Estudios Económicos


Population 6.7 million
GDP 5,813 US$
Country risk assessment
Business Climate
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major macro economic indicators

  2020 2021 2022 2023 (f) 2024 (f)
GDP growth (%) -29.5 28.3 -9.6 12.5 7.0
Inflation (yearly average, %) 2.8 3.8 4.0 2.4 2.4
Budget balance (% GDP) -22.3 14.8 23.2 8.0 9.0
Current account balance (% GDP) -8.5 -5.4 32.9 21.0 21.0
Public debt (% GDP) n.d. n.d. n.d. n.d. n.d.

(e): Estimate (f): Forecast 


  • Gas and oil reserves (the largest in Africa)
  • Very low external debt and surplus accounts
  • Large foreign exchange reserves and sovereign wealth fund
  • Strategically positioned in the Mediterranean, close to Europe


  • Dependence on hydrocarbons: around 60% of GDP, 90% of budget revenues and 95% of export value (2023)
  • Hydrocarbon sector development hampered by political strife and insecurity
  • West-East division of the northern part of the country against a backdrop of power struggles with foreign powers
  • Far south vulnerable to the proliferation of trafficking (human, arms, drugs) and animosity between Tuaregs, Toubous and Arabs, exacerbated by porous borders with unstable neighbours.
  • Political and institutional duality, corruption, insecurity, poor public services
  • Road, water, sanitary, educational and electrical infrastructures
  • Selective access to foreign currency for importers, with a flourishing parallel foreign exchange market
  • International sanctions have frozen most (80%) of the sovereign wealth fund's assets since 2011

Risk assessment

A divided country

Following the 2011 revolution which brought to an end 41 years of President Gaddafi’s rule, the civil war that raged from 2014 to 2020 resulted in the division of the country between the East and the West. In the west, the Government of National Unity (GNU), led by Prime Minister Abdelhamid Dbeibeh, the High Council of State (Upper House), and the Presidential Council, are based in Tripoli and enjoy international recognition. The GNU has been mandated by the UN to lead Libya to the presidential and legislative elections originally scheduled for December 2021. The indefinite postponement of these elections resulted in the creation of the Government of National Stability (GNS), based in Sirte, in the east of the country. It is headed by Prime Minister Oussama Hammad and supported by the House of Representatives (Lower House), and is also recognised by the international community, based in Tobruk. Both the GNU and the GNS are supported by various militia (including foreign mercenaries) and former army units, notably the Libyan National Army (LNA) led by Marshal Haftar in the east. The two authorities also divide the international community: Russia and Egypt support the GNS, while Turkey supports the GNU. Regular attempts are made at institutional reunification, sometimes under the auspices of the UN Mission (UNSMIL) and the international community. The recent rapprochement between Turkey and Egypt could favor it.
The two-sided nature of Libyan government has prompted a number of consequences. The exploitation of hydrocarbons and the distribution of associated revenues are sensitive issues, especially as a vast majority of the wells are under the control of the government in the East. In this context, the blockade of several oil wells by armed groups aligned with the Libyan National Army (LNA) led to an agreement in 2023 between Dbeibeh and Marshal Haftar on revenue-sharing. The High Committee for Financial Oversight comprising representatives from the East and the West was created to allocate budgetary resources. The agreement, along with the reunification of the Central Bank of Libya (CBL) in August 2023, is an improvement in the security environment and is proof of the progress made in economic management, albeit precarious.


Growth fuelled by hydrocarbons

Economic growth rebounded in 2023,, supported by strong recovery in oil production (+0% compared with 2022), which reached an average of 1.2 million barrels per day (bpd). Three foreign oil companies (Eni, British Petroleum and Sonatrach) resumed operations in August 2023 after a ten-year shutdown due to force majeure. This trend is set to continue into 2024, in line with a gradual increase in hydrocarbon production. At the beginning of 2024, the National Oil Company (NOC) announced a production target of 2 million bpd in three to five years’ time and further out, 3.4 million bpd, the level of the 1970s, over the longer term, with an increase of 100,000 bpd already forecast for this year. Production growth will be supported by increased investment. The NOC, in partnership with foreign companies, plans to invest USD 18 billion in 45 oil and gas projects. It has also launched an international tender to ramp up exploration in the Sirte, Murzuk and Ghadames basins, as well as a national tender to encourage local companies to invest. In addition, Spain's Repsol is set to begin operations in the Murzuk basin in April 2024. Last, the NOC and Eni have signed an agreement to develop two offshore gas fields in 2023. Eni has announced plans to invest USD 8 billion over 3 years, making it the largest investment in the hydrocarbon sector since 2011 and would enable the production of around 760 million cubic feet of gas per day. Nevertheless, the increase in hydrocarbon production will remain hampered by political divisions and the obsolescence of extraction and transport facilities, keeping it well below its 2010 level (around 1.8 million bpd). The increase in hydrocarbon production should support exports, government revenues and automatically boost public spending and private consumption. However, due to security problems and the poor business environment, non-oil growth will remain weak. Inflation is unlikely to vary much owing to weaker volatility in world commodity prices.

Oil exports maintain surpluses, despite sustained public spending and imports

Libya is heavily dependent on hydrocarbon revenues for its budget (95%). Rising production and durably favorable oil prices will enable the country to maintain its budget surplus despite strong public spending. Although strictly speaking there is no national budget due to the political division, the Central Bank of Libya (CBL), which collects oil revenues and redistributes them to the two governments, exercises control over their spending, especially that of the Western Government (GNU), warning it against significant increases in public spending. Its budget spending is dominated by public-sector salaries, which employ around a third of the population. Household subsidies, which account for a large share of spending (25%), are set to decline by 2024. On that score, the Tripoli government has announced the abolition of fuel subsidies which encourage smuggling. The domestic price of petrol is $0.03 a litre, the second-lowest in the world after Venezuela. However, in view of the protests against this abolition, the GNU could adopt targeted subsidies to support the purchasing power of the poorest households. In addition, exceptional transfers to the NOC to boost oil production should be reduced compared with 2023. Last, the CBL’s Governor called for an end to obscurely-financed parallel spending and for the approval of a unified budget for the whole of Libya.
The current account surplus should remain stable in 2024, with, on the one hand, an increase in oil and gas exports, and on the other, a rise in imports linked to the numerous public and private investment projects, mainly in hydrocarbons. Libya’s oil industry depends on imports of both equipment and services. In addition, the import bill is set to rise due to the reappearance of the 27% tax on foreign currency purchases, proposed by the CBL in early 2024 and passed by the House of Representatives. This temporary tax (in force until the end of 2024), which has met with strongly opposition, is equivalent to reducing the official rate of the dinar from 0.1555 SDR ($0.21) to 0.11 SDR ($0.15). This should almost eliminate the gap with the parallel exchange rate ($0.14). The primary income balance surplus is still suffering from the freezing (since 2018) of dividends and interest on the assets of the Libya Investment Authority, the sovereign wealth fund. However, foreign exchange reserves remain very high (over 200% of GDP), representing more than four years of imports. The BCL ensures that they are maintained by controlling the granting of foreign currency to importers and personal transfers.


Last updated: April 2023

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