Britain Seeks to Secure Deals in Libya Amid $126 Billion Rebuilding Opportunity

Strategic Insights -

As the rebuilding of Libya begins after the death of Muammar Gaddafi, British companies are eyeing a potential market worth billions. According to UK Trade & Investment (UKTI), the rebuilding of Libya is estimated to be worth £126 billion over the next decade. Infrastructure groups, such as AMEC and Arup, have already visited Libya, and Philip Hammond, the Defence Secretary, has urged British executives to head to Tripoli. However, business leaders are urging caution, warning that rushing into Libya without proper planning and preparation could hinder the country's progress.

Key Takeaways:

  • The rebuilding of Libya is estimated to be worth £126 billion over the next decade, according to UKTI.
  • A number of countries, including France and Italy, have already sent government-backed trade missions to Libya, but British companies may have to wait until a new government is formed to secure deals.
  • The National Transitional Council (NTC) has prioritized restoring order and helping the injured, making it unlikely that big deals will be negotiated until after an election, at least eight months away.
  • Rupert Soames, CEO of Aggreko, has confirmed that Libya remains chaotic, and companies should be prepared for a fluid and confusing situation.
  • The Libya British Business Council has urged companies to be cautious, stating that business issues can wait until after a new government is formed.
  • UKTI has sent officials to Libya to work with the NTC to identify companies that can help rebuild the country.
  • The prize for European companies will be access to Libya's oil and gas, with the country having the largest proven reserves of oil in Africa but being relatively unexplored.
  • BP signed a £900 million contract to explore for oil in 2007 but had to pull out due to the conflict; executives from BP and Shell have visited Libya and been in contact with the NTC but have not decided when to return.

Statistics:

  • £126 billion: estimated value of the rebuilding of Libya over the next decade (UKTI).
  • 8 months: minimum wait until after an election before big deals can be negotiated (National Transitional Council).
  • £900 million: value of the contract signed by BP to explore for oil in 2007.
  • 80 expatriate staff: number of BP staff who had to pull out of Libya due to the conflict.
  • Largest proven reserves of oil in Africa: held by Libya.

Sources:

  • David Robertson, Business Correspondent for The Telegraph
  • UK Trade & Investment (UKTI)
  • Philip Hammond, Defence Secretary
  • Rupert Soames, CEO of Aggreko
  • Robin Lamb, director-general of the Libya British Business Council
  • Tony Blair, former Prime Minister
  • BP
  • Shell
  • National Transitional Council (NTC)