Libyan political economy

Question

Give an update of key actors, dynamics and issues of Libyan political economy since the 2014 GSDRC report on the same topic.

Summary

Much has changed in Libya since April 2014. However, Libya remains highly unstable and divided along multiple fracture lines, with a multitude of armed and non-armed groups. Given the fluidity of relations between these groups, literature on the country situation becomes quickly outdated.

Libya has three rival claimants to power: a reconvened General National Congress (GNC) based in Tripoli and the House of Representatives (HoR) based in Tobruk were both established following contested elections in June 2014; and an executive Presidency Council established in Tripoli in early 2016, following the signing of the UN-backed Libya Political Agreement (LPA) which set-up a Government of National Accord (GNA).

Other key political actors include: Islamist political groups such as the Muslim Brotherhood, the National Oil Company and the Central Bank of Libya (CBL). The latter two have both tried to maintain a neutral position. Armed groups are mostly localised but vary in size: General Haftar’s forces, the Libyan National Army,  Ibrahim Jadhran’s Petroleum Facilities Guard and Misrata are among the most important. The influence of Zintan militias has waned since 2014. Islamist/jihadist armed groups include: Ansar al-Sharia, affiliated to al-Qaeda; the Benghazi Revolutionaries Shura Council and Daesh (also known as ISIL, Islamic State or ISIS).

Major dynamics and issues include:

  • Ongoing transition, militarisation of politics and conflict: While the GNA has international support, it is difficult to see how it will become the sole political authority in the country. A major reason for this is the involvement of armed groups in politics and the dependence of political parties on armed groups.
  • Economic crisis: Instability and ongoing conflict have resulted in a massive drop in oil production, while global oil prices have dropped reducing oil revenue. Spending on salaries is disproportionately high in Libya and growing budget deficits have forced the CBL to dip into foreign exchange reserves.
  • Crime, smuggling and migration: Libya’s economic crisis, the lack of state security, ongoing conflict and the presence of large numbers of armed groups, have led to an increase in crime, smuggling of goods, the arms trade and human trafficking since 2011. The dependence of communities, armed groups and state agencies on crime fuels corruption, and creates a systematic barrier to efforts for peace and reform.
  • Transnational influences from Libya’s neighbours, as well as the West, has added to the polarisation and undermined attempts at political dialogue and peace building. Extremist Islamic ideology and violence is a further transnational influence in the country.

This report is an update of the 2014 GSDRC Helpdesk Report: Key actors, dynamics and issues of Libyan Political Economy.

Enquirer:

Suggested citation

Idris, I. (2016). Libyan Political Economy (GSDRC Helpdesk Research Report 1385). Birmingham, UK: GSDRC, University of Birmingham.