The African Development Bank Group has published a policy note identifying concrete, sequenced pathways for private sector-led recovery in Libya, targeting job creation, regional cohesion, and resilience in an environment of global volatility.
Titled Investment for Peace and Prosperity: Leveraging Libya's Private Sector for Resilience and Inclusive Growth, the policy note identifies food security, connectivity, and economic diversification as priority areas where targeted investment can deliver early peace dividends. It particularly highlights strategic connectivity investments as important enablers of private sector recovery, domestic market integration, and wider regional connectivity.
"Libya's private sector has shown remarkable resilience under extraordinary pressure," said Yero Baldeh, African Development Bank Director for the Transition States Coordination Office. "This policy note is designed to help the Libyan authorities, the African Development Bank and its partners channel investment toward the actors and sectors that are already sustaining livelihoods and trade across Libya's regions.
The study also identifies several practical areas for action. These include stronger coordination through a National Private Sector Development Coordination Platform; improved access to finance through a Credit Guarantee and Risk-Sharing Facility for MSMEs, and support for entrepreneurship through a National MSME and Innovation Network connecting incubators, chambers of commerce, universities, and business associations.
The recommendations are organised around three mutually reinforcing pillars: strengthening the institutional and data framework for private sector development; operationalising a public-private partnership (PPP) framework suited to fragile environments; and empowering MSMEs through credit-guarantee facilities, digital financial services, alternative credit-scoring models, and diaspora co-investment instruments.
"The analysis confirms that there is no shortage of economic opportunity in Libya, what is needed is a credible framework to unlock it," said Malinne Blomberg, Country Manager for Libya and Deputy Director General of the AfDB in North Africa. "This policy note provides that framework and positions the Bank to play a catalytic role in Libya's recovery at a moment of renewed institutional momentum."
The policy note advances a peace-positive investment framework, an approach grounded in the Bank Group's Strategy for Addressing Fragility and Building Resilience, which positions private sector development, job creation, and market-based solutions as structural drivers of stability. It argues that MSMEs, informal trade networks, and cross-regional supply chains already perform stabilising functions on the ground and that targeted investment can amplify those contributions.
The publication reflects the AfDB's deepening engagement in Libya as part of its broader fragility and resilience mandate in North Africa. Aligned with the Bank's Private Sector Development Strategy (2021-2025), the policy note provides a foundation for further deepening the Bank's partnership with Libya and sets out a phased engagement model that connects analytical work to targeted pilots and, to scalable investment.
Click here to read the policy note
