SMEs in Libya's Reconstruction

Preparing for a Post-Conflict Economy

image of SMEs in Libya's Reconstruction

The report is intended to contribute to the implementation of policies in a post-conflict Libya to promote private sector development. The report analyses the structural economic and framework conditions prevalent in Libya, highlights potential drivers of development and considers the role of SMEs and entrepreneurship promotion in driving post-conflict recovery. Based on international experience and practices, and considering the context of the country, the report identifies the necessary legal frameworks, institutions and policies for the promotion of SME and entrepreneurship. The document is part of a wider MENA Transition Fund project to support the design and implementation of SME policies in Libya.



Executive summary

Libya’s private sector faces many constraints, hampering both its development and growth potential. The recent conflict has made the situation dire. This report analyses the structural economic and framework conditions affecting private sector development in Libya. It includes recommendations to support the survival and growth of SMEs, as they will play an important role for the stability and long-term development of the country. The private sector accounts for only about 5% of Libya’s GDP. A full 95% of private enterprises are SMEs, often operating in the informal economy. They perform poorly when it comes to generating employment, productivity, competitiveness and value added.


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