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Economy of Libya

The government dominates Libya's socialist-oriented economy through control of the country's oil resources, which account for approximately 95% of export earnings, 75% of government receipts, and 25% of gross domestic product. Oil production, previously constant at just below Libya’s Organization of Petroleum Exporting Countries (OPEC) quota of 1.4 million barrels per day (bpd), ground to a halt following the outbreak of political violence in February 2011. Oil revenues constitute the principal source of foreign exchange. Much of the country's income over the years has been lost to waste, corruption, conventional armaments purchases, and attempts to develop weapons of mass destruction, as well as to large donations made to developing countries in attempts to increase Qadhafi's influence in Africa and elsewhere. Although oil revenues and a small population have given Libya one of the highest per capita GDPs in Africa, the government's mismanagement of the economy has led to high inflation and increased import prices. These factors resulted in a decline in the standard of living from the late 1990s through 2003, especially for lower and middle income strata of the Libyan society. On September 20, 2004, President George W. Bush signed an Executive Order ending economic sanctions imposed under the authority of the International Emergency Economic Powers Act (IEEPA). Under the 2004 order, U.S. persons were no longer prohibited from working in Libya, and many American companies in diverse sectors actively sought investment opportunities in Libya. In 2008, the government announced ambitious plans to increase foreign investment in the oil and gas sectors to significantly boost production capacity from 1.2 million bpd to 3 million bpd by 2012, a target that the National Oil Corporation later estimated would to slip to 2017. In February 2011, the U.S. and UN imposed sanctions on Libya following the outbreak of political violence. The government had been pursuing a number of large-scale infrastructure development projects such as highways, railways, air and seaports, telecommunications, water works, public housing, medical centers, shopping centers, and hotels. Despite efforts to diversify the economy and encourage private sector participation, extensive controls of prices, credit, trade, and foreign exchange have constrained growth. Import restrictions and inefficient resource allocations have caused periodic shortages of basic goods and foodstuffs, shortages that are worsening as the political unrest continues. Libya faces a long road ahead in liberalizing the socialist-oriented economy and recovering from the losses of the ongoing conflict, but initial steps, including applying for World Trade Organization (WTO) membership, reducing some subsidies, and announcing plans for privatization, have laid the groundwork for a transition to a more market-based economy. The non-oil manufacturing and construction sectors, which account for more than 20% of GDP, have expanded from processing mostly agricultural products to include the production of petrochemicals, iron, steel, and aluminum. Climatic conditions and poor soils severely limit agricultural output, and Libya imports about 75% of its food. Libya's primary agricultural water source remains the Great Manmade River Project, but significant resources have been invested in desalinization research to meet growing water demands. Government officials have also indicated interest in developing markets for alternative sources of energy, pharmaceuticals, health care services, and oil production byproducts. Real GDP (2009 est.): $85.04 billion. GDP per capita (PPP, 2009 est.): $13,400. Real GDP growth rate (2009 est.): -0.7%. Natural resources: Petroleum, natural gas, gypsum. Agriculture: Products --wheat, barley, olives, dates, citrus, vegetables, peanuts, soybeans; cattle; approximately 75% of Libya's food is imported. Industry: Types --petroleum, food processing, textiles, handicrafts, cement. Trade: Exports (2009 est.)--$34.24 billion: crude oil, refined petroleum products, natural gas, chemicals. Major markets (2009 est.)--Italy (37.65%), Germany (10.11%), Spain (7.94%), France (8.44%), Switzerland (5.93%), U.S. (5.27%). Imports (2009 est . )--$22.11 billion: machinery, transport equipment, food, manufactured goods, consumer products, semi-finished goods. Major suppliers (2009)--Italy (18.9%), China (10.54%), Turkey (9.92%), Germany (9.78%), Tunisia (5.25%), South Korea (4.02%).

