Libyan Investment Authority

Stock performance

History

The Libyan Investment Authority was created in 2006, as Libya emerged from international sanctions, to invest surplus oil revenue abroad on behalf of future generations. Within a few years it built up a large portfolio of stakes in banks, listed companies, real estate, and funds, but in 2011 the UN Security Council froze most of its assets as part of sanctions imposed during the uprising against Gaddafi, and they have largely remained frozen since.

Business model

The LIA manages a portfolio estimated at around $70 billion spread across listed equities, bonds, real estate, and direct investments in Africa and Europe, through subsidiaries such as the Libyan Foreign Investment Company and the Libya Africa Investment Portfolio. Because of the asset freeze it cannot freely reinvest or rebalance much of that portfolio, and it has lobbied the UN for changes allowing it to manage frozen funds more actively.

Market position

The LIA is one of Africa's largest sovereign wealth funds, though its effectiveness has been limited by sanctions, governance disputes during Libya's political division, and losses on some early investments, which led to high-profile lawsuits against international banks such as Goldman Sachs that the fund lost.

Country impact

The LIA's assets represent a large share of Libya's national savings outside oil in the ground, and their eventual unfreezing and management are seen as important to the country's post-conflict reconstruction and to building a more diversified economy.