Libya pushing for greater Gulf investment
The Libyan Ministry of Oil and Gas, Abdelbari al-Aarusi, announced that the cabinet is currently looking to implement a plan that aims to encourage Gulf countries to make investments during its upcoming phase.
The plan being studied is focused on Gulf companies that have investments in Libya. Al Arabiya reports that the plan includes exempting the companies from taxes for five years which can be extended for another three years; on condition a Libyan partner is present.
The plan also aims to encourage Gulf countries to investment in Libya, which is expected to witness developments as Gulf investors increasingly enter the Libyan market, following the ousting of the former Libyan dictatorship.
Reports indicate that the Libyan government has granted the investor 65% from the project’s value while the other 35% percent goes either to the Libyan investor or the government.
Libyan Oil and Gas Minister Abdelbari al-Aarusi was quoted by the Riyadh newspaper as saying that Libya was willing to negotiate with the Saudi kingdom to allow Saudi company Aramco to directly invest in Libya to explore and extract petroleum.
Aarusi’s statements came during the minister’s visit to Saudi Arabia where he met with some businessmen in the Eastern Province’s Chamber of Commerce and Industry.
The Libyan minister is also reported telling Saudi daily Al-Iktsadiya that the government has various large projects in petroleum, gas, petrochemicals, education and tourism, in addition to roads and residential buildings - which value is estimated in billions and which US and European companies stepped up for.
He added, however, that the Libyan government prefers Gulf companies, particularly Saudi Arabian ones, to be in charge of implementing these projects either in alliance with Libyan companies or the government.
Aarusi said that various large scale projects will be given Saudi companies in order to strengthen brotherly ties, remove previous disputes between the two countries, establish a new strategic partnership and benefit from the expertise of Saudi companies. He said that all obstacles facing Gulf investors will be overcome and it was safe to make investments in Libya, noting the influx of international companies to Libya.
He went on to say that petroleum companies working in Libya have resumed operations and restarted extraction after the process was halted due to the February 17, 2011 popular revolution. He added that all projects that have been currently suggested will be assigned to Gulf countries to implement while the others will be offered up to international organisations.
Aarusi also called on Libyan businessmen to visit the country and look into plans that require specialised companies, especially since there are global companies that have contracts with the Libyan government that are still in effect. They include infrastructure, hospitals, schools, roads and residential buildings’ projects.
During his visit to the Aramco Company, Aarusi said he discussed several issues related to oil and gas as well as means to benefit from Aramco’s services. He said he expects Libyan delegations to visit Aramco in the future in order to sign agreements.
Aarusi also said he met with officials at King Fahed University for Petroleum and Minerals and discussed ways to cooperate.
Al Arabiya reported that a Saudi company, which the Libyan minister preferred not to reveal, submitted a plan to the Libyan cabinet to build two factories for sugar and cement in order to export the factories’ products to Europe and not Gulf countries. He said the total value of both factories is more than 1.7 billion riyals. The plan is yet to be discussed soon.
The minister is reported saying that the same company has also submitted a request to establish a free zone and that the city of Misurata was chosen to be the location of both factories, and that he expected this Saudi company to be totally in charge of starting up the sugar and cement factories in mid-2013.
- All talk: Why a GCC union does not matter for Arab countries' economies
- Aiding 'Um al-Dunya' or themselves? The Gulf's war over Egypt's economy
- What Arab Spring? The Middle East is undergoing a quiet revolution that is truly transforming the region
- An Economic Remedy for Jordan?
- Is Hamas on the verge of bankruptcy?