Capitalising on the business opportunities emerging in Libya was the subject of yesterday’s Malta Business Weekly/Le Meridian Phoenicia Business Breakfast, addressed by the Secretary General of the Libyan People’s Bureau, Saad Elshlmani, and former finance and foreign affairs minister John Dalli.

Opportunities are currently abounding in Libya, with major infrastructural, housing and tourism projects underway, while banking and business ownership regulations for foreigners are being relaxed with an aim to increase foreign direct investment.

Customs duties have been dramatically reduced and the liberalisation of the economy is also well underway.

Last week’s visit to Libya by British Prime Minister Tony Blair, coupled by a major oil exploration deal signed by British Petroleum, signalled, according to Mr Dalli, that “UK and US sanctions against Libya are now history” and that “Libya is one of the few promising markets in the region”.

Mr Dalli, who is active in consulting international and Maltese companies in political and economic developments in Libya, said that despite the rush of large foreign companies to Libya’s quickly emerging market, there was a void left behind which Maltese companies could fill.

“A new Libya is emerging, a Libya that is cosmopolitan and friendly,” Mr Dalli adds. “There is a new vision for Libya in the 21st century and this, my friends, will happen.”

Free trade zones are flourishing, gleaming hotels are rising up from the sands and education is being given an unprecedented boost. Libya, supported by the United Nations development programme, will be the first country where each schoolchild will have a laptop and internet access.

Mr Dalli added, “Malta had served as a gateway between Libya and the outside world during the days of international sanctions. Now that the sanctions have been lifted, it is a pity that, with the country on the verge of an economic explosion, that Malta no longer has the same relationship it once had with Libya.

“It seems that we are now experiencing a detachment as though EU membership has alienated us from what is destined to become the ‘Dubai of the Mediterranean’.”

Construction and tourism are two areas that should be of particular interest to the Maltese entrepreneur.

The country’s rapidly rising urban population will require some 450,000 new housing units over the next 10 years, while new ports, airports and roads also need to be constructed.

Moreover, Libya requires foreign skills and investment in the areas of cement and steel production to satisfy the country’s appetite for construction.

“Libya will clearly be a construction hotspot for years,” Mr Dalli says.

Additionally, Libya will require desalination plants and sanitation projects, most of which will be of a medium size and suitable for Maltese firms.

With its 1,700 kilometre pristine coastline, archaeological sites boasting the best-preserved Roman ruins outside Italy, and its desert attractions, the Libyan tourism industry is pegged to boom in the near future.

The country, which had 130,000 tourists in 2006, expects to raise the figure to one million by 2015 and USD6 billion have already been spent by the government and private sector. The Corinthia’s 140,000 square metre Palm City project is currently underway, as are several other tourism projects.

While the massive projects are out of Malta’s reach, Mr Dalli argued that the answer for Malta’s businesses is to cluster themselves into larger companies so as to rise to the challenges and grasp the considerable opportunities presented.

The oil sector, of course, was also developing. At present only 25 per cent of country has been explored for oil and natural gas, while it is estimated that some USD30 billion in FDI will be needed to survey the country’s vast assets. Oil production is expected to increase in the near future, with production currently levelling at half that of the 1970s peak.

But not all is rosy, Mr Dalli emphasised, and certain setbacks to doing business with Libya still persist. These include the country’s current lack of infrastructure, the lingering visa issue, customs, telecommunications, the bidding system and red tape.

But, Mr Dalli pointed out, such problems were often overcome once on the ground in Libya, and not remotely from Malta.

“Business with Libya means business in Libya and face-to-face contact is essential,” he says.

Also speaking yesterday, Dr Elshlmani observed how over the last few years Libya has made major strides by placing itself as a model for peace and stability in the region. This, he added, has translated into large amounts of FDI flooding into the country with several large European and US companies trying to take part in Libya’s economic rebirth.

Citing the numerous historical, cultural, economic and indeed linguistic ties between Libya and Malta, Dr Elshlmani pointed out that Malta’s first embassy was actually established in Tripoli in 1965 – and that the lasting friendship holds great mutual potential.

“We believe Malta is a bridge between Africa and Europe and between the Arab and European worlds thanks to Malta’s strong position in the Mediterranean,” he said. “As such, Malta has an important role to play and can serve as an interpreter, a broker and a facilitator.”

A number of joint ventures, such as Medelec, Medavia and the Corinthia Group, which he described as a model for future success, the Libyan-Maltese Holding Company as well as other ventures in fishing, trade and investment have realised this potential.

Since 1969 Libya and Malta have entered into some 40 bilateral agreements in areas such as economic cooperation, double taxation, encouraging and protecting investments, infrastructure, fisheries, and the fight against terrorism, organised crime and drugs.

With the liberalisation of the Libyan market well underway, there are plenty of opportunities in what is still essentially a virgin market, Dr Elshlmani pointed out, adding that with Libya developing its tourism sector, there are promising opportunities for Maltese experts to exchange their tourism expertise with Libya.

“Libya welcomes every serious investment, particularly those that translate into the transfer of technology and skills for the Libyan people,” he added.