Dear Editor,
In response to your news item dated January 1, 2014 regarding the GNC’s decision to discuss the law for the . . .[restrict]return of expropriated property, it appears to me that today there is still no clear strategy or direction for resolving one of the most pressing economical problems Libya faces. However, I believe that breaking up and prioritising these property issues into manageable categories could achieve progress faster than presently assumed.
At a time of general unrest and dissatisfaction with the government’s political progress, the fear of increasing tension amongst the population by inadequately addressing this very emotional issue is certainly deterring the present government from taking action on this matter. It may also account for why the GNC is so reluctant to commit itself on the matter and a timeframe for resolving it.
The government is evidently unable to provide an accurate estimate of the number of people affected by Law No. 4 and thus unable to assess the effort and resources required to address the matter. According to the president of the “Association of Owners Affected by the Rule of a Tyrant”, the numbers range from an estimated 80,000 families up to as much as one-third of the population (based on a UNHCR report) who may have been tenants in 1978 when Law No. 4 was passed.
However, continuously postponing kick-starting the private sector by releasing the real estate market is detrimental to the economy and will ultimately force Libya to its knees, considering the disproportional and unhealthy reliance on governmental subsidies and income.
By diverting the focus from the very complicated issue of occupied housing and shifting attention towards more unambiguous property aspects, the GNC is already in a position today to prioritise measures, while maintaining public peace and bringing about movement in the private sector. Divide and conquer is the name of the game.
I would argue that there are probably three main property categories the government could prioritize entailing varying degrees of complexity:
- Expropriated land without buildings. This being the most obvious category where the government is in a position to take immediate action. If rightful ownerships can be established and no buildings have been erected on the claimed land, there is nothing stopping the government from officially returning land to its rightful owners short-term without the need for compensation.
- Expropriated property (land or buildings) taken over for state usage. This, I believe, is another uncontentious category where the government is directly obliged to compensate the rightful owners. However, the way compensation is to be structured requires a detached analysis and evaluation.
- Expropriated housing with private residents. This category should be split into two groups, differentiating between occupants having lived continuously in houses since the time of the passing of Law No. 4, and those who bought the property from prior tenants. As this is the most controversial category of all property discussions, the GNC would be well advised to seek consultation from countries that have successfully faced and resolved similar types of issues in the past, such as Germany, Poland and Hungary.
It is difficult to estimate how many of the expropriations would be resolved by addressing the first two categories, but I believe it is fair to say that moving forward in this or in a similar manner would send a clear signal about progress and ultimately place more confidence in the private sector of the Libyan economy. However, the level of organisation, the required discipline and the need for absolutely unbiased and competent decision makers during the process should not be underestimated.
Yours sincerely,
Omar N. Farhat
Partner and Managing Director
OPC – organisations & projekt consulting GmbH
Düsseldorf, Germany
4 January 2014:
email provided [/restrict]
