Libya, a big food buyer, has dismissed as unfounded fears that due to ?growing disarray? in the country, it could delay payments for food shipments.
Since the end of last year's conflict that ousted its former dictator Gaddafi from power after more than four decades of iron-fist rule, Libya has stepped up purchases of staples including wheat and sugar, but because of these fears, traders have been saying that some foreign firms are diverting shipments elsewhere and as such, the country is reported to be paying extra for food imports.
Visitors to Tripoli and other cities are amazed that shops in Libya are opening every day and open markets are as popular as ever, if not more with stalls and shelves displaying a great variety of foreign produce.
Libya is viewed by international traders as a lucrative market, however, some have now been reported saying that they are backing off from trade.
A European grain trader has been quoted saying by Reuters, that Libya has a huge amount of oil wealth, but its chaotic administration and fears about non-payment are still giving it a bad reputation in international trade.
Companies contacted by Reuters could not cite concrete cases of default by Libyan importers, but rather unease that payment could be delayed, not least by cumbersome bureaucracy.
Despite the fact Libya's huge oil wealth should make it a grade one customer to sell to, another European grain trader said that there is an unspoken Libya premium in the grain trade which the country has to pay for grain imports. "Traders need the extra money because of payment risks and the general uncertainty in the pretty chaotic government there."
Libya's main grains buyers are the Matahan agencies in Tripoli and Benghazi, which issue tenders and sell milled goods to the state agency that ensures stable food prices through subsidies.
Libyan officials have denied there are any problems for foreign companies in securing payment, but some recognised an issue with perceptions of Libya after last year's widely publicised conflict.
An unnamed marketing official at Matahan Tripoli said it was more the confidence. ?For the credit there is no problem, the commercial relationship is clear, it's more the confidence," he is quoted saying as he admitted that there are still companies that are afraid about the situation in Libya after last year's events.
The official said some traders were calling for more money, adding that it will improve, and there will be better conditions.
Reuter quoted Matahan Benghazi chairman Suleiman al-Deeb, who took over after the war, saying that the industry met international standards. "Banks guarantee our transactions; when (goods) arrive with the required specifications, the bank will pay the financial value immediately as provided in the issued contracts," he said.
Libya's wheat consumption is estimated to reach 1.65 million tonnes in 2012-13, unchanged from 2011-12 and only slightly down from 1.7 million tonnes in 2010-11, U.S. agriculture department data shows. Almost all of it is imported.
According to ISO data, Libya is also dependent on imports of white sugar, and annual sugar consumption is estimated to have averaged around 230,000 to 235,000 tonnes in recent years
Two separate trade sources said they were aware of some white sugar cargoes being diverted to other destinations in recent weeks due to concerns over getting paid on time.
Libya's subsidizer, the Price Stability Fund - which buys wheat flour, tomato paste, sugar and rice - says it has not issued any international sugar tenders in 2012, but had been buying from Libyan companies following last year's war.
Since the end of last year's conflict that ousted its former dictator Gaddafi from power after more than four decades of iron-fist rule, Libya has stepped up purchases of staples including wheat and sugar, but because of these fears, traders have been saying that some foreign firms are diverting shipments elsewhere and as such, the country is reported to be paying extra for food imports.
Visitors to Tripoli and other cities are amazed that shops in Libya are opening every day and open markets are as popular as ever, if not more with stalls and shelves displaying a great variety of foreign produce.
Libya is viewed by international traders as a lucrative market, however, some have now been reported saying that they are backing off from trade.
A European grain trader has been quoted saying by Reuters, that Libya has a huge amount of oil wealth, but its chaotic administration and fears about non-payment are still giving it a bad reputation in international trade.
Companies contacted by Reuters could not cite concrete cases of default by Libyan importers, but rather unease that payment could be delayed, not least by cumbersome bureaucracy.
Despite the fact Libya's huge oil wealth should make it a grade one customer to sell to, another European grain trader said that there is an unspoken Libya premium in the grain trade which the country has to pay for grain imports. "Traders need the extra money because of payment risks and the general uncertainty in the pretty chaotic government there."
Libya's main grains buyers are the Matahan agencies in Tripoli and Benghazi, which issue tenders and sell milled goods to the state agency that ensures stable food prices through subsidies.
Libyan officials have denied there are any problems for foreign companies in securing payment, but some recognised an issue with perceptions of Libya after last year's widely publicised conflict.
An unnamed marketing official at Matahan Tripoli said it was more the confidence. ?For the credit there is no problem, the commercial relationship is clear, it's more the confidence," he is quoted saying as he admitted that there are still companies that are afraid about the situation in Libya after last year's events.
The official said some traders were calling for more money, adding that it will improve, and there will be better conditions.
Reuter quoted Matahan Benghazi chairman Suleiman al-Deeb, who took over after the war, saying that the industry met international standards. "Banks guarantee our transactions; when (goods) arrive with the required specifications, the bank will pay the financial value immediately as provided in the issued contracts," he said.
Libya's wheat consumption is estimated to reach 1.65 million tonnes in 2012-13, unchanged from 2011-12 and only slightly down from 1.7 million tonnes in 2010-11, U.S. agriculture department data shows. Almost all of it is imported.
According to ISO data, Libya is also dependent on imports of white sugar, and annual sugar consumption is estimated to have averaged around 230,000 to 235,000 tonnes in recent years
Two separate trade sources said they were aware of some white sugar cargoes being diverted to other destinations in recent weeks due to concerns over getting paid on time.
Libya's subsidizer, the Price Stability Fund - which buys wheat flour, tomato paste, sugar and rice - says it has not issued any international sugar tenders in 2012, but had been buying from Libyan companies following last year's war.
