News / Middle East

Buffeted by Chaos, Libya Faces Energy, Budget Crunches

FILE - In this Oct. 8, 2013 file photo, Libyan's Prime Minister Ali Zidan speaks to the media during a press conference in Rabat, Morocco.
FILE - In this Oct. 8, 2013 file photo, Libyan's Prime Minister Ali Zidan speaks to the media during a press conference in Rabat, Morocco.
Already buffeted by lawlessness and seemingly unending political turmoil Libya is now facing budgetary and energy crunches, say top officials.
 
Libya’s oil production plummeted just over a week ago after armed groups shutdown a major oilfield in the southwest of the country, piling on a further challenge for the country’s beleaguered government, which has been unable to engineer an end to a seven-month oil blockade by unruly militias.
 
The shutdown of the el-Sharara oilfield in the Murzuq desert is adding to government budget woes created by the blockade of key oil-exporting ports by federalist militias who want semi-autonomy for eastern Libya. Libya’s energy industry provides more than 90 percent of state revenues and accounts for 70 percent of the country’s GDP.
 
El-Sharara was only restored to full production in January, a restoration cited by Libya’s Prime Minister Ali Zeidan as one of his signature achievements. With revenue worries mounting, the head of the parliamentary budget committee, Mohammed Abdallah, is warning the country faces a budgetary crunch, posing “a very big danger” for Libya.
 
Libya’s oil output has now fallen to 230,000 barrels a day; far short of the 1.4 million bpd it reached before the oil blockades. El-Sharara has a 340,000 bpd capacity.
 
Libya has the largest oil reserves in Africa. Even so, Zeidan’s government, which managed to exploit political factions in January to prevent the interim parliament, the General National Congress, from passing a vote of no confidence in it, has already incurred a deficit of nearly four billion dinars ($3.2 billion) this year alone.
 
It has presented a six-month budget to the GNC, which would see a jump in public sector wages. Many of the untruly militias are on the government payroll – an attempt by Zeidan to placate them, say analysts.
 
With government revenue drying up, the government is also faced with a worsening domestic energy crunch—one likely to deepen public disaffection with the country’s fitful and violence-plagued transition from autocracy to democracy. The militias have added to energy-generating shortfalls by damaging and looting several of the country’s aged and poorly maintained power plants.

Neglected during the 42-year dictatorship of Col. Gadhafi, Libya’s energy infrastructure has labored to cope with consumer and business demand. Rolling blackouts are a regular feature during the high-usage months of the summer. Electricity ministers are generally mocked as ministers for blackouts.
 
In January Revenue Watch Institute, a New York-based think tank, warned in a study by its economic analyst, Andrew Bauer, that Libya despite its oil resources is heading for bankruptcy. “If current trends continue, the nation of 6.5 million may well go bankrupt by 2018,” Bauer maintained.
 
With problems mounting – from targeted assassinations to deteriorating security – ordinary Libyans are becoming increasingly frustrated. On February 20, Libyans voted to elect a Constituent Assembly tasked to draft a new constitution. The low-turnout and lack of public enthusiasm contrasted with the elections 18 months ago for the GNC, the first time Libyans had gone to polls in half-a-century. Only about a third of the eligible electorate bothered to register for the Constituent Assembly and only half of those who did register turned out to vote. 
 
“The low turnout figures send a clear message to the political elite in Tripoli that Libyans have lost trust in them—and, by implication, in the democratic process itself,” cautioned commentator Mohamed Eljarh in a blog post.
 
The assembly has been given four months to draft a constitution but few analysts think this deadline will be met, risking a further erosion in public trust in the democratic process. In February, the GNC stirred widespread criticism by extending its interim mandate, three years after the overthrow of Moammar Gadhafi, because it had failed to meet the timetable for drafting a constitution.
 
Dueling political factions linked with militias have threatened to force the GNC to step aside and the last few weeks Libya has been awash with rumors of coups. Militias from the town of Zintan, the most transition-loyal of major Libyans towns, demanded on February 18 that the GNC disband, prompting the interim parliament’s speaker to accuse them of threatening “a coup d’etat.”
 
Other factions and militias, mainly Islamist, have demanded that Zeidan resign. – something he says he will not do – for now.

You May Like

Bleak China Economic Outlook Rattles Markets

Several key European stock indexes were down up to three percent, while US market indexes were off around 2.5 percent in afternoon trading More

DRC Tries Mega-Farms to Feed Population

Park at Boukanga Lonzo currently has 5,000 hectares under cultivation, crops stretching as far as eye can see, and is start of ambitious large-scale agriculture plan More

Video War, Drought Threaten Iraq's Marshlands

Areas are spawning ground for Gulf fisheries, a resting place for migrating wildfowl, source of livelihood for fishermen and herders who have called the marshes home for generations More