Geography of Libya

Cities: Capital--Tripoli (pop. 1.5 mil-lion). Other--Benghazi (800,000). Terrain: Desert and semidesert; hills south of Tripoli and east of Benghazi. Climate: Mediterranean on coast; arid. Location: Northern Africa, bordering the Mediterranean Sea, between Egypt and Tunisia Map references: Africa Area: total area: 1,759,540 sq km land area: 1,759,540 sq km comparative area: slightly larger than Alaska Land boundaries: total 4,383 km, Algeria 982 km, Chad 1,055 km, Egypt 1,150 km, Niger 354 km, Sudan 383 km, Tunisia 459 km Coastline: 1,770 km Maritime claims: territorial sea: 12 nm Gulf of Sidra closing line: 32 degrees 30 minutes north International disputes: the International Court of Justice (ICJ) ruled in February 1994 that the 100,000 sq km Aozou Strip between Chad and Libya belongs to Chad, and that Libya must withdraw from it by 31 May 1994; Libya has withdrawn some its forces in response to the ICJ ruling, but still maintains an airfield in the disputed area; maritime boundary dispute with Tunisia; claims part of northern Niger and part of southeastern Algeria Natural resources: petroleum, natural gas, gypsum Land use: arable land: 2% permanent crops: 0% meadows and pastures: 8% forest and woodland: 0% other: 90% Irrigated land: 2,420 sq km (1989 est.) Environment: current issues: desertification; very limited natural fresh water resources; the Great Manmade River Project, the largest water development scheme in the world, is being built to bring water from large aquifers under the Sahara to coastal cities natural hazards: hot, dry, dust-laden ghibli is a southern wind lasting one to four days in spring and fall; duststorms, sandstorms international agreements: party to - Marine Dumping, Nuclear Test Ban, Ozone Layer Protection; signed, but not ratified - Biodiversity, Climate Change, Desertification, Law of the Sea

