Libya council faces a steep learning curve

22 October 2011

Ministers in Libya’s National Transitional Council now face the tough task of rebuilding the country from the ground up

Libya’s National Transitional Council (NTC) will declare the country “liberated” from the its leader of 42 years, Muammar Gaddafi, on Saturday 22 October, following his death two days earlier. However, despite an air of triumphalism of much reporting on the country, it is only then that the council’s work in reshaping Libya will begin.

In fact, it will probably be the better part of a year before a “new” Libya emerges. The council faces the huge task of holding elections, creating a new government, designing and holding a referendum on a new constitution, and repairing the damage wreaked by the country’s eight-month civil war.

“They are going to have to try and rebuild and state-build at the same time, which is a difficult task,” says Robin Lamb, a former British diplomat to a range of Middle Eastern countries including Libya, and current director general of the Libyan British Business Council.

The last job may be among the most difficult the National Transitional Council faces. Officials have been appointed to oversee the reconstruction of the country, but have little in the way of staff or resources, say diplomatic sources working with the council.


Following the declaration of independence, the NTC will move from Benghazi, the  council’s headquarters during the war, to Tripoli, the traditional seat of Libyan power. Key members of the council for the reconstruction effort will be Ali Al-Tarhuni, minister of oil and finance, Naji Barakat, minister of health, Ahmed Al-Jehani, minister for reconstruction and infrastructure, Suliman El-Sahli, minister of education, and Ahmed Hussein Al-Darrat, minister of internal affairs and local government. 

Meanwhile, Mohammed Layas, chairman of the Libyan Investment Authority under Gaddafi, has been retained in his post for the foreseeable future, ensuring continuity of contacts with the private sector, and will be working with a new chief executive, Rafik El-Nayed.

These ministers will effectively have to rebuild the state apparatus and infrastructure from the ground up with the knowledge that they could be removed from their posts at any time. Should a new national unity government be formed - something which the NTC has already tried, and failed to do - they may be shuffled out of their positions, and the council plans to hold national elections for a new council of representatives within 240 days of the declaration of liberation. This council will ultimately elect a new prime minister who in turn will select a new government.

“If you are a temporary authority and you know you are not going to be in charge for all that long you are going to have to make sure you are absolutely immune to any accusations of wrongdoing,” Lamb says.

Restoring utilities

Priorities for the NTC include the construction of new health and rehabilitation centres in the country along with the reconstruction of existing facilities; revamping power and water facilities and boosting oil exports. In areas hardest-hit by fighting there is also a clear need for the reconstruction of housing - the UN estimates that between 100,000 and 150,000 people have been displaced by the civil war. This includes Zawiya, Bani Walid, Sirte and Misurata diplomatic sources say, all areas in which international organisations are pushing the NTC to focus home-rebuilding efforts.

The council will also have to focus on restoring utilities to the country’s major urban centres. According to NGO workers and diplomats, Tripoli residents have had no running tap water since 15 October, a major issue given that around 90 per cent of the city’s 2 million people depend on the state for supply. The NTC attributes the outage to damage sustained to power supplies to the country’s giant water pipeline, the Great Manmade River. Similar issues have been reported in other cities.

The biggest problem for the council will be finding skilled workers and technocrats to plan repairs and new work, says one former diplomat with links to the NTC. Although many Gaddafi-era civil service staff have been retained, many have been displaced by the fighting and a great deal of the country’s planning was done by foreign contractors.

The World Bank announced in September that it had agreed to help the NTC plan and tender contracts for the work but contractors say, thus far, its role has been limited while little work has been forthcoming from the council.

“Until [20 October], the council was very much focused on winning the war,” Lamb says. “In the meantime we haven’t seen much business coming out of Libya.”

Sources with knowledge of trade delegations to Libya, which have thus far included visits from France, Germany and Austria, report that businessmen hoping to score contracts overnight have generally been sent home empty handed.

Looking like a Gulf state

With Gaddafi gone, this could all be about to change, and the NTC will certainly have plenty of money to spend - in early September, the UN Security Council announced that it was handing $6bn in assets held abroad by the Gaddafi regime, which had previously been frozen, over to the NTC. Nouri Berouin, who was appointed as chairman of the National Oil Corporation (NOC) in September, has set an oil production target for Libya of 250,000-300,000 barrels a day by the end of the year. With oil prices above $100 a barrel in Europe, this could equate to a monthly income of $1bn for the country, without accounting for generous loans and grants from abroad.

Executives from international engineering contractors and corporations say that Libya could prove a lucrative business opportunity in the future, if the security situation stabilises. However, says one Western engineer with experience in Libya, military security may not mean political stability.

Libya was a notoriously difficult place to do business in the past thanks to rampant corruption and a complex bureaucracy and council-led federal system, he says, which made it a “nightmare” to win contracts or get anything done. If political infighting breaks out during the coming year as the NTC tries to build state institutions and hold elections, this could make working in the country even harder and more uncertain.

Lamb agrees, but adds that the current situation presents a great opportunity for Libya to move ahead. “There is no reason why Libya shouldn’t look like a Gulf country right now,” he says.

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Key figures within the National Transitional Council:

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Business opportunities

  • Libya tenders: With the exception of the sole tender issued by the NTC, there have been few tenders issued within Libya this year.

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