ECONOMIC GROWTH IN LIBYA AFTER 2003 SANCTIONS

Central Bank and globalisation, Economic Growth in Libya after 2003 Sanctions

Central Bank and globalisation, Economic Growth in Libya after 2003 Sanctions

Introduction

The globalization process has started long ago, but the effect is still unknowable for many industries. In recent decades the world has witnessed various financial crises that occurred in many places, Global Finance funds the huge cross-border flows of money that could be a destabilizing influence when things go wrong and lead to a crisis that threatens global financial system itself.

The world has seen many significant changes over the past two decades, especially in developing countries, which has a very effective impact on economic growth and social life. These changes have led to globalization, which began when the worldwide trend of financial opening in 1990 restored the degree of international capital mobility not seen since the beginning of this century. Central banks are those persons having responsibility for the maintenance of economic prosperity and stability through the production and implementation of monetary policy. To be specific, the main task of central banks to maintain the stability of the money supply in the economy and to maintain the stability of the currency. These organizations are the bodies that provide control and monitoring functions to ensure that financial institutions in the economy did not behave irresponsibly.

However, in the era of globalization, which requires corporations to participate in international trade, the elimination of borders, an important question arises whether the government should maintain a state-regulated economy, or the behavior of free-market economy. Two great ideas, by their nature to be contrary, creates a significant improvement in the global economy discussion. The battle of these two ideas going on, emerging in some countries. Libya is one of the examples of countries that continue to open their economies to foreign institutions, including the banking sector. After 30 years as a socialist country, Libya has developed to deal with the challenge of globalization through a series of privatization in the banking sector by allowing the establishment of branches of foreign banks in Libya and the privatization of state-local Libyan banks. This decision marks an economic transformation of Libya, as they continue to deal with the challenge of globalization.

Discussion

Libya is on a path to liberalise its command economy and transition to a market economy by applying for World Trade Organisation (WTO) membership, reducing subsidies, and starting a privatisation process. However, the liberalisation process is not without obstacles. Despite efforts to encourage private sector participation, extensive controls of prices, credit, and trade constrain growth in Libya (www.uam.es).

Access to food and water are additional problems. Currently Libya imports 75 percent of all food and only around 30 percent of the population have access to safe drinking water. Despite these obstacles, Libya's potential is immense. It is home to a welcoming and well-educated population, valuable natural resources, and natural beauty that could assure growth in years to come.

Libya is a foremost oil ...