By Sami Zaptia
An article carried by the Libyan Arabic language news paper OEA in December quoting the Libyan Investment Promotion Board (LIPB) reported that an increased number of investment projects, and specifically tourism projects were being executed in Libya.
The report explains how foreign investment in Libya in general had increased as a result of the investment promotion law No. (5) of 1997 (and subsequent important amendments) and the take-off of the Libyan Investment Promotion Board's activities in the year 2000.
The Board reported that it had successfully promoted a total of 82 investment projects across all sectors in Libya between 2003 and 2007, of which 34 projects were under execution in the first half of 2008.
However, beyond projects directly promoted by the Board, there are a total of 153 projects in the execution stage totaling Libyan Dinars 2.77 billion. Out of these projects there are 34 tourism projects totaling LD 242 million forecasted to create 10,000 new jobs.
These projects include the construction of new hotels, tourism complexes and villages, leisure parks, tourism administration centres, leisure boats, and the refurbishment of tourism houses, homes and chalets.
Moreover, the LIPB attributes this success to a number of measures. These include a series of procedures to improve its internal workings and internal investment application procedures. One of these was the adoption of the principle of a one-stop 'unified window'.
A 'Unified Window' concept was initiated by the GPC for Economy, Trade and Investment for the procedure of company formation. Equally, it is now being adapted by the same GPC for all foreign trade (import-export) procedures. This procedure is, despite room for improvement, credited with much progress.
Other initiatives that the LIPB reported it had implemented included the furnishing of maps for investors, the increased computerization of the LIPB and its internal procedures, improving the relationship between local banks and potential investors, improving better co-ordination between the LIPB and various other Libyan GPC's, departments and sectors, and the signing of many investment agreements with numerous other countries.
There is no doubt that the LIPB has had increased relative success in attracting foreign and local investment into new projects in Libya. However this must be kept in perspective as we have started from a very low starting point, and when compared to our neighbours and peers, we still have a long way to go.
Moreover, in this new economic climate of poor investment and a lack of liquidity, attracting foreign investment is going to get very competitive and more difficult if Libya does not remain an attractive investment location. I expect all the other nations of the world desperately trying to attract foreign investment to up their game and offer even more attractive incentives and advantages for potential investors.
I am talking about nations that do not have oil, and foreign investment is a matter of life and death - and not an added bonus. These are the nations we must compete with for further foreign investment.
It is good news that the LFIB seems to have conducted some kind of internal review of its operations and that it has identified obstacles and weaknesses. This spirit of self criticism and correction in itself is heartening. There have been criticisms of the board's lack of transparent and bureaucratic procedures.
If only more GPC's were to look more self critically at themselves and initiate improvement actions. A good example was the seminar conducted by the Tax Authority which held a seminar last year (reported in depth by the Tripoli Post) where it admitted to many problems regarding Libya's taxation policies and procedures.
Identifying, accepting and admitting to short-comings in procedures and policies is the first step to finding solutions to any department's problems. I like the idea that the LFIB identified some internal problems such as the lack of computerization. It is a good sign and sends the right positive signal.
Computerization is not an option. In modern day administration and government it is a minimal requirement and starting point. It helps reduce paper work, bureaucracy, forgery and corruption. It helps impose and ensure central control, implementation and monitoring of policy - all issues that we have problems with in Libya.
I also like the fact that the LIPB accepted the fact that it had problems coordinating with other departments. Investors and potential investors have complained that their potential projects are stalled not by the LIPB but by procedures in other GPCs, departments or sectors.
Again this is a point that I have written about previously. Improvements in any department or sector small as they may be are welcome. The drip, drip effect will hopefully lead to a deluge. However, as I have said, islands of development and improvement across all Libya need to, eventually and preferably quickly, be inter-linked.
Only when there is all round improvement across all sectors and all departments and when decisions, laws and policies are dove- tailing will Libya really take-off and achieve enough momentum to carry our development and reform beyond the point of no-return. We need to achieve critical mass.
It is no use the GPC for Economy, Trade and Investment for example, becoming efficient yet the Customs and Tax Authorities, the GPCs for Industry and Mining or The Industrial Zones Authority or the banking sector are not. For all round improvements in the investment area in Libya, improvement and development is needed across all overlapping departments and sectors.
On a positive note, however, regarding the future outlook and policy on investment in the tourism sector, the LIPB pointed out in this report that it had identified 152 sites for potential tourism investment all along the Libyan coastline totaling about 32,780 hectares. This is good news for the future of Libya's tourism industry which is desperately needed to help diversify our economy away from the oil industry.