Libya Seeks Economic Pivot Amid $37.2 Billion Funding Shortfall

The African Development Bank’s 2026 Country Focus Report identifies infrastructure as the primary driver of these capital needs. While an oil production recovery fueled a 12.4% economic expansion in 2025, growth is projected to moderate to 6.5% in 2026 and 4.3% in 2027. Malinne Blomberg, the Bank’s Deputy Director General for North Africa, emphasizes that Libya’s substantial resources could drive diversification only if the government modernizes public financial management and expands business access to credit.

Reforms and Financial Integration

Following a unified national budget agreement in April 2026, the report advocates for increased transparency and tighter coordination among financial institutions to replace a decade of fragmentation. Beyond government spending, the strategy calls for tapping into diaspora flows, foreign investment, and public-private partnerships. To unlock these capital sources, the report highlights the need for robust legal frameworks and predictable policies. Simultaneously, the National Strategy for Financial Inclusion 2025–2029 aims to lower barriers for local businesses by expanding digital financial services and strengthening banking supervision, moving the country toward a more resilient, multi-sector economic model.