The Effort of Economic Growth through Foreign Direct Investment in Libya

Abstract

Today, most countries strive to attract foreign direct investment (FDI) because of its acknowledged advantages as a tool of economic development. Africa and Libya in particular joined the rest of the world in seeking FDI as evidenced by the formation of the New Partnership for Africa's Development (NEPAD), which has the attraction of foreign investment to Africa as a major component. North Africa as a region now has to depend very much on FDI for so many reasons, the preference for FDI stems from its acknowledged advantages. Foreign direct investment (FDI) is an integral part of an open and effective international economic system and a major catalyst to development. Yet, the benefits of FDI do not accrue automatically and evenly across countries, sectors and local communities. National policies and the international investment architecture matter for attracting FDI to a larger number of developing countries and for reaping the full benefits of FDI for development. The challenges primarily address host countries, which need to establish a transparent, broad and effective enabling policy environment for investment and to build the human and institutional capacities to implement them. Hence, in this report, we description the effort on foreign direct investment in Libya and evaluate the effort on foreign direct investment in Libya and What are the challenges faces by Libya on foreign direct investment and propose possible solution through looking at various factors that hinders or support foreign direct investment.