Dubai: UAE-based hotel operator Coral International has tied up with a Libyan firm to manage hotels in Libya ticking off that the North African nation is opening up its tourism sector to foreign players.

The venture formed by Coral and Tripoli-based Winzrik Tourism and Investment Group hopes to manage several government-owned hotels now being offered to private operators as well as open new properties in tourist areas.

"Tourism is a growing business in Libya. The government is now offering many incentives in this sector," Winzrik chairman Abdul Razaq Gherwash told Gulf News yesterday.

His 15-year-old company is already in talks with to secure contracts for two five-star hotels owned by the Libyan government in Tripoli. Discussions are also taking place to manage a big resort in Subrata opening in September.

"Increase in traffic to the country has increased the demand for good hotels and hospitality services in the country," Gherwash said.

Winzrik's plans to invest $25 million in a four-star hotel and another $50 million in a seaside tourist village outside Tripoli.

Besides operating hotels, the companies will have a catering business. For decades, Libya has remained a closed country both for foreign travellers and investors for long, partly due to international sanctions.

But Gherwash believes the government is keen to welcome tourists and has relaxed granting of visas.

"We are focused on attracting quality group tourists, not mass tourism," he added.

Michel P.J. Noblet, managing director of Coral International, said his company has become the first foreign hotel group to form an alliance with a Libyan group. "The country is beginning to achieve its potential as a tourism destination. This gives us an exceptional business opportunity," he said.

With a vast coastline and being home to many archaeological sites, Libya is seen by both Coral and Winzrik officials as holding immense tourism potential.

Faraj Zintani, a Coral official, believes early success in entering Libya's underdeveloped tourism market will give the company a head start.

"We are entering Libya with both advantages and disadvantages of the market. But we are looking for good future," he said.

Several foreign firms, including hotel companies, are trying to enter the Libyan market through local partnerships.

On Wednesday, Sharjah-based Tameer Holding said it had signed a deal with the Libyan government to develop a $20 billion residential and tourism project near Tripoli.

Its partners in the project include Dubai-owned developer Tatweer and the Arab Fund for Economic and Social Development.

The project will be built on an area of 40 square kilometres on the Mediterranean.