In 2020, Libya’s real GDP is expected to fall by 60% due to several shocks. The country’s poor economy and health system were further harmed by a blockade of major oil fields from January to early October 2020, a drop in oil prices, and the rapid spread of COVID–19.
Libya and EU
The European Union’s trade connections with Libya have been marred by the country’s long-running crises, instability, and lack of political resolution. Along with Syria, Libya is the only member of the Southern Neighbourhood that does not have an Association Agreement with the EU (Algeria, Egypt, Israel, Jordan, Lebanon, Libya, Morocco, Palestine, Syria, and Tunisia).
There are no economic agreements between the EU and Libya. The EU and Libya began negotiating a trade framework agreement in 2008. However, due to the ongoing political turmoil, these talks were put on hold in February 2011. Despite the EU’s assistance in Libya’s political transition to a stable and wealthy country, and the possibility of resuming bilateral trade negotiations in the future, the current lack of a political settlement hinders any trade conversations at this time.
Libya is not a WTO member. The organization’s accession negotiations with Libya began in July 2004 with the formation of a Working Party. The negotiation process, on the other hand, has come to a halt.
Libya- Tunisia
In Libya’s capital, Tripoli, Prime Minister Abdul Hamid Dbeibah met with his Tunisian counterpart, Hichem Mechichi, on May 22, 2021, and inked an agreement on joint trade and tourism.
Dbeibah told a press conference after the meeting that the agreement also includes technical cooperation on land, sea, and air transportation, as well as the activation of joint commissions on land and marine transportation.
The pact intends to encourage trade and tourism between the two countries, according to Dbeibah, who also stated that Libya will “spare no effort to improve the development and living standards of the two countries peoples.”
Libya – USA
The bilateral relations between Libya and the United States of America are referred to as Libya–US relations. Relations are now friendly and constructive, with a special emphasis on security cooperation following the 2012 attack on the US liaison office or mission in Benghazi. Libyans also expressed “among the greatest approval” of US leadership in the Middle East and North Africa region, according to a Gallup poll conducted in March and April 2012.
By holding free and fair elections, safeguarding Libya’s territory, and managing public finances transparently and responsibly, the US is committed to providing targeted support to improve Libyan institutions, promote political reconciliation, and increase Libya’s capacity to govern effectively. Investing in Libya’s future will aid the country’s democratic transition, foster stability, and deepen the US-Libya alliance. In its attempts to enhance Libyan lives, the US collaborates with the national government, city councils, entrepreneurs, and a variety of civil society organizations, especially those representing women and underprivileged communities. The United States has donated more than $840 million in aid to Libya since 2011.
