In recent years, China has gradually re-established its presence in Libya, advancing its influence through a combination of strategic investments in infrastructure, energy, and reconstruction projects. This slow but steady commercial expansion is not only critical to Libya’s recovery but also reflects China’s broader global ambitions, especially through the Belt and Road Initiative. By focusing on key sectors such as infrastructure development and oil, China is positioning itself as a dominant player in Libya’s economic recovery while securing its own long-term interests.

RE-ENGAGEMENT AFTER CONFLICT: A Thoughtful Approach

Following years of political instability and civil war, many international businesses withdrew from Libya. However, China has taken a patient and strategic approach to re-engage with the country. In 2024, the Forum on China-Africa Cooperation (FOCAC) in Beijing saw Libya and China elevate their relationship to a formal strategic partnership. This collaboration aligns Libya’s need for reconstruction with China’s capacity to deliver large-scale projects, particularly in infrastructure. China’s neutrality during Libya’s civil conflicts allowed it to maintain a favorable position with both sides of the country’s political spectrum, which has been crucial for its return.

Before the 2011 uprising, Chinese state-owned enterprises were heavily invested in Libya’s energy sector. Now, China is eager to reclaim its position in the oil industry, given Libya’s vast reserves. Chinese firms are currently focused on rebuilding essential infrastructure that had been destroyed during the civil wars, while also pushing for new energy agreements.

KEY SECTORS – They are numerous

China’s strategy for commercial success in Libya centers on infrastructure development and oil, two critical components for both nations. During the First Libyan-Chinese Economic Forum in 2024, 84 Chinese companies participated, exploring opportunities in Libya’s reconstruction plan, “Return of Life,” which focuses on vital infrastructure like roads, ports, and housing. One of the most significant projects under discussion is the construction of a new seaport in Al-Zawiya, which would boost Libya’s trading capabilities and connectivity.

Additionally, the number of Chinese workers in Libya has risen dramatically in recent years, from 5,000 to over 23,000 in 2024 alone. This reflects the growing scale of Chinese involvement in Libyan projects, signaling long-term commitments.

If we consider just recent events the scale of the engagement becomes evident, engagement such as

  1. FOCAC Economic Partnership: Lan Economic Partnership Agreement with China during the 2024 China-Africa Cooperation Forum (FOCAC) that emphasises modernisation and deeper collaboration, reflecting Libya’s inclusion in China’s Belt and Road Initiative.
  2. During this above event, Libya and China discussed expanding their cooperation in the energy sector, focusing on modernising oil production infrastructure. Chinese companies, including Huawei, have been helping Libya’s National Oil Corporation (NOC) explore alternative energy technologies to support the oil and gas sectors. This includes discussions about integrating renewable energy solutions to enhance the efficiency of oil production and reduce the carbon footprint of Libyan oil operation
  3. This partnership aims to leverage China’s technological expertise, especially in renewable energy and smart grids, while helping Libya stabilize and grow its oil output, which remains crucial to the country’s economy despite the push for diversification. Additionally, Chinese energy companies have expressed interest in collaborating on projects to restore and enhance Libya’s oil refining capacity and export infrastructure, further strengthening the bilateral relationship in the energy sector.
  4. Infrastructure Development: China is involved in several infrastructure projects (particularly in the East) focusing on rebuilding essential infrastructure like roads, bridges, and public facilities.
  5. Transport and Trade: Libya’s ports, such as Misrata, are undergoing modernisation with Chinese participation enhancing economic ties between the two countries​
  6. Steel Industry and Manufacturing Expansion: LISCO is a focal point for Chinese investment. Chinese firms have shown interest in upgrading the steel manufacturing capacity of Libya as part of broader industrialisation initiatives but it also helps them in securing strategic materials like iron ore and steel. ​
  7. Free Zones and Special Economic Areas: China has been instrumental in assisting Libya with the development of free zones, particularly around key port cities like Misrata and Benghazi. Whilst these zones help attract foreign direct investment, facilitate trade, and develop industrial hubs. Chinese companies are actively involved in setting up operations in these zones, benefiting from tax incentives and Libya’s strategic location for Mediterranean trade​
  8. Manufacturing Partnerships: In addition to steel, China is working with Libya to enhance the manufacturing sector by investing in assembly plants and factories for products like automobiles and electronics. This partnership takes advantage of Libya’s relatively low-cost labour and proximity to European and African markets.

So, what is Libya’s Role in China’s Global Aspirations?

China’s commercial strategy in Libya fits seamlessly with its global ambitions, especially through the Belt and Road Initiative. Libya’s strategic location, bridging Europe, Africa, and the Middle East, makes it a crucial point for Chinese investments aiming to expand influence in the Mediterranean region and beyond. By helping Libya rebuild and improve its infrastructure, China is securing key logistical routes for global trade, while also gaining a stronger foothold in North Africa.

Libya’s vast oil reserves are also an important factor in China’s involvement. Securing energy resources has always been a critical element of China’s foreign policy, and by re-engaging with Libya’s oil industry, China is enhancing its own energy security. This aligns with China’s long-term global strategy of reducing dependency on traditional oil markets while securing favorable agreements in emerging and post-conflict regions.

Diplomatic Influence and Economic Impact

China’s patient diplomatic engagement in Libya reflects a broader strategy of increasing influence through economic cooperation and infrastructure development. By fostering trust with both the western and eastern factions in Libya, China has avoided the pitfalls that other foreign powers have encountered. Its neutrality has allowed it to re-establish strong relations with the Tripoli government while also engaging with the Haftar-led forces in the East.

Diplomatically, China supports Libya’s national sovereignty and emphasises long-term cooperation in rebuilding the nation. This strategy is not only fostering deeper economic ties but also positioning China as a vital player in the stabilisation and future development of the region  .

Conclusion: A Strategic and Long-Term Approach

China’s commercial and diplomatic success in Libya illustrates its broader global strategy of expanding influence through economic and infrastructural development. By addressing Libya’s critical needs, China is securing both immediate economic benefits and long-term geopolitical influence. As Libya continues its journey towards stabilisation and recovery, China’s role in its reconstruction will likely expand, positioning Beijing as a key partner in shaping Libya’s future.

So, back to the beginning, SHOULD WE BE WORRIED OR SHOULD WE APPLAUD!

To be honest, commercially I think I am tempted to applaud their initiative’s  👏  👏  👏