NATURAL RESOURCES IN RELATION OF FOREIGN DIRECT INVESTMENT AN EMPIRICAL STUDY ON LIBYAN ECONOMY

Abstract

The availability of natural resources both in terms of quantity and quality is a prerequisite for the success of any investment programme. The paper aims to examine whether or not natural  resources in Libya is appropriate to attract foreign companies, particularly in the non- hydrocarbon sectors.  Paper method used is based on qualitative research through two methods of data collection. A survey which was conducted by using a questionnaire with representatives of the foreign and joint companies. A structured interview technique was also used to gauge the opinions of the senior Libyan officials in improving the investment climate. The study reveals that despite the numerous obstacles and shortcomings associated with natural resources in Libyan economy, it is relatively favourable for attracting FDI to the non-oil sectors. It also shows the majority of foreign companies depend on local natural resources in the production process. However, it discovered that the scarcity of natural resources constitutes a major problem for manufacturing companies. The paper recommends themes that Government should use to improve Libyan investment climate which has been launched by Privatization and Investment Board (PIB), such as building investment map and to encourage partnerships between foreign and local investors by facilitating the procedures for joint projects.