São Paulo – The Gross Domestic Product (GDP) of Libya should continue growing in 2013, but at a lower rhythm than in 2012 and more than in 2011, when public protests resulted in the ousting and death of dictator Muammar Khadafi. However, according to a study of the country’s figures, disclosed on Thursday (23) by the International Monetary Fund (IMF), Libya needs to implement transparent policies in the use of funds and to fight financial crime.<\/p>\n
According to IMF estimates, the GDP of Libya should grow 20.2% this year, to reach US$ 94.6 billion. In 2012, the GDP grew 104.5% over 2011, mainly due to the return of oil production, to the inauguration of a new government and to the liberation of the country’s foreign assets after the opposition to the Khadafi regime took over the country. The IMF document also forecasts that this year inflation should total 2.1%. In 2012, it was 6.1% and, in 2011, 15.9%.<\/p>\n
The oil sector continues to be the main source of revenues of Libya. In 2012, the country exported the equivalent to US$ 62.2 billion, of which US$ 61 billion in oil and its products.<\/p>\n
IMF technicians visiting Libya in May state in the document that the country in North Africa is en-route to growth and economic stability, but that it may have problems in future. Observing that prolonged political and economic uncertainty and the great oil price fluctuation “add” challenges to the government transaction. To overcome them, the IMF has recommended that Libyan authorities put in practice a programme for economic reform.<\/p>\n
“Directors welcomed the authorities’ intention to articulate and implement a strategic vision for economic development, including setting up a governance framework based on transparency and accountability. They noted that credible and efficient institutions and a favourable business environment will be crucial to create employment opportunities in the private sector and reduce hydrocarbon dependency,” says the document, which also observes that the country needs to fight financial crime, like money laundering, and also the financing to terrorism.<\/p>\n
Early in the year, the Libyan government approved a law that bans interest on financial transactions, to go into place in 2015. This law follows Islamic finance rules, which ban interest. The IMF stated, however, that if the adoption of this law is not extended, financial institutions may find it hard to loan money. The IMF also warned that the economic policy currently employed is “skewed” towards giving subsidies and wage increases, affecting the country figures and reducing its capacity to supply priorities, like investment in infrastructure.<\/p>\n
*Translated by Mark Ament<\/strong><\/p>\n