Publication: Libya Economic Monitor, Spring 2025: Redefining the Role of State-Owned Enterprises in Libya
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2025-07-01
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2025-07-01
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In 2024, Libya’s economic performance reflects the persistent challenges of hydrocarbon dependency compared against nascent signs of broader recovery. The economy recorded a contraction of 0.6 percent for the year, driven primarily by a decline in oil GDP of 6 percent amid political and institutional disruptions that originated from the Central Bank of Libya (CBL) crisis in August. However, non-oil GDP growth of 7.5 percent, supported by robust private and public consumption, partially offset the decline. The weak overall performance highlights the critical reliance on the oil sector while underscores the limited capacity of non-oil sectors to fully mitigate hydrocarbon-related volatility absent deeper structural reforms. The Libyan economy is expected to rebound in 2025 primarily driven by the expansion of oil sector activities. The CBL’s official data offers an incomplete view of Libya’s fiscal health, hindering a full economic assessment. The data published by the CBL on a monthly basis includes Government of National Unity budgetary and extra-budgetary expenditures, including the National Oil Company and General Electricity Company, but underestimates oil revenues and fuel subsidies as a result of the oil-for-fuel swap mechanism implemented since November 2021. It also omits Government of National Stability public spending, complicating accurate fiscal position analysis. This incomplete financial picture challenges effective policymaking and risks further instability in Libya’s fragile economy. The Special Focus Section Redefining the Role of State-Owned Enterprises in Libya examines the State-Owned Enterprises (SOEs) landscape in Libya’s economy, delving into their impact on fiscal sustainability and private sector growth, while drawing comparisons with structural and aspirational peers. It relies on new analysis using the World Bank’s Business of the State (BOS) database and reveals a vast network of nearly 190 Libyan SOEs spanning strategic and competitive sectors, including oil and gas, finance, utilities, transport, manufacturing, and tourism. The analysis provides, for the first time, a clearer picture of the scale, sectoral footprint, and governance structure of SOEs in Libya, confirming the outsized presence of the state across the economy. The analysis surfaces critical fiscal risks, inefficiencies, lack of transparency and market distortions.
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“World Bank. 2025. Libya Economic Monitor, Spring 2025: Redefining the Role of State-Owned Enterprises in Libya. © World Bank. http://hdl.handle.net/10986/43405 License: CC BY-NC 3.0 IGO.”
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