The Egyptian-Libyan relations are witnessing a tangible development recently, which has been remarkably reflected in huge economic agreements, the signing of several memoranda of understanding between the two sides, and Egypt's acquisition of a large share of the huge reconstruction projects that Libya seeks to implement in the coming months.
A few days ago, Libyan Prime Minister Abdel Hamid al-Dabaiba signed contracts with Egyptian companies to implement the project to complete the Third Ring Road, which has been suspended since the beginning of 2007, with a total length of 23.8 km, and a value of about $930 million.
The Libyan government had also signed contracts before that with a consortium of Egyptian companies, to implement two projects for the maintenance and expansion of the “Ubari-Ghat” (west) and “Ajdabiya-Jallow” (east) roads, which come within the framework of agreed projects worth billions of dollars, within the energy sectors, Electricity, oil, infrastructure, health and education, housing, administration and public service.
A study by the United Nations Economic and Social Commission for Western Asia (ESCWA) estimated that the countries neighboring Libya would account for about $160 billion in the value of projects allocated for reconstruction, within 4 years, which would contribute to reducing the unemployment rate by about 6% in Tunisia, 9% in Egypt, 14% in Sudan.
Observers expect that Egyptian companies will acquire between 60 and 70% of the reconstruction projects in Libya, which represents a qualitative leap in the level of relations. Experts believe that it will have a significant positive impact on the Egyptian economy, and will also represent an added value for political stability in the region.
Mr. Al-Siddiq Omar Al-Kabeer, Governor of the Central Bank of Libya met on Tuesday 2/8/2022 with Mr. Tamer Mustafa, the Ambassador of the Arab Republic of Egypt to Libya.
Several issues of common interest were discussed, and the latest developments in the project to unify the Central Bank of Libya were discussed, and Egyptian companies started working in Libya.
pic.twitter.com/YchTtFLjfN
— Central Bank of Libya (CBL) (@CentralBankOfLy) February 8, 2022
Egyptian bet
Economist Mustafa Abdel Salam confirms that the Libyan economy is very important to its Egyptian counterpart, and considers Cairo’s bet on Tripoli, and its economy can come out of several crises, pointing out in this context that Libya, during the era of the late President Muammar Gaddafi, was an important source of foreign exchange, as it was A major destination for its exports and products.
He explained, in his speech to Al Jazeera Net, that the Egyptian contracting companies considered Libya their second market, and then Egypt was reaping billions of dollars annually, whether in the form of exports or bank transfers, which it seeks to restore, through its recent repositioning. in relations with her neighbour.
Despite the fact that the Egyptian government and its Libyan counterpart concluded these agreements and contracts, and the Libyan Minister of Economy announced his country’s readiness to receive one million Egyptian workers who will be raised to 3 million within 3 years, Abdel Salam believes that it is too early to expect Libya’s readiness to implement this, as its government is transitional, and with the postponement of the elections. It cannot be considered ready to start massive reconstruction projects.
Abdel Salam pointed out that despite these agreements, Egyptian labor faces fierce competition, whether from cheap African labor or from the point of view of major international contracting companies, and therefore it is necessary to wait for the elections, to be clear after which the new government will proceed with the previous agreements. Or, you can review those contracts.
In the event that these agreements are approved, Abdel Salam expects that this will be reflected strongly on the Egyptian economy, which is looking for additional dollar resources, which will then be represented in the expected transfers of Egyptians, and the revenues of contracting companies and exports, which prompts Egypt to ensure that it is number one in the world. Reconstruction projects.
The economic expert adds, in this context, that in light of reading the current scene, it is clear that the Libyan government is enthusiastic about the Egyptian presence, and the Egyptian side is keen on this for reasons related to its keenness to stabilize the borders, and to find dollar resources that can be an alternative to external borrowing.
Mustafa Abdel Salam: If the economic agreements between Cairo and Tripoli are approved, this will have a strong impact on the Egyptian economy (Al Jazeera)
not new
The economic expert, Abdel Nabi Abdel Muttalib, considers that this rapprochement and harmony between the two countries is not new, but rather the original. Egypt and Libya's economic relations are historical, and did not stop even under the worst circumstances.
Speaking to Al Jazeera Net, Abdel Muttalib attributed the Libyan government's preference to Egyptian companies, in reconstruction contracts, to their low costs, pointing out that if the announced contracts are completed, it is expected that they will contribute to benefiting the Egyptian economy in many sectors.
He stated that for example, the return of Egyptian companies to the Libyan market, and the provision of huge job opportunities for Egyptian workers, which will contribute to reducing unemployment and poverty rates, and the rise in Egyptian exports, in addition to the increase in the number of Egyptian workers will contribute to increasing remittances of Egyptians abroad.
Despite the postponement of the elections, Abdul Muttalib does not believe that this will hinder the implementation of these new contracts, as they are concluded with an agreed upon legitimate government, and indications of the stability of the situation, and the parties’ agreement not to exceed the areas of their dispute to the use of violence, confirm this.
In the context of talking about the effects of this rapprochement, Abdul Muttalib believes that this will allow Egypt to be reassured on its western borders, and will enable it to focus its efforts on the areas that cause it concern, whether in the southern or eastern borders.
mutual affinity
In turn, Khairy Omar, a professor of political science and an expert in Egyptian-Libyan relations, believes that the recent growth of these relations came as a result of Egypt's stability in the situation in Libya, as it became at the same distance from all parties, and there was no longer anything that could represent rivalry or divergence from its side. towards the political parties in Libya.
He pointed out, in his speech to Al Jazeera Net, that this rapprochement was mutual from the two parties, because each of them was convinced of his need for the stability of that relationship, as Egypt opened its door to the various dialogue sessions of the Libyan parties, and the Libyans also realized that their past disputes were not meaningful or real motive, and helped in This is a general context of reconciliations in the region.
The impact of this economic and political rapprochement, according to Khairi, is greater on the Libyan side, but it is linked to real stability in it, the features of which have not yet been clarified, as a result of the absence of consensus on the stage of the elections and how to conduct them.
Meanwhile, Egypt seeks this consensus by strengthening its relationship with politicians in the Libyan West, in order to avoid any tension on its western borders.
The expert in the relations of the two countries believes that it is too early to determine the consequences of this rapprochement, and to determine the effects of the agreements concluded between them. In his estimation, they are agreements with initials, and the matter is related to the position of the next government, which is supposed to derive its legitimacy from its emergence from agreed elections that express the will of the Libyans.