Libya, an Opec member, is earning billions of dollars through the sale of oil. It has recently increased production to about 1.4 million barrels a day and has reset targets to expand output further in the coming years.
However, its economy is beset with problems including the lack of a unified government to make policy decisions to spur growth, as well as high-level corruption and unregulated spending outside official channels that is not recorded by the Central Bank of Libya (CBL).
A volatile security situation and a lack of clear strategy to diversify its economy away from oil are also affecting its growth. Currently, oil and gas account for nearly 95 per cent of exports and government revenue, with no strategy in place to reduce dependence on hydrocarbons.
The government also spends heavily on subsidies and towards payment of salaries for public-sector employees. Lack of investment in launching new infrastructure projects is also hindering growth, analysts told The National.
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