People-smuggling in Libya is now a major part of the economy worth hundreds of millions of dinars according to the EU.
In the report by the European Union Naval Mediterranean Force, Rear Admiral Enrico Credendino warned the 28 member states that Libya's economy is benefitting from an estimated $300 million per annum in human trafficking.
Reporting on the EU Navy's performance during the first ten months of 2016, Credendino warned how the human trafficking trade is now increasingly being used by "Islamic extremists".
"Al-Qaeda and AQIM (Al-Qaeda in the Islamic Maghreb), aligned with the Tuareg tribe in southwestern Libya, are assessed to be financially exploiting these smuggling routes," Credendino warned.
Traffickers have been charging around $1,000 for every person wishing to travel by sea to Europe which has been some 350,000 migrants this year with 4,690 dying en route.
Amnesty International has accused people smugglers of engaging in numerous murders, sexual violence, torture and religious persecution.
In a bid to curb the risks, the navy will need to regularly monitor the waters within Libyan territorial waters but this will not be the case anytime soon.
"It is clear that the legal and political pre-conditions have not been met," Credendino explained, citing how greater cooperation with the Libyan authorities was needed to initiate this.
For the EU naval vessels to operate in Libyan waters, permission from the Libyan government, the Presidency Council, and a vote in favour by the UN Security Council is needed.
Earlier this year, Libyan coastguard members were accused of using excessive force when boarding a rubber dinghy that 20 migrants drowned from. The charity Sea Watch claimed that the migrants died after a Libyan coastguard attacked one of its rescue operations when the boat was in distress, which the Libyan navy subsequently denied.