The below article is a snippet from a larger Libya Q3 Forecast that you are able to download in pdf. format for free. Just fill out the form below and it will be sent to your inbox:
Domestic Politics and Policy
The Libyan peace process will continue to limp along in fits and starts, and the international powers are likely to press harder for a solution over the coming months. This will be done through the framework of the Paris Agreement, which seems to have eclipsed the so-called Action Plan put forth by UN Special Representative to Libya Ghassan Salamé.
Once the oil port crisis has been brought to heel, the opposing factions can be expected to resume negotiations under the Paris umbrella, with a major push to get the House of Representatives to pass an election law by September in order for elections to proceed in December 2018.
The House may well succeed in getting 120 MPs to vote in favour of the law, given its wish for elections to go ahead, but if the Higher State Council continues to be excluded it will try to stall the process. The Council will also continue to urge approval of the constitution before elections, and the House will resist.
It is therefore uncertain whether elections will be held this year, even if security conditions had sufficiently improved – which is also in doubt. The public discourse will espouse willingness to adhere to the peace process, but neither side is likely to make the compromises necessary for lasting peace.
Recent events have set back efforts to stage a recovery in the energy sector. Much of the energy infrastructure requires upgrades, repairs, and serious investment, and the latest damage will further burden the National Oil Corporation (NOC), which is already struggling for resources, especially for development.
Nonetheless, the crisis is likely to be resolved and output levels to increase again, although Mustafa Sanalla’s longer-term target of 1.6 million b/d is perhaps ambitious. The overall trend is positive and although the sector will continue to be beset by stoppages, it should see continued improvement and hopefully the gradual return of IOCs.
This article was taken from the Libya Q3 Forecast, which can be found in our Libya Focus and Libya Politics & Security publications. For more information on this topic, or to ask our consultants any questions you might have regarding business in Libya, then please contact us.