile during the 1990s. Libya's GDP grew in 2001 due to high oil prices, the end of a long cyclical drought, and increased foreign direct investment following the suspension of UN sanctions in 1999. Real GDP growth has been boosted by high oil revenues, reaching 4.6% in 2004 and 3.5% in 2005. Despite efforts to diversify the economy and encourage private sector participation, extensive controls of prices, credit, trade, and foreign exchange constrain growth.
Although UN sanctions were suspended in 1999, foreign investment in the Libyan gas and oil sectors were severely curtailed due to the U.S. Iran and Libya Sanctions Act (ILSA), which caps the amount foreign companies can invest in Libya yearly at $20 million (lowered from $40 million in 2001). As of May 2006, the U.S. has removed Libya from its list of states that sponsor terrorism and has normalised ties and removed sanctions. This clears the road for U.S. oil companies to exploit Libyan oil and is expected to have a positive impact on the Libyan economy. The NOC hopes to raise oil production from 1.80 million bpd in 2006 to 2 million bpd by 2008. FDI into the oil sector is likely, which is attractive due to its low cost of oil recovery, high oil quality, and proximity to European markets. Most Libyan oil is sold on a term basis, including to the country's Oilinvest marketing network in Europe; to companies like Agip, OMV, Repsol YPF, Tupras, CEPSA, and Total; and small volumes to Asian and South African companies.
|Proven Oil Reserves (2007E)||41.5 b/bbl|
|Oil Production (2006E)||1.8 mmbd (95% crude)|
|Oil Consumption (2006E)|
|Net Oil Exports (2006E)||1,525 Mbpd|
|Crude Oil Distillation Capacity (2006E)||378 mbpd|
|Proven Natural Gas Reserves (2007E)||52.7 tcf|
|Natural Gas Production (2006E)|
|Natural Gas consumption (2005E)|
1. Energy Information Administration (2007)
WOC's Waha fields currently produce around . In 2005, ConocoPhillips and co-venturers reached an agreement with NOC to return to its operations in Libya and extend the Waha concession 25 years. ConocoPhillips operates the Waha fields with a 16.33% share in the project. NOC has the largest share of the Waha concession, and additional partners include Marathon and Amerada Hess.
Libya has five domestic refineries:
|Ras Lanuf Refinery||220,000||Rasco|
1. Amounts in barrels per day.
In 2007, mining and hydrocarbon industries accounted for well over 95 per cent of the Libyan economy. Diversification of the economy into manufacturing industries remain a long-term issue.
Although agriculture is the second-largest sector in the economy, Libya depends on imports in most foods. Climatic conditions and poor soils severely limit farm output, and domestic food production meets only about 25% of demand. Domestic conditions limit output, while higher incomes and a growing population have caused food consumption to rise. Because of low rainfall levels in Libya, agricultural projects such as the Al Khufrah Oasis rely on underground water sources. Libya's primary agricultural water source remains the Great Manmade River (GMMR), but significant resources are being invested in desalinization research to meet growing demand. Libyan agricultural projects and policies are overseen by a General Inspector; there is no Ministry of Agriculture, per se.
The Government is in the process of preparing a financial sector reform program. Recent legislation setting corporate governance standards for financial institutions makes progress towards better management and greater operational independence of public banks. However, Libyan public banks still lack management structures supported by skills in critical areas like credit, investment, risk management, and information and control systems. The new banking law reinforces the independence of the Central Bank of Libya (CBL) and offers a legal framework for regulating banking activities, even if some provisions call for improvement. Despite progress brought by the new banking Law that specifies and limits its duties and responsibilities, the CBL remains the owner of the public banks, with the associated potential conflict of interest between ownership and regulation.
Financial sector reform has also progressed with partial interest rate liberalization. Interest rates have been liberalized on deposits, while a lending rate ceiling has been set above the discount rate. The Libyan Stock Exchange, established in 2007, is the first exchange of its kind in the country.
Industrial production growth rate: NA%
Electricity - production: 14.4 billion kWh (2003)
Electricity - production by source:
fossil fuel: 100%
other: 0% (1998)
Electricity - consumption: 13.39 billion kWh (2003)
Electricity - exports: 0 kWh (2003)
Electricity - imports: 0 kWh (2003)
Agriculture - products: wheat, barley, olives, dates, citrus, vegetables, peanuts, soybeans, cattle, corn
|Heritage Foundation/The Wall Street Journal||2006 Index of Economic Freedom||152 out of 157|
|The Economist||The World in 2005 - Worldwide quality-of-life index, 2005||70 out of 111|
|Energy Information Administration||Greatest Oil Reserves by Country, 2006||9 out of 20|
|Reporters Without Borders||Press Freedom Index (2007)||155 out of 169|
|Transparency International||Corruption Perceptions Index 2007||131 out of 180|
|United Nations Development Programme||Human Development Index 2005||58 out of 177|