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Counting the Cost

Libya: Heading towards bankruptcy?

As oil output continues to slide since the fall of the Gaddafi regime, we look at the impact on the country's economy.

Last updated: 15 Mar 2014 08:24
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This week on Counting the Cost, we look at Libya, its oil, and its lost opportunities.

The country is rich in oil, but what does that count for if it may be headed for bankruptcy? And with control over resources now splintered, who is really going to take Libya forward?

The recent newsline has been that an oil tanker, loaded with 'black gold' from a rebel-held terminal, had escaped from the Libyan navy. On the face of it, the incident is an embarrassment to the Libyan government, but it symbolises so much more. A country with the ninth-largest proven oil reserves in the world and a population of 6.5 million should be a wildly prosperous nation but it is not.

Two years since Muammar Gaddafi's regime fell, militias have seized control of Libya's oil production facilities from a seemingly helpless government. Prime Minister Ali Zeidan fled the country, despite a travel ban, after being voted out of office by parliament after the incident with the oil tanker. He is also accused of embezzling public funds.

But Libya's problems go deeper than just one man - even if he was the prime minister. Revenue Watch, a New York-based think tank, believes Libya is heading towards bankruptcy.

The big problem is oil output, which has fallen to 230,000 barrels per day; before the revolution, that number was closer to 1.6 million barrels. That is a huge drop when Libya's oil and gas provides 90 percent of state revenue; in 2013, oil income brought in around $48.7bn.

For Counting the Cost, Al Jazeera's John Hendren, reports from oil port of Zawiyah to see what is really happening inside Libya. We also speak with Oliver Coleman, a senior Middle East North Africa analyst at the risk analysis group Maplecroft, to understand the politics and the war for Libyan oil.

'Alternative finance'

Next, we look at financing, because the North Atlantic financial crisis really did reshape how people get hold of money for their business needs.

In short, regulators are exerting more pressure and putting tougher rules in place; rules that mean banks must keep more cash in reserve to protect themselves from economic shocks.

That, however, has meant less money being leant out to businesses, which in turn means less goes into creating much needed jobs.

So, is there another way?

We look at something called 'alternative finance' with Kamel Alzarka, the chairman and founder of one such financier, Dubai-based Falcon Group.

Tea in India, sun in Senegal

One often hears of the Indian conglomerate Tata - known for steel, cars, and chemicals. But it grows tea as well. And it is coming under criticism over its treatment of tea plantation workers in India.

To remain productive and profitable, tea plantations rely on a large number of workers. And giving these workers company shares is being touted as a way to share profits and improve their lives. But critics charge that it is actually a way to shield the company.

Al Jazeera's Faiz Jamil travelled to India's Assam state, to speak to workers living on a tea plantation.

Finally, to Senegal, where an oasis is being powered by the sun, turning arid ground into fertile land. But the government insists it still needs coal-powered electricity to meet demands.

In the deserts of West Africa, reality is harsh. The hot climate has always meant that growing crops was next to impossible. But we have a story about how the sun's rays are working for the farmers, rather than against them.

For Counting the Cost, Al Jazeera's Nicolas Haque travels to Lampoul in Senegal to find how - despite no rainfalls since October - farmers have all the water needed to grow onions, cabbage, tomatoes, and all sorts of vegetables.

Watch each week at the following times GMT: Friday: 2230; Saturday: 0930; Sunday: 0330; Monday: 1630.  Click here  for more  Counting the Cost.  

Follow Kamahl Santamaria  @KamahlAJE  and business editor Abid Ali @abidoliverali 

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Source:
Al Jazeera
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