RRJ# 2 Oxford Business Group to chart Libya's privatization progress in new economic report

Oxford Business Group to chart Libya's privatization progress in new economic report

Reference:

BI-ME staff (2010, February 7) Oxford Business Group to chart Libya's privatization progress in new economic report. Business Intelligence Middle East Company
http://www.bi-me.com/main.php?id=44113&t=1&c=35&cg=4&mset=1011/2010, February 7 bime.com

Summary:

Libyan production of oil is going up, and the exports to Europe are increasing, according to Shokri Ghanem, Chairman of the National Oil Corporation (NOC).That will improve the gas segment following the new energy policy which the most of European countries were followed to explore the gas in the Gulf of Sirt area.

He said that the new policy is going toward privatizing the refineries and the petrochemicals of the oil industry as part of its wider steps to reshape the sector. He added “We began by privatizing the Zwara fertilizer plant and the Raf Lanuf refinery.”

This sector is the most important for the industry segment and the foreign investment. Ghanem said that the he believed that the privatization for the gas segment will work successfully more than the public sector; in addition that will help the local companies to follow the big economic changes in the world. He said when he was meeting Oxford Business Group (OBG) “ere will be a marked increase in the development of local content within the industry and we are doing our best to encourage this trend.”

Reaction:

Libya used to follow the communist regime for a long time which required establish a different policy which meant the government is the director. Also, it has the most recourse of the inputs and the outputs. That implies that it is the unique responded which dominates the prices. That system filled down with URSS did , because it was as model for the old system. Furthermore this system is old; there are few countries still following the communist regime. Libya changed its mind to follow the capitalistic way. It found the communist regime areunsuccessful for its economy. The new system is different from the old.

The capitalists required changing all the sectors form public to private; the role of the government is just organization, and it can’t control the prices or it can’t control the inputs or the outputs. In addition, it can’t intrude in the market, because the market is working in the capitalism according to the power of demand and supply to approach to the equilibrium quantity and price. That means it is in the market equilibrium.

The new capitalism will affect these companies negatively in the first time, but that will change when these companies depend on themselves completely. They used to depend on the government’s funds .That means they will use the finance resources economically. They might give more ages for less employers. I think the good advice e for these companies is following the market changes in terms of the prices , employment, and supply. If they follow that rules (market rules) they will be more safety from the crisis.