Government of Libya

Libya's political system is in theory based on the political philosophy in Qadhafi's Green Book, which combines socialist and Islamic theories and rejects parliamentary democracy and political parties. In reality, Qadhafi exercises near-total control over major government decisions. During the first 7 years following the revolution, the Revolutionary Command Council, which included Colonel Qadhafi and 12 fellow army officers, began a complete overhaul of Libya's political system, society, and economy. In 1973, Qadhafi announced the start of a "cultural revolution" in schools, businesses, industries, and public institutions to oversee administration of those organizations in the public interest. On March 2, 1977, Qadhafi convened a General People's Congress (GPC) to proclaim the establishment of "people's power," change the country's name to the Socialist People's Libyan Arab Jamahiriya, and to vest, theoretically, primary authority in the GPC. The GPC is the legislative forum that interacts with the General People's Committee, whose members are secretaries of Libyan ministries. It serves as the intermediary between the masses and the leadership and is composed of the secretariats of some 600 local "basic popular congresses." The GPC secretariat and the cabinet secretaries are appointed by the GPC secretary general and confirmed by the annual GPC congress. These cabinet secretaries are responsible for the routine operation of their ministries, but Qadhafi exercises real authority directly or through manipulation of the peoples and revolutionary committees. Qadhafi remained the de facto head of state and secretary general of the GPC until 1980, when he gave up his office. Although he holds no formal office, Qadhafi exercises power with the assistance of a small group of trusted advisers, who include relatives from his home base in the Sirte region, which lies between the traditional commercial and political power centers in Benghazi and Tripoli. In the 1980s, competition grew between the official Libyan Government, military hierarchies, and the revolutionary committees. An abortive coup attempt in May 1984, apparently mounted by Libyan exiles with internal support, led to a short-lived reign of terror in which thousands were imprisoned and interrogated. An unknown number were executed. Qadhafi used the revolutionary committees to search out alleged internal opponents following the coup attempt, thereby accelerating the rise of more radical elements inside the Libyan power hierarchy. In 1988, faced with rising public dissatisfaction with shortages in consumer goods and setbacks in Libya's war with Chad, Qadhafi began to curb the power of the revolutionary committees and to institute some domestic reforms. The regime released many political prisoners and eased restrictions on foreign travel by Libyans. Private businesses were again permitted to operate. In the late 1980s, Qadhafi began to pursue an anti-Islamic fundamentalist policy domestically, viewing fundamentalism as a potential rallying point for opponents of the regime. Qadhafi's security forces launched a pre-emptive strike at alleged coup plotters in the military and among the Warfallah tribe in October 1993. Widespread arrests and government reshufflings followed, accompanied by public "confessions" from regime opponents and allegations of torture and executions. The military, once Qadhafi's strongest supporters, became a potential threat in the 1990s. In 1993, following a failed coup attempt that implicated senior military officers, Qadhafi began to purge the military periodically, eliminating potential rivals and inserting his own loyal followers in their place. Qadhafi's strategy of frequent re-balancing of roles and responsibilities of his lieutenants makes it difficult for outsiders to understand Libyan politics. Several key political figures hold overlapping portfolios, and switch roles in a country where personalities and relationships often play more important roles than official titles. While high-ranking officials may have official portfolios, it is not uncommon for supposed subordinates to report directly to Qadhafi on issues thought to be within the purview of other officials. Foreign Minister Abdulati al-Obeidi was appointed to his position in March 2011, following the defection of his predecessor, Musa Kusa. Prime Minister al-Baghdadi al-Mahmoudi oversees the day-to-day operation of the Libyan cabinet, and plays a key role in setting financial and regulatory affairs, as well as domestic policies. Qadhafi’s sons play an important role in government circles. Qadhafi’s second son, Saif al-Islam al-Qadhafi, was previously viewed as a reformer but has emerged as a strong defender of the regime following the outbreak of political violence. His Qadhafi International Charity and Development Foundation (QDF) had served as a platform to advocate for greater respect for human rights, civil society development, and political and economic reforms. The QDF also played a key role in brokering dialogue with former Libyan Islamic Fighting Group members (LIFG), which led to their subsequent release from prison, and recantation of violence as a tool of jihad. Qadhafi’s younger sons, Khamis and Saadi, are commanding military units, while his fourth son, Mutassim, had served as National Security Adviser and continues to be involved in security and military relations. The Libyan court system consists of three levels: the courts of first instance; the courts of appeals; and the Supreme Court, which is the final appellate level. The GPC appoints justices to the Supreme Court. Special "revolutionary courts" and military courts operate outside the court system to try political offenses and crimes against the state. "People's courts," another example of extrajudicial authority, were abolished in January 2005. Libya's justice system is nominally based on Shari'a law. The Libyan Transitional National Council has set up a rival government in Benghazi. The 45-member Council includes representatives from throughout Libya and is headed by Chairman (and former Qadhafi Minister of Justice) Mustafa Abdul Jalil. The Council acts as the opposition’s legislative branch and has appointed an executive committee, headed by Mahmoud Jibril, to oversee interim governance issues. The TNC has stated repeatedly its desire to serve only as an interim body and has issued plans to draft a constitution and hold nationwide elections as soon as Qadhafi is removed from power. Principal Government Officials De facto Head of State--Mu'ammar Abu Minyar al-Qadhafi ("the Brother Leader and Guide of the Revolution") Secretary General of the General People's Committee (Prime Minister)--Al-Baghdadi Ali al-Mahmudi Secretary of the General People's Committee for Foreign Liaison and International Cooperation (Foreign Minister)--Abdulati al-Obeidi The Libyan Liaison Office is located at 2600 Virginia Avenue NW, Suite 705, Washington DC 20037 (tel. 202-944-9601, fax 202-944-9060). Official name: Great Socialist People's Libyan Arab Jamahiriya. Type: "Jamahiriya" is a term Col. Mu'ammar al-Qadhafi coined and which he defines as a "state of the masses" governed by the populace through local councils. In practice, Libya is an authoritarian state. Independence: Libya declared independence on December 24, 1951. Revolution Day: September 1, 1969. Constitution: No formal document. Revolutionary edicts establishing a government structure were issued December 11, 1969 and amended March 2, 1977 to establish popular congresses and people's committees that constitute the Jamahiriya system. Administrative divisions: 32 municipalities (singular--"shabiya", plural--"shabiyat"): Butnan, Darnah, Gubba, al-Jebal al-Akhdar, Marj, al-Jebal al-Hezam, Benghazi, Ajdabiya, Wahat, Kufra, Surt, Al Jufrah, Misurata, Murgub, Bani-Walid, Tarhuna and Msallata, Tripoli, Jfara, Zawiya, Sabratha and Surman, An Nuqat al-Khams, Gharyan, Mezda, Nalut, Ghadames, Yefren, Wadi Alhaya, Ghat, Sabha, Wadi Shati, Murzuq, Tajura and an-Nuwaha al-Arba'a. Political system: Political parties are banned. According to the political theory of Col. Mu'ammar al-Qadhafi, multi-layered popular assemblies (people's congresses) with executive institutions (people's committees) are guided by political cadres (revolutionary committees). Suffrage: 18 years of age; universal and compulsory.

