• Reference: P-LY-KD0-001
• Approval date: 03/11/2009
• Start date: 03/11/2010
• Appraisal Date: 15/10/2009
• Status: ApprovedAPVD
• Implementing Agency: LIBYAN EXPORT PROMOTION CENTER
• Location: Libya

The Program targets three dimensions of institutional capacity. First, it aims at enhancing the organizational capacity and systems of the Center. Second, it is intended to enhance the managerial capacity of the institution. Third, it seeks to assist the Center in strengthening its capacity and effectiveness in delivering export promotion and business development services.

The proposed activities, which are intended to redress these capacity building aspects, are grouped into two inter-related components: The first component focuses on the organizational and managerial capacities of the Center. The objective is to enhance the effectiveness of the organization and improve the skills of the management team. The second component centers on enhancing the capacity of the Center to effectively deliver export promotion and business development services that correspond to unmet demand by the Libyans SMEs.

The specific purpose is to help develop the institutional capacity and the human resources of the Libyan Export Promotion Center, which – as indicated above - has primarily been set-up to push exporting activities.

The purpose of the proposed activity is to increase engagement with Libya and prepare the ground for future operations largely funded by Government’s contributions. The operation fits well the objectives of MIC Trust Funds, which is partly intended to address critical needs for capacity building, institutional strengthening and private sector development. The underlying argument is that while the case for production and export diversification is strong, there is a good justification for government’s involvement in export promotion in view of the uncertainties facing exporters and the existence of external gains. Enterprises venturing into exporting activities and penetrating new markets normally face high start up and prohibitive costs. Internally, they operate under the remnants of the inward-looking policy regime, an adverse regulatory environment, and inadequate physical, marketing and financial infrastructures, which inflate business transaction cost. Externally, they are subject to stiff competition from countries that have comparative and competitive advantages drawn from cheap labor, relatively more developed human capital and rich endowment with natural resources. As an oil rich country with favorable external balances, Libya’s foreign exchange rate has the propensity to be unfavorable to non-oil exporters.

The Government expects the Libyan Export Promotion Center to go beyond delivering direct trade-related services to exporters by playing advisory and advocacy roles in trade issues. The on-going process of globalization and the re-integration of Libya into world markets following the lifting of sanctions have created both challenges and opportunities for the country. The paucity of technical expertise in trade and export promotion is a major weakness facing the country as it aspires to maximize the benefits from regional cooperation, bilateral agreements and other multilateral arrangements. Libya’s membership of regional and international groupings has given rise to the need to have cadres familiar with trade promotion issues. Its attempt to join the World Trade Organization will eventually require the development of institutional and legal strategies for negotiations. As the country is in its early phase of transition to outward orientations and market principles, it needs to develop appropriate skills for policy formulation, strategic thinking, vision design, export strategy and export promotion. If the Center is to carry out its tasks effectively, it needs to have the requisite institutional capacity and skills. However, at present it does not only have inadequate staffing but also it suffers from shortages in skills.

Beneficiaries of the direct training include managers, senior officials and business leaders, exporters, business men and women and government officials. The staff of the center will also benefit from study visits and short tern external training

SANTI Emanuele - ORNA

Finance source	Amount
MICF	UAC 480,000
Government	UAC 25,000
Total	UAC 505,000