The eruption of violent protests on February 17th, 2011 led to an eight-month civil war between the government and the western-backed National Transitional Council (NTC), concluding with the collapse of the 42-year regime of Muammar Gaddafi. As a result, Libyan GDP was more than halved in 2011 by most estimates, while oil production was negligible. Despite these turbulent events, the post-civil war NTC government held elections on July 7th, 2012, for a legislative General National Congress (GNC), an elected legislative body that, in turn, elects an executive government (President) and appoints a Prime Minister.
The GNC assumed power on August 8th, 2012, and elected a new President, which was followed by a peaceful power transfer. A new Prime Minister was also appointed by the GNC, and formed a cabinet in November, 2012. The GNC and the interim government are expected to lead Libya through the transitional period and draft a new constitution by 2013. Libya’s GDP is expected to rebound to almost that of pre-war levels by the end of 2012 due to the resumption of oil production. The country is currently faced with security problems due to a weak national army and police, as well as interactional fighting among various militias and tribes in the country. Tensions also exist between the Eastern and Western regions, and the southern areas of the country remains virtually lawless. On December 16th, 2011, most of Libya’s foreign assets held abroad were unfrozen. The government shifted some of the foreign funds held by the Libyan Investment Authority to domestic investment. The government passed the 2012 budget projecting expenditures of LYD54.8 billion (USD43.42 billion), the biggest in the country’s history, mostly on capital investments and rebuilding infrastructure damaged by the war. Oil revenues continue to account for the majority of government revenues over the short term until investments are made in other sectors. By the end of 2012, oil output almost reached pre-war levels of 1.6 million barrels per day. The Central Bank is likely to play a role in increasing private sector growth by encouraging lending, cutting interest rates, and even reducing the legally required reserve (LRR) rate.
|Nominal GDP (USD bn)(2009)||98.2||Population (mn)||6.4|
|Real GDP (USD bn)(2009)||63.6||Population growth (%)||1.1|
|Real GDP Growth (%) (2009)||(26)||Inflation (%)(2009)||0.3|
|Sectors (%) (2008)||M2 (LYD) (2011)||56.0|
|Services||20.0||Exchange rate (USD/LYD) (2011)||1.3|
|Industry||78.0||Current account (USD bn) (2010)||14.6|
|Agriculture||2.0||Total Reserves (USD bn) (June 2012)||110.5|