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History of Libya

For most of their history, the peoples of Libya have been subjected to varying degrees of foreign control. The Phoenicians, Carthaginians, Greeks, Romans, Vandals, and Byzantines ruled all or parts of Libya. Although the Greeks and Romans left impressive ruins at Cyrene, Leptis Magna, and Sabratha, little else remains today to testify to the presence of these ancient cultures. The Arabs conquered Libya in the seventh century A.D. In the following centuries, most of the indigenous peoples adopted Islam and the Arabic language and culture. The Ottoman Turks conquered the country in the mid-16th century. Libya remained part of their empire--although at times virtually autonomous--until Italy invaded in 1911 and, in the face of years of resistance, made Libya a colony. In 1934, Italy adopted the name "Libya" (used by the Greeks for all of North Africa, except Egypt) as the official name of the colony, which consisted of the Provinces of Cyrenaica, Tripolitania, and Fezzan. King Idris I, Emir of Cyrenaica, led Libyan resistance to Italian occupation between the two World Wars. From 1943 to 1951, Tripolitania and Cyrenaica were under British administration, while the French controlled Fezzan. In 1944, Idris returned from exile in Cairo but declined to resume permanent residence in Cyrenaica until the removal in 1947 of some aspects of foreign control. Under the terms of the 1947 peace treaty with the Allies, Italy relinquished all claims to Libya. On November 21, 1949, the UN General Assembly passed a resolution stating that Libya should become independent before January 1, 1952. King Idris I represented Libya in the subsequent UN negotiations. When Libya declared its independence on December 24, 1951, it was the first country to achieve independence through the United Nations and one of the first former European possessions in Africa to gain independence. Libya was proclaimed a constitutional and a hereditary monarchy under King Idris. The discovery of significant oil reserves in 1959 and the subsequent income from petroleum sales enabled what had been one of the world's poorest countries to become extremely wealthy, as measured by per capita GDP. Although oil drastically improved Libya's finances, popular resentment grew as wealth was increasingly concentrated in the hands of the elite. This discontent continued to mount with the rise throughout the Arab world of Nasserism and the idea of Arab unity. On September 1, 1969, a small group of military officers led by then 28-year-old army officer Mu'ammar Abu Minyar al-Qadhafi staged a coup d'etat against King Idris, who was exiled to Egypt. The new regime, headed by the Revolutionary Command Council (RCC), abolished the monarchy and proclaimed the new Libyan Arab Republic. Qadhafi emerged as leader of the RCC and eventually as de facto chief of state, a political role he still plays. The Libyan Government asserts that Qadhafi currently holds no official position, although he is referred to in government statements and the official press as the "Brother Leader and Guide of the Revolution." The new RCC's motto became "freedom, socialism, and unity." It pledged itself to remedy "backwardness", take an active role in the Palestinian Arab cause, promote Arab unity, and encourage domestic policies based on social justice, nonexploitation, and an equitable distribution of wealth. An early objective of the new government was withdrawal of all foreign military installations from Libya. Following negotiations, British military installations at Tobruk and nearby El Adem were closed in March 1970, and U.S. facilities at Wheelus Air Force Base near Tripoli were closed in June 1970. That July, the Libyan Government ordered the expulsion of several thousand Italian residents. By 1971, libraries and cultural centers operated by foreign governments were ordered closed. In the 1970s, Libya claimed leadership of Arab and African revolutionary forces and sought active roles in international organizations. Late in the 1970s, Libyan embassies were redesignated as "people's bureaus," as Qadhafi sought to portray Libyan foreign policy as an expression of the popular will. The people's bureaus, aided by Libyan religious, political, educational, and business institutions overseas, exported Qadhafi's revolutionary philosophy abroad. Qadhafi's confrontational foreign policies and use of terrorism, as well as Libya's growing friendship with the U.S.S.R., led to increased tensions with the West in the 1980s. Following a terrorist bombing at a discotheque in West Berlin frequented by American military personnel, in 1986 the U.S. retaliated militarily against targets in Libya, and imposed broad unilateral economic sanctions. After Libya was implicated in the 1988 bombing of Pan Am flight 103 over Lockerbie, Scotland, UN sanctions were imposed in 1992. UN Security Council resolutions (UNSCRs) passed in 1992 and 1993 obliged Libya to fulfill requirements related to the Pan Am 103 bombing before sanctions could be lifted. Qadhafi initially refused to comply with these requirements, leading to Libya's political and economic isolation for most of the 1990s. In 1999, Libya fulfilled one of the UNSCR requirements by surrendering two Libyans suspected in connection with the bombing for trial before a Scottish court in the Netherlands. One of these suspects, Abdel Basset al-Megrahi, was found guilty; the other was acquitted. Al-Megrahi's conviction was upheld on appeal in 2002. In August 2003, Libya fulfilled the remaining UNSCR requirements, including acceptance of responsibility for the actions of its officials and payment of appropriate compensation to the victims' families. UN sanctions were lifted on September 12, 2003. U.S. International Emergency Economic Powers Act (IEEPA)-based sanctions were lifted September 20, 2004. On December 19, 2003, Libya publicly announced its intention to rid itself of weapons of mass destruction (WMD) and Missile Technology Control Regime (MTCR)-class missile programs. Since that time, it has cooperated with the U.S., the U.K., the International Atomic Energy Agency, and the Organization for the Prohibition of Chemical Weapons toward these objectives. Libya has also signed the IAEA Additional Protocol and has become a State Party to the Chemical Weapons Convention. These were important steps toward full diplomatic relations between the U.S. and Libya.