This forum has been closed.
Comment Sorting
Comments
     
by: ali baba from: new york
March 02, 2014 8:43 PM
The Libya crisis proves that Gadhafi had controlled the country efficiency . the Us policy maker whom support the rebel to over thrown Gaddafi had made a terrible mistakes because they are not understand the behavior of Libyan people . Gaddafi had made serious achievement of the country . he developed Libya . He build Libya from scratch . in the last ten years ,he opposed terrorist such as Osama bin laden group .I do not understand why United State aided the rebel group to overthrown Gadhafi and killed him in a barbaric way. then the terrorist group attack American Embassy and killed the American ambassador. so we helped the wrong people and it is a lesson to Us policy maker that little knowledge is very dangerous.
In Response

by: Xaaji Dhagax from: Somalia
March 03, 2014 2:23 AM
Gaddafi was a dictatorial terrorist, supervised the bombing of Pan Am Flight 103 in 1988, killing hundreds of innocent passengers and also he slaughtered millions of his own people. Gaddafi invaded Egypt, Chad and helped fuel further the bloody tribal/clan war in Somalia and caused the war between Tanzania and Uganda. There's nothing good about Gaddafi which the world can record.

US continues to develop a very shortsighted plan when dealing with Arab countries. America wholeheartedly helped Libyan rebels overthrow Gaddafi in return the rebels gave America people a big "Thank You" by assassinating it's ambassador in Benghazi.
America should realize that the principal of "the enemy of my enemy is my friend" does not work in the Middle East.

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Nobel Prize Winner Malala Talks to VOAi
X
August 31, 2015 2:17 AM
Nobel Peace Prize winner Malala Yousafzai met with VOA's Deewa service in Washington Sunday to talk about women’s rights and unveil a trailer for her new documentary. VOA's Katherine Gypson has more.
Video

Video Nobel Prize Winner Malala Talks to VOA

Nobel Peace Prize winner Malala Yousafzai met with VOA's Deewa service in Washington Sunday to talk about women’s rights and unveil a trailer for her new documentary. VOA's Katherine Gypson has more.
Video

Video War, Drought Threaten Iraq's Marshlands

Iraq's southern wetlands are in crisis. These areas are the spawning ground for Gulf fisheries, a resting place for migrating wildfowl, and source of livelihood for fishermen and herders. Faith Lapidus has more.
Video

Video Colombians Flee Venezuela as Border Crisis Escalates

Hundreds of Colombians have fled Venezuela since last week, amid an escalating border crisis between the two countries. Last week, Venezuelan President Nicolas Maduro ordered the closure of a key border crossing after smugglers injured three Venezuelan soldiers and a civilian. The president also ordered the deportation of Colombians who are in Venezuela illegally. Zlatica Hoke reports.
Video

Video Rebuilding New Orleans' Music Scene

Ten years after Hurricane Katrina inundated New Orleans, threatening to wash away its vibrant musical heritage along with its neighborhoods, the beat goes on. As Bronwyn Benito and Faith Lapidus report, a Musicians' Village is preserving the city's unique sound.
Video

Video In Russia, Auto Industry in Tailspin

Industry insiders say country relies too heavily on imports as inflation cuts too many consumers out of the market. Daniel Schearf has more from Moscow.
Video

Video Scientist Calls Use of Fetal Tissue in Medical Research Essential

An anti-abortion group responsible for secret recordings of workers at a women's health care organization claims the workers shown are offering baby parts for sale, a charge the organization strongly denies. While the selling of fetal tissue is against the law in the United States, abortion and the use of donated fetal tissue for medical research are both legal. VOA’s Julie Taboh reports.
Video

Video Next to Iran, Climate at Forefront of Obama Agenda

President Barack Obama this week announced new initiatives aimed at making it easier for Americans to access renewable energy sources such as solar and wind. Obama is not slowing down when it comes to pushing through climate change measures, an issue he says is the greatest threat to the country’s national security. VOA correspondent Aru Pande has more from the White House.
Video

Video Arctic Draws International Competition for Oil

A new geopolitical “Great Game” is underway in earth’s northernmost region, the Arctic, where Russia has claimed a large area for resource development and President Barack Obama recently approved Shell Oil Company’s test-drilling project in an area under U.S. control. Greg Flakus reports.
Video

Video Philippine Maritime Police: Chinese Fishermen a Threat to Country’s Security

China and the Philippines both claim maritime rights in the South China Sea.  That includes the right to fish in those waters. Jason Strother reports on how the Philippines is catching Chinese nationals it says are illegal poachers. He has the story from Palawan province.
Video

Video China's Spratly Island Building Said to Light Up the Night 'Like A City'

Southeast Asian countries claim China has illegally seized territory in the Spratly islands. It is especially a concern for a Philippine mayor who says Beijing is occupying parts of his municipality. Jason Strother reports from the capital of Palawan province, Puerto Princesa.
Video

Video Ages-old Ice Reveals Secrets of Climate Change

Ice caps don't just exist at the world's poles. There are also tropical ice caps, and the largest sits atop the Peruvian Andes - but it is melting, quickly, and may be gone within the next 20 years. George Putic reports scientists are now rushing to take samples to get at the valuable information about climate change locked in the ice.

VOA Blogs