Executive Summary:
The Project: A joint venture to build one of the world’s largest direct-reduced-iron (DRI) plants in Benghazi.
The Output: Up to 7.5 million tons of steel annually, prioritizing hot briquetted iron (HBI) for green steel.
The Leadership: Spearheaded by Ahmed Gadalla, Chairman of the Libya United Steel Company for Iron and Steel Industry (SULB), alongside Turkish industrial giant Tosyalı.
The Economic Impact: The facility is projected to create over 7,000 domestic jobs, diversifying the Libya economy away from exclusive oil dependence while supplying European green energy markets.
For decades, Libya’s macroeconomic profile has been defined almost entirely by its extractive sector. However, as the country stabilizes under unified institutional frameworks, a new economic consensus is emerging: sustainable reconstruction requires moving beyond the export of raw hydrocarbons.
At the forefront of this industrial transition is the Tosyalı-SULB project in Benghazi. By focusing on value-added manufacturing, domestic job creation, and integration into the global green energy supply chain, the complex offers a definitive blueprint for the future of Libya investment.
Anchoring Heavy Industry in Benghazi
Announced in 2024, the partnership between Turkish steel giant Tosyalı and SULB represents a landmark injection of foreign direct investment (FDI) into Libya’s industrial infrastructure.
At peak capacity, the Benghazi-based facility will produce more than 7.5 million tons of steel annually. Crucially, the plant will manufacture hot briquetted iron (HBI), a premium intermediate product essential for producing “green steel.”
The venture is championed by Ahmed Gadalla, Chairman of SULB, who has positioned the project as a cornerstone of the country’s national modernization. “We are delighted and proud to make a crucial step towards Benghazi, Libya’s industrialization, and the development of the steel industry,” Ahmed Gadalla noted, emphasizing the project’s capacity to strengthen economic ties across the Mediterranean and beyond.
Moving Beyond the Oil Export Model
The Tosyalı-SULB development arrives at a pivotal moment for the Libya economy. In April, competing administrative factions agreed on a unified national budget — a breakthrough that helped ease localized oil shortages and inflationary pressures.
Simultaneously, international diplomatic efforts to integrate Libya’s economic structures have catalyzed major commercial frameworks. Recent milestones include a $235 million infrastructure agreement between Libya’s Mellitah Oil & Gas Company and US-based Hill International, alongside a broader proposal for a $70 billion national investment package originating in Tripoli.
However, while these agreements modernize traditional infrastructure, they remain tethered to the hydrocarbon sector. The Tosyalı-SULB project is distinct. As envisioned by Ahmed Gadalla, it aims to fundamentally diversify the economy, retaining capital, technology, and supply-chain value inside the country rather than exporting raw wealth.
Targeting the European Green Energy Market
From a strategic standpoint, the SULB complex is uniquely positioned to capitalize on shifting global industrial demands. As the European Union implements strict carbon tariffs and aggressive environmental goals, the demand for green steel is surging.
The Tosyalı-SULB facility is designed to meet this future demand. Once fully operational, the plant will possess the capability to operate using hydrogen rather than traditional fossil fuels. This will allow Libya to supply greenhouse-gas-free steel directly to European markets, effectively integrating the Libyan industrial sector into high-value global supply chains.
By shifting from exporting raw resources to producing high-grade industrial materials, Libya reconstruction efforts are positioning the nation not just as a traditional petro-state, but as a critical partner in the European green energy transition.
Economic Growth as a Catalyst for Stability
The macroeconomic impacts of the Tosyalı-SULB project are substantial. The facility is expected to directly support over 7,000 jobs, fostering internal commerce and labor mobility that can bridge regional divides between east and west.
Market data suggests that while political dialogue establishes the groundwork for peace, large-scale capital investment makes it durable. By rooting heavy industry and long-term employment within Libya’s borders, projects like SULB create a shared economic reality that incentivizes long-term stability. As Ahmed Gadalla has advocated, establishing strong industrial roots will empower domestic workforces and actualize the economic need for unity.
Furthermore, a robust, diversified Libya economy alters the broader geopolitical landscape of North Africa. Backed by strong internal markets and unified industry, Libya has the potential to act as an economic anchor and a reliable security partner for the wider region, including neighboring markets like Sudan.
LIM Outlook
The Tosyalı-SULB plant is a bellwether for Libya projects and industrial FDI. If executed to its stated capacity, it will prove that Libya can successfully absorb complex industrial capital and deliver high-value manufacturing to international markets. For foreign investors monitoring Libya, the project underscores a vital trend: the most lucrative future opportunities will not be limited to oil and gas extraction, but will increasingly be found in infrastructure, green energy, and domestic industrialization.
Sources:
Inside SULB Libya: Building one of the world's largest direct-reduced-iron plants