By Sami Zaptia.
Tripoli, 22 November 2021:
Mahmoud Ajaj head of Libya’s Housing and Infrastructure Board (HIB) said that only about a third (US$ 13 bn) of the total projects contracted up to 2011, amounting to US$ 40 bn, were completed by his agency.
The head of the HIB was speaking yesterday at the by-invitation-only American Chamber of Commerce in Libya’s (AmCham Libya) event at the Mahari Radisson Blue hotel hosting the first U.S. business delegation to visit Libya in ten years. The delegation included representatives of Bechtel, Caterpillar, GE, Hill and Pratt and Whitney.
Speaking during the afternoon’s infrastructure panel, Ajaj said the Abd Alhamid Aldabaiba government has done more in its 6 months in office than previous governments in 10 years through it ‘‘Reviving Life’’ programme.
Ajaj, who took over as head of HIB in 2013, reminded that the HIB, established in 2006, was implementing 79 housing complexes in 41 cities totalling 250,000 housing units – across Libya. He said they had signed contracts with companies from 32 countries.
Projects with Libyan companies to kickstart the economy
He said a group of mostly completed or easy to complete (overwhelmingly with Libyan companies to be paid in Libyan dinars rather than the difficult-to-get-approved hard currencies) projects were started to kickstart the economy and move the country forward. He said contracting and construction can act as the backbone of Libya’s economic progress.
Ambitious plans for 2022
Ajaj revealed that the HIB has ambitious plans for 2022 but emphasised that it needed foreign help to implement them – including project managing American group AECOM.
Ajaj heaped praise on AECOM’s work before the instability forced it to leave the country. He revealed it was keen to return but U.S. travel restrictions prevented from returning. AECOM had signed a contract with HIB in 2007 to act as project manager and put in place a masterplan for 4 years. He was hopeful they would be back after the 24 December elections as their contract was still valid.
The HIB head said they had prepared a group of projects to be implemented next year including replanning 14 cities beginning with Tripoli and Benghazi. He said a major new city will be build on the outskirts of Tripoli.
He admitted that it was unrealistic to demolish the billions worth of unplanned construction that has taken place over the last few decades – mostly on agricultural land.
Ajaj said a new Tripoli masterplan will be introduced covering about 40,000 hectares and a similar one for Benghazi covering about 33,000 hectares. He emphasised that Libya needed the help of U.S. companies in this and to help create a 30-year plan divided up into 5-year plans.
New cities to be PPP or mainly by private sector
He revealed that a new 20,000-hectare Tripoli city and a 17,000-hectare Benghazi city will be revealed in 2022. These will be ‘’90 percent funded by the private sector’’ in order to open up Libya and the sector for private investment – and change the country from a rentier state to an open economy.
Libya’s banks to finance investments through loans
Ajaj admitted that the Libyan state will no longer have the budgets to finance Libya’s ambitious investment and development plans. He expected that the circa LD 80 billion that Libya’s banks are sitting on will be used to finance such projects through loans
Ajaj admitted that there were challenges for investors and that that had stood by Libya will not be forgotten – but he said there were even more opportunities in Libya.
Why did Egypt get new contracts?
The HIB head confirmed the news that a group of Egyptian companies had been awarded the US$ 5 bn contract to complete the Third Ring Road that Brazilian company Oderbrecht had failed to complete. The contract was currently with the Audit Bureau and Hill International was going to act as project manager.
He confirmed that Egyptian companies had received the contract because they were prepared to bring their nationals and start working as soon as the contract was approved.
New tenders on offer next year
Tantalisingly, but without giving any details away, Ajaj revealed that a group of new contracts will be offered next year through open tender.
Contracts and arbitration
Ajaj also had some comments on arbitration, types of contracts and contrasted how some companies sought compromise solutions while others did not.