BEIRUT: Libya’s recent decision to lift its economic embargo on Lebanon will boost bilateral trade and open up opportunities for businesses in Libya’s reconstruction and energy sectors, experts said. A statement issued by the newly appointed Libyan Cabinet announced the decision earlier this week. The Cabinet has also lifted a similar trade embargo on Switzerland.

“We have taken the decision to cancel the embargo to foster mutual respect and to sustain the economic interests of Libya as well as Lebanon and Switzerland,” Libyan Undersecretary for Economy Ahmad al-Kouchli was quoted as saying by the Libyan News Agency in a statement issued Monday.

The embargo had prevented Lebanese and Libyan companies from engaging in trade. It had also prevented the registration of Lebanese firms in Libya.

Jacques Sarraf, a leading industrialist, told The Daily Star that the new decision would pave the ground for businesses to benefit from a major North African market.

“The reconstruction and energy sectors in Libya will probably see key developments. The decision is likely to allow Lebanese companies, many of which have significant expertise in these fields, to benefit greatly from measure,” he said.

Economist Louis Hobeika echoed Sarraf’s views, saying the decision, coupled with ongoing economic liberalization of Libya, will present great opportunities for Lebanese companies.

“We will have a great boom in Libya mirroring the boom in Saudi Arabia during the 1970s. This will translate to business opportunities, fostered Lebanese exports to Libya and of course the creation of high-paying job opportunities for thousands of Lebanese,” he said.

While Hobeika thought major reconstruction and oil contracts would be granted to multinational corporations, Lebanese companies could benefit greatly from subcontracting.

“These [multinational] companies would subcontract many of their operations and, given the language edge and expertise in Arab countries, Lebanese corporations would probably make good profits on investment in Libya.”

When asked if Lebanon had any significant trade with Libya during the embargo, Hobeika said the volume of trade between the two countries had been limited to minor triangular trade channeled through Egypt and Tunisia.

Meanwhile, Sarraf pointed out businesses should keep in mind that the security situation in Libya remains shaky and infrastructure remains a barrier, especially given the destruction caused during the Libyan revolution.

“These two issues could present a barrier to making big investments in Libya,” he said.

But Sarraf called on businesspersons and the government alike to prepare for a Libya delegation aiming to boost economic ties and open up opportunities for Lebanese companies.

Libyan-Lebanese ties had deteriorated under slain Libyan leader Moammar Gadhafi, who many Lebanese accuse of being behind the 1978 disappearance of influential Shiite cleric Imam Musa al-Sadr in Libya.

Libya closed its embassy in Beirut in 2000 after Parliament Speaker Nabih Berri, head of Sadr’s Amal movement, lashed out at the Libyan regime for kidnapping Sadr.

Lebanon’s Judicial Council implicated Gadhafi and 16 of his aides in Sadr’s disappearance in 2009 and issued arrest warrants against them, further worsening ties between the two countries.

Foreign Minister Adnan Mansour is scheduled to visit Libya Jan. 10 to hold talks with various officials on the disappearance of Sadr as well as advancing bilateral relations.