German companies eye opportunities in Libya | Business| Economy and finance news from a German perspective | DW | 24.08.2011
  1. Inhalt
  2. Navigation
  3. Weitere Inhalte
  4. Metanavigation
  5. Suche
  6. Choose from 30 Languages
Advertisement

Business

German companies eye opportunities in Libya

As the battle for control over Libya enters its final stages, German companies are gearing up to secure themselves a slice of the reconstruction pie.

An oil worker repairs a pipeline

There is a lot of modernizing to be done in Libya

During his four decades in power, Moammar Gadhafi milked his oil- and gas-rich country to accumulate extreme wealth for himself and his family, stashing away vast piles of cash in foreign bank accounts.

Much of that money was frozen by Western governments after Gadhafi ordered a military crackdown on political opponents. Authorities froze 7 billion euros ($10 billion) worth of assets in Germany alone.

Now the international community is considering releasing those assets to make them available for reconstruction efforts.

Felix Neugart of the Association of German Chambers of Industry and Commerce

Neugart thinks German firms would be welcome because of their expertise

German Foreign Minister Guido Westerwelle said on Wednesday that Germany had a special role to play in ensuring that reconstruction led to "lasting stability."

"Germany has experience and particular expertise in this area," said Westerwelle. "We will stand by Libya with advice and assistance if it wishes."

Westerwelle also called for a speedy UN resolution to unblock the frozen Libyan assets. Berlin offered a 100 million euro loan to the National Transitional Council on Tuesday, intended for "humanitarian and civil assistance."

Foreign companies are watching the possible opportunities with eager eyes, and as Felix Neugart of the Association of German Chambers of Industry and Commerce (DIHK) told Deutsche Welle, there is plenty of scope for German businesses to get involved in rebuilding Libya's infrastructure.

"German firms are well placed to help with all aspects of creating a sensible infrastructure," Neugart said. "They would certainly be welcome partners wherever there is a need for a high standard of technical and engineering expertise."

All companies great and small

Among those hoping to take part in the reconstruction are engineering giant Siemens, BASF subsidiary Wintershall, and the service and construction company Bilfinger Berger – all of which have prior experience of working in the North African country.

Siemens company logo outside its buildings. Blue sky above

Siemens was involved in a massive drinking water project in Libya

But after months of conflict between rebel forces and troops loyal to Gadhafi – not to mention decades of systematic underdevelopment - there is also ample opportunity for medium-sized companies to get in on the action too.

In the past, the erratic nature of the Libyan government frightened smaller firms off. Neugart says it was not unusual for high-ranking officials to make incomprehensible political decisions – or develop complex plans that were never actually implemented.

"If that changes, if there is legal security, if the framework for companies - including foreign companies - working there is more clearly defined, I believe Libya will be a very attractive partner for a lot of German companies."

Security comes first

According to the German-African Business Association, roughly 100 German companies were operating in Libya when the fighting broke out earlier this year. Most were involved in the energy industry in one way or another.

Wintershall, for example, first started doing business in Libya since 1958. It was producing 100,000 barrels of oil per day before the unrest began, prompting it to stop drilling activities and fly its international workers out of the country in February.

Rebels in a truck, an oil refinery in the background

German oil company Wintershall stopped its drilling in Libya when the fighting began

Although the German-African Business Association is urging its members to return to the Mediterranean country and pick up where they left off, Wintershall spokesman Stefan Leunig says it is too soon to say when that will happen.

"Technically speaking we could restart production within a few weeks," Leunig told Deutsche Welle. "But our doing so would depend on the state of the export infrastructure and on a stable security situation."

And as long as Gadhafi is still out there vowing to defeat the rebels or die a martyr's death, stability and security are two things that Libya simply cannot offer.

Reporter: Monika Lohmüller / tkw, rc
Editor: Sam Edmonds

DW recommends