Libyan investments In Africa – what now? | LusakaTimes

As the people’s revolutions sweep across the Middle East from Morocco to Bahrain, a number of analysts including the author have started wondering about the new political and economic order of that region, after the dust has settled down. For further discussion, the Middle Eastern region undergoing the turbulences can be divided into two parts: the Maghreb region comprising of countries of North Africa like Morocco, Algeria, Tunisia, Libya and Egypt and these are countries in the proximity to the European Union. The second part comprises of countries in the Arabian Peninsula like Saudi Arabia, Syria, Jordan, Yemen and the Gulf States including the Emirates, Bahrain, Oman and Kuwait. Quite surprisingly Iran and Iraq are out of these revolts as those countries have specific problems of their own.

The consequences of what is happening in this region have a global impact due to a number of reasons and their effects have been amplified by the global impact of news transmission. This allows for people in this region to see and want to imitate what is happening in other countries. Thus, the Egyptian revolutions has been attributed to innovations in communication technology like Tweeter and/or Facebook. The second reason why events in that region have a global impact is that the region consists of countries that are major producers of crude oil, by far the most strategic commodity in the World. Libya accounts for 2% of global oil production and 10% of the oil used in the European Union. Thirdly, the region is the passage way for the majority of products involved in international trade through the Suez Canal. Indeed, the Suez Canal is the major route connecting Europe to Asia and to some extent to America. The supply of various raw materials and finished products, of which the most important is crude oil pass through here. The Suez Canal is also a path route for the telecommunications fiber network that facilitates phone, email, internet communications between Europe and Asia. Fourthly, the region is undergoing dynamic changes as regards to demographic issues – youths account for the majority of the population, an increase in fundamentalism (especially Islamic) and social tensions including the role of women in society. The equation is made more difficult by the Palestinian issue and the future of Israel in the region, dominated by Arab states that might not necessarily be friendly to it.

Another of the major impacts of the revolution in the Middle East is economical, especially the global role of huge funds that are owned by those states. I have in mind investments undertaken by those states through specific Sovereign Wealth Funds, especially those of major oil producers like Libya.