| TRIPOLI, April 10
TRIPOLI, April 10 Handing out plastic tea spoons
of golden honey, Milad Ahmed Ajaj hopes his local produce will
win over curious onlookers hovering around his stand at a
commercial fair in Tripoli.
The businessman, whose food company Alshifaa also produces
olive oil, showcased his goods at the Tripoli International Fair
this week along with other hopeful Libyan exporters who, after
years of cumbersome bureaucracy during Muammar Gaddafi's rule,
now see a chance to tap overseas markets.
"You can find Egyptian goods abroad, Tunisian olive oil is
everywhere so why not Libyan goods? We have a similar climate,
natural and good quality produce," Ajaj said at his stand,
surrounded by jars of clear honey and bottles of olive oil.
"We are like babies wanting to take our first steps. We want
to export our goods but Libya still has problems. We need
support, a first push to help us target international markets."
Boosting exports would reduce Libya's reliance on volatile
oil revenues and the drive to sell more overseas is being
spearheaded by the Libyan Export Promotion Centre (LEPC), a body
set up in 2006 that is supported by the economy ministry.
The North African country's first elections in a generation
last July were seen marking a new start for the economy after
Gaddafi's 42-year autocratic rule. The new government is still
transitional as the country prepares for a new constitution but
with unemployment estimated to be running at around 15 percent,
it is under pressure to diversify the economy and create jobs.
Gross domestic product more than doubled last year,
according to the International Monetary Fund, but growth was
driven almost entirely by the resumption of oil production to
levels of close to 1.6 million barrels per day (bpd) seen before
the uprising that toppled Gaddafi in October 2011.
"Libya produces good-quality dates, fish and olives, for
example, and there is no reason why it can't develop those into
a good little export niche, with the right government support
and business environment, especially given the country's
location," Alex Warren of London-based research and advisory
firm Frontier, said.
"But it is never going to make inroads on oil and what that
contributes to exports, and Libya will remain very dependent on
imports for the majority of its needs."
The OPEC member relies on petrodollars from hydrocarbon
exports for 95 percent of its income, with exports by state
energy firm, the National Oil Corporation, amounting to 34.9
million barrels, or $4.054 billion, in February, the latest
Analysts say Libya's new rulers need to develop the private
sector, seeing strong potential for fisheries as well as tourism
eventually, if the government can improve security in the
Economy Minister Mustafa Mohammed Abufunas has mentioned
plans to improve business laws to boost the private sector and
programmes to encourage job creation at small and medium-sized
enterprises, but has yet to present specific details.
"We also plan to help increase exports and we are looking at
dates, fish and olive oil. These steps (to boost the private
sector) will also create new jobs," local media quoted the
minister as saying.
A desert country, only around 2 percent of land in Libya is
arable. It was the world's 12th largest olive producer in 2010
and the 10th biggest producer of dates, according to the United
Nations' Food and Agricultural Organisation.
However, its estimated output of olives at 180,000 tonnes,
lagged far behind Spain, the world's top producer, on 6.7
million tonnes in 2010 or even neighbours Tunisia, Egypt and
Algeria which all produced more than double Libya's output.
"There is certainly untapped potential. Libya produces more
than you might think but it needs more expertise in branding,
packaging and selling on the international market," Warren said.
"You can buy a surprising number of Libyan-made products,
but very few of them make it out of the country yet."
The country also has iron ore deposits, in the central Wadi
al-Shatti area. Plans to develop them were interrupted by the
war, but are likely to be taken up again in future, Warren said.
Ajaj exported honey to Abu Dhabi before the war but he and
other companies say the government needs to help them if they
are to export in big volumes.
"Promises (by the authorities to boost non-oil exports) were
made but nothing was done; it was all through our own efforts,"
a spice vendor from Benghazi said at the fair. "We are still in
a transitional period. I am looking to come to Tripoli (to sell
products), then I would like to go wherever possible."
The LEPC aims to offer support programmes to help companies
market their goods overseas but, like other organisations
affected by the war, it is being overhauled.
"We only just started, studies need to be carried out, we
need a proper members' database," marketing manager Ahmed Biri
said. "Many companies suffered heavy (physical) damage, slowly
they have been rebuilding themselves. We want to discover new
While Libyan firms seek markets abroad, foreign companies
are seeking a way into the country. Before the war there was
little foreign investment, other than oil and some real estate
and banking, but investors now see potential given the need to
Trade delegations from around the world have visited in the
last year and trade fairs for the oil and construction
industries have been held in Tripoli.
Major public projects are on hold as the interim authorities
review pre-war plans but small private projects are taking off.
At the Tripoli International Fair, which was also held
during Gaddafi's time, French, Turkish, Moroccan and Kuwaiti
companies were among those exhibiting.
"We thought: why not come here? We didn't know the market.
We've made very good contacts," said Christine Herzo, in charge
of international development for French jeweller Herzo, which
exhibited rings and necklaces adorned with sparking gems.
"It is still too early but you can see the potential."
Libya's economy is poised to grow 17 percent this year and
should average growth of 7 percent annually between 2014 and
2017, assuming the domestic security situation improves, the IMF
has predicted. The country is aiming to increase oil production,
eyeing output of 1.7 million bpd by mid-2013 and 2 million bpd
Security, however, remains a concern as the authorities
struggle to rein in militias who refuse to lay down weapons. A
member of the French delegation at the Tripoli fair said 22
companies exhibited this year, compared with 50 last year.
"I want to go to refineries and plants to meet officials but
I will not leave Tripoli," a Moroccan businessman who works in
the maintenance of industrial plants, said. "I have been told it
is not safe."
Another concern is what the future legal framework for
foreign firms operating in Libya will be. "The country is still
in transition so nothing is clear," he said. "But there is a
huge need here, that's why it's worth it."
(Additional reporting by Ali Shuaib; Editing by Susan Fenton)