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Before Libya became an independent country in 1951, it has a complex early history dating back to 10,000 years BC, when Neolithic cultures broke cattle and cultivated crops in the coastal region (Ahlbrandt, 2001). Proceeding to its independence, Libya was subject to wave after wave of military invasions and occupation by the Phoenicians, the Carthaginians, the Greeks, the Romans, the Vandals, the Byzantines, the Turks of the Ottoman Empire, the Spanish and finally Italians (Farley, 1971; Fisher, 1985; Ahlbrandt, 2001).The Turks of the Ottoman Empire occupied Libya in the mid-16th century; Libya remained part of their empire (1551-1911) until Italy invaded on 3 October 1911.

Italy’s Libyan colonisation separated the country into three counties, Tripolitania in the west, Cyrenaica in the east, and Fezzan in the south. These regions faced miserable conditions throughout the period of Italian colonial rule until 1943. More precisely, the policy of Italian Fascism undertaken in Libya was unique, as has been described by Anderson (1984, p. 346):

In fact, the Italian occupation was to present an attempt to dismantle a regular, extensive political and economic system and to replace it with a second system that had few ties and no precedents in the province and, as it soon became clear, no place for local participation. The jihad was a simple and eloquent way to describe and to rally support for the defense of the new status quo, of the structures by which the province -particularly its notables-had been linked over the previous seventy-six years to the political and economic system of the Ottoman Empire.

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However, Libyans did not give in to colonialism and rejected the Italian settlement; Libyans fought many battles across the country against the Italian occupation. Omar al- Mukhtar was the most prominent leader of the jihad against the Italian occupation as the leader of the jihadist movement in the Green Mountain area.

After defeating Italy in World War II, Libya fell under the Allies army occupation from 1943 to 1949, and it divided again: Tripolitania and Cyrenaica were controlled by Britain, while Fezzan was under the administration of the French. On November 21, 1949, the United Nations General Assembly (UNGA) approved a determination which said that the three separate counties (Tripolitania, Cyrenaica and the Fezzan) had to be established as completely self-governing, becoming an independent sovereign state no later than the first of January 1952. On December 24, 1951, Libya gained its independence as the United Libyan Kingdom (the official state name). It became the first African state to achieve independence from European rule and the first and only state created by the General Assembly of the United Nations (Paoletti, 2011).

After the declaration of its independence in December 1951, Libya announced a constitutional and a hereditary monarchy ruled by King Idris Al-Sanussi, with a federal constitutional system. The country was divided into the three provinces of Tripolitania, Cyrenaica and Fezzan based on the constitution promulgated in October 1951. In April 1963, the federal system was replaced by a unified system; the United Kingdom of Libya became the Libyan kingdom thereafter.

few years later, on September 1st, 1969, a military coup d’état occurred in the city of Benghazi. It was carried out by a small group of army officers, and abruptly ended the hereditary monarchy which had ruled the country for approximately two decades. After that, the official name of Libya (the Libyan kingdom) was immediately changed to the Libyan Arab Republic, and the country was thenruled by the Revolutionary Command Council (RCC).

The RCC disseminated a decree in November 1976 to create the General National Congress of Arab Socialist Union (ASU), which was de facto the only legally permitted party in Libya. “Domestically, the RCC. sought to directly involve the Libyan masses in the programmes of the revolution by organising them into a Nasser- style Arab Socialist Union which was an alliance of wor ing people” (Hajjar, 1980, p. 184).

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Shortly afterwards the SU was officially renamed to be became the General People’s Congress (GPC) in 1977, intended to replace the RCC, which had been the uppermost political authority in Libya since the Constitutional Declaration of 1 December 1969. On 2nd March 1977, a new political direction took form in the country, after the GPC adopted the “Declaration of the Establishment of the People’s uthority” and proclaimed that Libya was the Socialist People’s Libyan rab Jamahiriya “state of the masses”. s stated by (Hajjar, 1980, p. 187)

Political power was transferred to the basic people's congresses, their committees, and the General People's Congress. Also, the traditional form of government, along with the institutions and offices of the Cabinet, Ministers, Directors, etcetera, were abolished in favour of a General Secretariat of the General People's Congress, comprised of a Secretary-General and a number of other Secretaries, each responsible for one of the activities of the state.

Among the RCC members, Muammar Al-Gaddafi turned out to be the leader of the RCC as well as Commander in Chief of the Libyan armed forces and eventually as in fact Head of Libya, practicing unlimited authority for more than four decades until February 17, 2011 when the Libyan revolution took place. The Libyan revolution exploded against the Al-Gaddafi regime’s repressive policies. On February 27, 2011, the Libyan rebels proclaimed the creation of an Interim Transitional National Council (ITNC) in the city of Benghazi, which was intended as an interim government instead of the Gaddafi regime.

On August 3, 2011, the ITNC issued a Draft Constitutional Charter for the Transitional Stage. It was intended to address Libyans’ concerns about the ITNC’s authority as an unelected committee. The Constitutional Declaration was composed of 37 Articles divided into five chapters: (1) general national principles; (2) rights and public freedoms; (3) transition to an interim government; (4) judicial guarantees; and (5) the status of existing laws. In addition, the document confirmed the ITNC as the only legitimate governing power of Libya up to the declaration of liberation.

The UN General Assembly in September 2011 recognised the ITNC as the legitimate governing authority for the Libyan state. The liberation of Libya was formally announced on October 23, 2011, after the overthrow of the Al-Gaddafi regime. The announcement of liberation mar ed the end of the Libyan people’s armed struggle and the formal start of the country’s transition to a new political order (Blanchard, 2011).

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In November 2011, the ITNC established a transitional government. Afterward, on the 7th February 2012, the ITNC approved the election law and created the Supreme Election Commission (SEC), whose role was to prepare for elections for the General National Conference (GNC), to comprise of 200 elected representatives. On August 8, 2012, the authority of the TNC was transferred to the GNC, which was elected on 7 July 2012 and will continue to manage the general affairs of the country for a year and a half.

4.2.4 Overview of Libya’s economy

4.2.4.1 Libya’s economy before the discovery of crude oil

Before the discovery of significant crude oil reserves in 1959, Libya was one of the poorest countries in the world, with depressing economic prospects (Wright, 1981; World Bank, 2006). During that time, Libya was basically dependent on foreign financial aid, and the country’s economy was based largely on the agriculture sector, which employed more than 70 % of the labour force, contributed about 30 % of the Gross Domestic Product (GDP), and was reliant on climatic conditions (World Bank, 2006). Libyans’ economic conditions before crude oil was discovered in the country was described by Higgins (1968, p. 819), an economist who had worked as consultant to Libyan government since the country gained independence in 1951 as follows:

In 1952 Libya seemed to be an almost hopeless case. Its great merit as a case study is as a prototype of a poor country. We need not to construct abstract models of an economy where the bulk of people live on a subsistence level, where per capita income is well below $50 per year, where there are no sources of power and no mineral resources, where agricultural expansion is severely limited by climatic conditions, where capital formation is zero or less, where there is no skilled labour supply and no indigenous entrepreneurship. When Libya became an independent nation…it fulfils all these conditions. If Libya can be brought to a stage of sustained growth, there is hope for every country in the world.

After Libya gained its independence in 1951, prospects for economic growth were extremely “blea ” and the country’s economy was “deficient” to an extraordinary extent (Bait-EI-mal et al. 1973; Mahmud and Russell, 2003). Difficult economic conditions forced the first Libyan government at the time of its independence to seek foreign financial assistance to finance economic and social development from different United Nations organisations and countries such as the United States, the United Kingdom, and