The Impact of Oil Rent Dependence on Food Security in Libya: A Structural Analysis

Abstract

Libya’s experience with food security offers a telling example of how resource wealth can paradoxically undermine basic welfare outcomes. Despite more than six decades of oil revenues, the country remains heavily dependent on food imports, with local agriculture covering no more than a tenth of domestic consumption. This paper argues that this is not a temporary condition or a policy failure that can be fixed by better planning. Rather, it reflects a structural feature of the rentier economic model that Libya has followed since the 1960s. The analysis draws on three interrelated mechanisms: the displacement of agricultural investment by oil-related spending, the direct transmission of oil price fluctuations into food import costs, and the gradual erosion of institutional capacity for managing food security. The study concludes that without a fundamental shift away from oil dependence, food security will remain precarious regardless of short-term policy measures.