The Economist Intelligence Unit's 2010 democracy index ranks Libya 158th out of 167 countries, putting it among the 51 countries categorised as "authoritarian" and making it the third-lowest-ranked country in the Middle East and North Africa after Saudi Arabia and Iran. Libya's score has fallen slightly as civil liberties have been eroded by restrictions on the media and on freedom of association. However, its ranking improves, as it has overtaken Iran, which has seen a particularly severe downgrade in its index score following the controversial election in 2009. Our index also shows a general decline in democracy across the world since the previous index in 2008.

The country's overall score is depressed by the zero score for electoral process, which is a reflection of the lack of national elections and of the concentration of power over the past 40 years in the hands of the Libyan leader, Colonel Muammar Qadhafi. There are thus considerable concerns about the fate of the government after his departure, with no provision as to how a new leader will be selected and no precedent for either an elected head of state or a dynastic succession, with one of Colonel Qadhafi's taking over the leadership. It is uncertain whether this would prove acceptable to the population. A new constitution has been proposed by one of the leader's sons, Saif al-Islam Qadhafi, but little progress appears to have been made on this front and it is unlikely to address such sensitive questions as the leadership.

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The government's legitimacy is personal rather than institutional

At a modest 1.11 out of 10, the score for political participation is higher than that for electoral process because of the jamahiriya (republic of the people) system of government. Under this system, local-level Basic People's Congresses (BPCs) are asked annually to debate and vote on government policy, the outcome of which is then communicated by their delegates to the annual General People's Congress-the closest Libya has to a parliament. Neither has any formal power to block or initiate legislation. Colonel Qadhafi is under no obligation to accede to the consensus of the BPCs or GPC, but doing so allows him to maintain the façade of a popular democracy. For example, Colonel Qadhafi went along with the BPCs when they voted against his Wealth Distribution Programme, which proposed to dismantle central government and distribute oil revenues directly to local administrations.

Economic hardship threatens to foment unrest

Political culture and civil liberties are also suppressed. Expression of dissent is tightly controlled by a pervasive security apparatus and consequent self-censorship, and sporadic outbreaks of popular protest are under-reported by a tightly controlled media, where even private organs are constrained in what they write. The government has taken steps to release members of the Islamist opposition, the only group with the organisation and coherence to command wider public support, and other political prisoners. The steps could be designed to appease supporters of the opposition, but it could also indicate that the opposition has become so weak that it is no longer considered a credible threat by the authorities.

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Democracy index 2010: Democracy in retreat, a free white paper containing the full index and detailed methodology, can be downloaded from www.eiu.com/DemocracyIndex2010.

Note on methodology

There is no consensus on how to measure democracy and definitions of democracy are contested. Having free and fair competitive elections, and satisfying related aspects of political freedom, is the sine qua non of all definitions. However, our index is based on the view that measures of democracy that reflect the state of political freedom and civil liberties are not "thick" enough: they do not encompass sufficiently some crucial features that determine the quality and substance of democracy. Thus, our index also includes measures of political participation, political culture and functioning of government, which are, at best, marginalised by other measures.

Our index of democracy covers 167 countries and territories. The index, on a 0 to 10 scale, is based on the ratings for 60 indicators grouped in five categories: electoral process and pluralism; civil liberties; the functioning of government; political participation; and political culture. The five categories are inter-related and form a coherent conceptual whole. Each category has a rating on a 0 to 10 scale, and the overall index of democracy is the simple average of the five category indices.

The category indices are based on the sum of the indicator scores in the category, converted to a 0 to 10 scale. Adjustments to the category scores are made if countries fall short in the following critical areas for democracy:

• whether national elections are free and fair;
• the security of voters;
• the influence of foreign powers on government; and
• the capability of the civil service to implement policies.

The index values are used to place countries within one of four types of regimes:

• full democracies-scores of 8 to 10;
• flawed democracies-score of 6 to 7.9;
• hybrid regimes-scores of 4 to 5.9;
• authoritarian regimes-scores below 4.