Murtaza Karanfil, Libya Representative of the Independent Industrialists and Businessmen Association (MÜSİAD), shared his assessments on the political and economic relations between Türkiye and Libya, the future of Libya and the active role Türkiye plays in the region
MÜSİAD Libya Represantative Murtaza Karanfil shared his assessments on the political and economic relations between Türkiye and Libya, the future of Libya and the active role Türkiye plays in the region
Libya Is the 3rd Country Supplying the Most Energy to Europe
Providing information on the current trade volume and potential between Türkiye and Libya, Karanfil noted that Türkiye exported USD 1.5 billion to Libya in 2018 and that, as of 2019, this figure rose with an increase of 29 percent to a level of USD 2 billion. Karanfil said: “At the beginning of the 2000s we had an export volume of USD 96 million to Libya. Between 2011, when the Kaddafi regime was overthrown, and 2014, considerable stability was achieved in Libya. Accordingly, in 2013 we succeeded in reaching USD 2.7 billion in exports with Libya. However, with the arrival of the putschist Hafter in Libya, this figure began to decline in parallel with the deterioration of stability. Hafter's increasing dominance in the region known as the oil crescent, particularly from Sirte to Benghazi, created a snowball effect that caused the exchange rate to rise and the economy to collapse. Although Libya is a country with a population of 6 million, before 2010 it had reached oil revenues of approximately USD 90 billion. It was the 3rd country supplying the most energy to Europe after Russia and Norway. Between 2016 and 2019 it was inflicted losses of approximately USD 100 billion by a group calling itself the Petroleum Facilities Guard.” he said.
A USD 19 Billion Project Could Not Be Realized
Noting that Türkiye's share in the Libyan economy currently stands at around 13 percent, Karanfil stated that with increased stability in Libya this figure could very comfortably be raised to around 30 percent. Karanfil said: “Before 2011, Turkish contracting firms signed agreements worth approximately USD 29 billion in Libya. Before the revolution broke out, USD 10 billion worth of projects had been completed. However, with the flames of the revolution, USD 19 billion worth of projects had to be shelved.”
Pointing out that Turkish firms suffered losses beyond the construction sector as well because of the internal turmoil in Libya, Karanfil used the following words: “ In addition to this, progress payment receivables arising from the completed sections amount to USD 1 billion, the guarantee amount to USD 1.7 billion, and inventory such as machinery and equipment together with other losses totals approximately USD 1.3 billion. Firms are still paying USD 50 million in commission per year for letters of guarantee. This is an important problem, and we believe it must be resolved through the talks to be held with the government during the reconstruction process.”
“We Believe That We Will Take Over the Work With Libya From Where We Left Off and Carry It to Much Better Points”
Noting that work is still continuing under the leadership of the Ministry of Trade to resolve these problems, Karanfil said: “ As you know, at the beginning of 2019 a meeting was held on the “Memorandum of Understanding (MOU) Between the Government of the Republic of Türkiye and the Government of National Accord of the State of Libya”. The meeting, chaired by Minister of Trade Ms. Ruhsar Pekcan and Minister of Planning of the Government of National Accord of the State of Libya Dr. Taher Jehaimi, was attended by the Turkish Contractors Association, the Banks Association of Türkiye, the Association of Contractors Doing Business in Libya and other relevant institutions.
We too are closely following and supporting this process being carried out under the leadership of the Ministry of Trade, and we are expressing our thoughts and suggestions. Both sides are continuing their work on developing economic and investment relations between the two countries, strengthening cooperation, consultation and communication, supporting Libya's development projects, and finding solutions to the problems arising from the projects undertaken in Libya by Turkish contracting, engineering and consultancy companies. We expect that, with a memorandum to be signed between the two countries at the level of the relevant ministries, significant progress will be made in the coming period towards resolving the commercial problems on the contracting side. We hope the memorandum will be signed in a short time. As soon as the old receivables and payables issues are resolved, we believe that we will take over the work with Libya from where we left off and carry it to much better points. Indeed, the Libyan people also believe and expect that Libya has no time to lose on this matter.” he said.
Libya, the Key to Africa
Emphasizing in his statement that Libya is the gateway opening to Africa, Karanfil made the following assessment: “Türkiye has made a significant opening towards Africa in recent years. Libya is of key importance in this context. We are only 3 days away from Libya by sea. This means that, once stability is established in Libya, the products reaching Libya will arrive in Central Africa by road within 3-4 days. This will also enable us to become a supplier country to Central Africa and indeed to the whole of Africa via Libya. In other words, at the end of a 3-day sea distance with Libya, we can easily deliver products anywhere we want in Africa within 1 week. That means tremendous potential in exports. The pandemic process has had a very large impact on trade. We estimate that the next 2 years will pass in this unstable manner. For this reason, we think that consumer countries will choose the countries close to them.”
A Serious Goodwill Towards Türkiye Has Formed Among the Libyan People
Stating that Türkiye took a stand in favour of democracy and human rights from the very first days the revolution began in Libya, Karanfil used the following words:
”Our state stood alongside the Government of National Accord recognized by the United Nations against the putschist Hafter. On this issue, the support of the global powers for the Government of National Accord remained only on paper. With Türkiye's political and military support, the Libyan Government of National Accord made great progress against Hafter's forces. At present, a perception that “Türkiye saved us” has formed in Libya. The Libyan people feel truly great gratitude towards Türkiye. There is a fatwa issued by the Mufti of Libya 20 days ago: it addresses all state officials and merchants in Libya, stating that if the products you will import are available in Türkiye, every penny you will send abroad should if possible be sent to Türkiye, and that trade should be done with Türkiye. We think that steps should be taken in commercial terms by turning this goodwill in Türkiye's favour. Indeed, on this matter, the President of the Libyan Government of National Accord, Fayez Al Sarraj, recently came together with our President and held talks. Taking the pandemic environment into account as well, we can say that oil revenues will fall over the next 2 years and that some countries may turn to tax revenues. That is why I think that, just as we cooperate with Libya on security and on maritime jurisdiction areas, we should also cooperate on the free movement of goods. Perhaps we can establish joint industrial facilities and carry out joint production. In particular, the items whose logistics and production costs are energy-based can be realized through joint projects in Libya with a “win-win” approach.”
Who Is Murtaza Karanfil:
Murtaza Karanfil is the founder of the Karanfil Group, which began operations in 1987, and at the same time its Chairman of the Board of Directors.
He successfully carries out the duties of MÜSİAD Libya Country Representative and Chairman of the Türkiye-Libya Business Council of the Foreign Economic Relations Board (DEİK).
Murtaza Karanfil, who has focused on business partnerships particularly in Libya as well as in the Middle East, founded the Türkiye and Libyan Businessmen Association (TULİB) in 2011 in order to increase sustainable regional development between Türkiye and Libya and to enable the exchange of information and business opportunities.