People of Libya

Libya has a small population in a large land area. Population density is about 50 persons per sq. km. (80/sq. mi.) in the two northern regions of Tripolitania and Cyrenaica, but falls to less than one person per sq. km. (1.6/sq. mi.) elsewhere. Ninety percent of the people live in less than 10% of the area, primarily along the coast. More than half the population is urban, mostly concentrated in the two largest cities, Tripoli and Benghazi. Thirty-three percent of the population is estimated to be under age 15. Native Libyans are primarily a mixture of Arabs and Berbers. Small Tebou and Tuareg tribal groups in southern Libya are nomadic or semi-nomadic. Among foreign residents, the largest groups are citizens of other African nations, including North Africans (primarily Egyptians and Tunisians), West Africans, and other Sub-Saharan Africans. Nationality: Noun and adjective --Libyan(s). Population (July 2010 est.): 6,461,454. Annual population growth rate (2010 est.): 2.117%. Birth rate (2010 est.)--24.58 births/1,000 population. Death rate (2010 est.)--3.45 deaths/1,000 population. Ethnic groups: Berber and Arab 97%; other 3% (includes Greeks, Maltese, Italians, Egyptians, Pakistanis, Turks, Indians, and Tunisians). Religion: Sunni Muslim 97%, other 3%. Languages: Arabic is the primary language. English and Italian are understood in major cities. Education: Years compulsory --9. Attendance --90%. Literacy (age 15 and over who can read and write)--total population 82.6%; male 92.4%; female 72% (2003 est.). Health (2010 est.): Infant mortality rate-- 20.87 deaths/1,000 live births. Life expectancy --total population 77.47 yrs.; male 75.18 yrs.; female 79.88 yrs. Work force (2010 est.): 1.686 million.