Libya: The economic potential of a failed state

In Berlin, the international community has looked into the fate of Libya. Behind the endless political struggle lies an obvious economic potential.

berlin libya summit
At the Berlin summit, world leaders pledged to end foreign interference and work towards a "permanent ceasefire". @ All rights reserved

The international community knows this: Libya is a model of a failed state. But a failed state with potential. Nine years since the start of the Arab Spring, which saw a wave of upheaval in regions of the Middle East, its full impact has largely not been gauged. Many countries which saw citizens rise up against authoritarian regimes faced and continue to face strong political and economic headwinds, irrespective of whether they were lucky enough to successfully depose these regimes, which when disposed left a chaos in their wake midst which were shoots of aspiration towards a democratically elected government. Libya is one such nation which is struggling to create unified, durable democratic institutions following decades of chaos under strongman Muammar Gaddafi.

While the campaign to depose Colonel Qadhafi has been relatively fast paced with predictable outcome, the great unknown however has been who will nurture and curate the aspirations of the people to create a stable democracy as well as a prosperous economy. The ad hoc nature of the rebel coalition, which bundled together various warring splinter groups, introduced two possibilities. On the one hand they could come together and create a representative government or continue to engage in violent reprisals against each other.

Forming a government

With a lack of clear public articulation from NATO with regard to the reconstruction of Libya, the country has two competing governments claiming executive authority. The great challenge facing Libya is not the equitably division of Libya’s abundant natural resources or the division of authority between its national and local government but rather the competing federal entities for control over the central government. Libya’s top priority should be the creation of a single unified government which operates with the consent of its people under the auspices of a democratic constitution.

According to Khaled Al-Meshri, President of the High Council of State of Libya, who since April 2018 has chaired the High Council of State and has been working towards a constitutional referendum in Libya, despite the structural challenges, there is room for optimism.

Speaking on the difficulties resulting from the breakup of Libya’s House of Representatives (HOR), a legislative body seated in the city of Tobruk that rejects Tripoli’s authority and the United Nations-backed Government of National Accord (GNA), Al-Meshri said, the High Council of State also has to grapple with General Khalifa Haftar and his Libyan National Army (LNA) which is aligned with HOR and has been active in the east and south of Libya.

Matters become more complicated since the GNA is also being challenged by various militias and extremist groups which try to capitalise the situation through destabilization by operating outside the purview of Tripoli’s control.

Fighting each other

Underscoring the importance of reconciliation and bridging the gap between Tripoli and Tobruk,  Al-Meshri highlighted the need for reconciliation between Tripoli and Tobruk and despite lingering tensions, he remained optimistic that both sides are now convinced to put an end to the recurring cycle of violence.

Much of this cycle of violence can be traced back to a long history of colonization in the 1950s and 1960s, followed by Qadhafi’s 42 year reign, opined Najla El Mangoush, a graduate lecturer from George Mason University who is also an adjunct faculty member from Northern Virginia Community College.

Given this background, it is understandable that Libyans have learnt to mistrust its leaders. Once the euphoria of the revolution waned, there has been no capable institution to handle the transition nor an effective police force to help civilians manage law and order. As a result of open borders traficking and smuggling are rife in the country.

Given this scenario, militia groups have managed to carve a space for themselves since there is a weakness in the central government. Essentially they want an opportunity to play a role in Libya and they potentially be absorbed in a broader Libyan army, opined Al-Meshri.

Even if Libya had a central government, Tripoli would still face threats from persistent terrorist groups, such as Al Qaeda and ISIS especially in southern Libya; uncontrolled migration, human trafficking, and the widespread proliferation of weapons throughout the country.

With a population of around 7 million people, it is estimated that more than 23 million weapons are in circulation in Libya. Only by creating a strong unified Libyan army under the control of a single elected and internationally recognized central government can Libya address its security vacuum.

Security challenges that Libya faces goes much beyond its internal divisions. Given the lack of a single central government and eyeing the country’s riches, foreign powers have since long tried to interfere in Libya’s internal affairs.

Foreign influence

In an interview to The National Interest, Issa Tuewiger, Libya’s former Minister of Planning, “emphasized the need for foreign powers to curb their interference in Libya’s internal affairs.” Although he did not specifically point to any country, it is well known that the United Arab Emirates and Egypt have both been key international backers of General Haftar’s LNA; militias from Sudan and Chad are also well known for their cross-border disruptions in southern Libya.

While western nations, including the United States and Italy have voiced full support for the GNA, France’s pro-GNA stand has been colored by its deployment of special forces and military advisors to aid the LNA in Eastern Libya.

Russia, which has long been a supporter of the LNA, has recently embraced Gaddafi’s son, Saif al-Islam Gaddafi, as a potential political player in Libya.

If Libya wants to increase its influence and play a larger role in the international community, it will need to form partnerships with regional and international actors as opposed to being viewed as a “nation ripe for foreign powers to meddle with in pursuit of their own interests”, said Tuewiger.

The obvious economic potential

Although Libya has abundant and valuable natural resources, its economic institutions have been severely stunted under decades of Qadhafi’s rule. As a result the Libyan economy faces high unemployment and a lack of qualified personnel to fill available jobs.

Although petroleum reserves have been Libya’s lifeblood, they are “both a blessing and a curse,” opined Al-Meshri saying over reliance on oil revenues has resulted in the neglect of other segments of the economy. Even its oil economy suffers from under funding and unoptimised production.

While Libya’s crude oil touched nearly 800,000 barrels per day in 2017 which, an improvement from the previous year, its oil exports pales in comparison to those of its neighbours.

In order for Libya to heal from its many wounds, its necessary that Libyans should be provided a basic safety, security, and a sense of dignity. Government institutions should be created to provide justice thus reforming the judicial and the police force. Libyans should be made to feel a sense of responsibility for the country. Their hard work will potentially not only improve the economy but also nurture local leadership.

Such a strategy could be further enhanced if Libya were to make a request to the United Nations for the deployment of observers, who will protect specific assets, locations and institutions, monitor and enforce a ceasefire accord.

It is for Libyans to decide whether they have the courage to take bold steps to create a realistic opportunity for economic prosperity and peace.