The history of Libya's agricultural development has been closely
related, although inversely, to the development of its oil industry.
In 1958, before the era of oil wealth, agriculture supplied over
26 percent of GDP, and Libya actually exported food. Although
gross levels of agricultural production have remained relatively
constant, increasing oil revenues have resulted in a decline in
agriculture's overall share of national income. Thus, by 1962
agriculture was only responsible for 9 percent of GDP, and by
1978 this figure had tumbled to a mere 2 percent. Even more striking
than the downward trend in agriculture's share of GDP was the
rise in food imports. In 1977 the value of food imports was more
than 37 times greater than it had been in 1958. Therefore, a large
part of the rising oil wealth between 1960 and 1979 was spent
on imported food products.
To some extent, these trends were neither surprising nor disturbing.
Libya's comparatively strong agricultural position in 1958 masked
an even greater level of general poverty. Agriculture during the
1950s was characterized by low levels of productivity and income.
The advent of oil wealth provided many peasants with opportunities
to engage in less exacting and more remunerative work in the urban
areas, resulting in a huge rural migration to the cities. In addition,
Libya is not well endowed with agricultural resources; over 94
percent of the land consists of agriculturally useless wasteland.
The large number of people engaged in agriculture prior to 1960
reflected, therefore, not a thriving agricultural economy but
merely the absence of attractive alternatives.
The number of peasants who gave up farming to look for jobs in
the oil industry and in urban areas rose dramatically throughout
the 1955-62 period. Another adverse effect on agricultural production
occurred during the 1961-63 period, when the government offered
its citizens long-term loans to purchase land from Italian settlers.
This encouraged urban dwellers to purchase rural lands for recreational
purposes rather than as productive farms, thereby inflating land
values and contributing to a decline in production.
Since 1962 Libyan governments have paid more attention to agricultural
development. The government has given inducements to absentee
landlords to encourage them to put their lands to productive use
and initiated high agricultural wage policies to stem the rural-to-urban
flow of labor. These policies met with some success. Production
levels began to rise slightly, and many foreign workers were attracted
to the agricultural sector. Agricultural development became the
cornerstone of the 1981-85 development plan, which attached high
priority to funding the GMMR project, designed to bring water
from the large desert oasis aquifers of Sarir and Al Kufrah. Agricultural
credit was provided by the National Agricultural Bank, which in
1981 made almost 10,000 loans to farmers at an average of nearly
LD1,500 each. The substantial amounts of funds made available
by this bank may have been a major reason why so many Libyans--nearly
20 percent of the labor force in 1984--chose to remain in the
agricultural sector (see table 4, Appendix).
Despite the greater attention to agriculture, however, in 1984
this sector only accounted for about 3.5 percent of GDP, and Libya
still imported over 1 million metric tons of cereals (up from
612,000 metric tons in 1974). Also in 1984, the average index
of food production per capita indicated a decline of 6 percent
from the period 1974 to 1976. On the average, about 70 percent
of Libya's food needs were met by imports during the mid-1980s.
Data as of 1987