WB: Libya’s Per Capita Income Plunges

A decade of violent conflict and political divisions has caused Libya’s per capita income to plummet by half since 2011, a stark reversal for what was once one of the wealthiest societies in the region, according to a World Bank study published this week.

The analysis found that per capita GDP in the North African oil producer declined 50% between 2011-2020 amid chronic instability stemming from the NATO-backed uprising that toppled dictator Muammar Gaddafi.

Had Libya continued its pre-revolt growth trajectory, per capita income could have risen 68% over the period, World Bank experts concluded. The country’s economy contracted 1.2% last year due to blocked oil exports.

The study underscored Libya’s dependence on hydrocarbon revenues, which account for 97% of state income. Public debt has soared to 77% of GDP. The interim government in Tripoli recorded a reduced budget surplus in 2022 as public spending pressures increase.

Without a sustainable political resolution to reunify governing institutions, the World Bank warned Libya’s living standards will continue deteriorating. A coordinated national economic vision, transparent public finances, and inclusive social policies are critical to recovery, the report said.

Humanitarian conditions improved slightly in 2022 but remain concerning, with over 90,000 registered refugees and displaced people prior to recent devastating floods. The World Bank noted the urgent need to support vulnerable groups through enhanced social safety nets.

Libya’s conflict since 2011 has extracted a steep socioeconomic toll, reversing many of the oil-funded welfare state’s previous development gains.