Interesting piece from MEED vis a vis Tripoli’s $54bn, 20-year commitment to develop joint ventures with multinational firms in order to transform the Gulf of Sitre–and namely the oil-rich industrial cities of Marsa el-Brega and Ras Lanuf–into energy hubs founded on oil and gas processing and distribution, as well as into a resort destination.  The two cities lack proper downstream investment, but the potential returns on FDI are enormous, gushed a source from the U.S. engineering firm Fluor Corporation, which was commissioned to oversee the project:

“Libya is virgin territory. It is coming out of a long embargo so there are great opportunities. The energy cities have these anchor investments but also provide for secondary industries, which take products from the heavy industries and produce plastics, for example. They also provide work for industrial and construction services. There is a much greater, wider and more open opportunity for investment, from oil and gas to secondary industry and services.”

As with many if not most frontier economies, one primary issue facing investors and companies alike in Libya is the country’s historical lack of ease of doing business:

“Libya has been a notoriously difficult arena for business in the past, and nearly two decades of U.S.-imposed trade embargoes between 1986 and 2004 have helped make it an unknown quantity for many international companies.”

Thus, the relative ease and quickness inwhich capital will begin to flow into Libya is largely a function of the speed and degree of regulatory reform.  Bring on the lobbyists.  In the meantime, the project’s developer–the state-controlled Economic & Social Development Fund (in lieu of the state’s energy firm, NOC), as well as the country’s development agency, the Economic Development Board, will handle coordination efforts of oil and gas, as well as promoting new tax incentives, respectively.

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