CurrenT aFFairs

New hurdles hamper Libya’s rehabilitation Libya’s president, Colonel Muammar Gaddafi, was a global pariah when Saddam Hussein was still the West’s best friend. But how times change. Between Saddam Hussein being captured, tried and hanged, the Libyan president had remodelled himself and his country to emerge as shining examples of total rehabilitation in the eyes of the world. Richard Seymour reports.

14 The Middle easT June 2008 It is not quite 20 years since Pan Am flight 103 exploded over the Scottish town of Lockerbie, killing 270 people on board and on the ground. Libya has since been linked with the atrocity – its full role still not fully established in a case that is, even after all this time, ongoing – and its status as a sponsor of international terrorism earned it a place on Washington’s list of persona non grata states. All economic and political ties with the West were severed and sanctions put in place. So what has changed? In 2003, Gaddafi announced an end to his country’s nuclear weapons programme and invited inspectors into Libya. George Bush and Tony Blair were quick to grab the glory, claiming Colonel Gaddafi would never have opened his country up in such a way had it not been for their actions in invading Iraq and deposing its leader. They largely overlooked the remarkable contribution of Nelson Mandela and his negotiators, whose reputation – agreeable to all sides – brokered, against the odds, a deal that satisfied Libya, the US and Britain and marked the beginning of Libya’s reintroduction into the international community. In the next few years, sanctions were lifted, political ties re-established, and the business world began to court the North African country for its vast reserves of oil and gas. But have all past sins been absolved? Those with hundreds of millions

The current impasse is holding up US-Libyan relations, but other countries are almost unseemly in their haste to snatch the initiative. Hundreds of European companies had lined up to secure deals

of dollars to make would certainly like to think so, but not everyone is so willing. In January of this year, the US Congress passed a law which meant victims of statesponsored terrorism would be able to claim compensation. This would be achieved by the seizing of assets held by the guilty state in the US, or even money made from deals with those states that are held by Americanbased companies. And while the Libyan government has now denounced terrorism, it has been linked with a number of terrorist acts against US citizens, including the bombing of Pan Am flight 103. Victims of some of those acts are still waiting for the outcome of court cases, which, if the courts find against Libya, could cost that country several billions of dollars; and the new law has made it easier for them to claim what they are owed. Already, more than a dozen US companies have had suits filed against them. This has made it very dif ficult for American companies to do business with Libya, and the concern is that other companies, based in other countries, will take advantage and gain a foothold in North Africa ahead of them. As a result, members of President Bush’s cabinet, among them Secretary of State Condoleezza Rice and Defence Secretary Robert Gates, have written to Congress to ask that Libya be made exempt from the law. Backed by some very rich and powerful representatives of the oil companies, the Libyan government has acquired the services of an influential lobby group to argue their case on their behalf. Senator Frank Lautenberg, who was behind the provision for the claiming of assets, is determined not to give in to the pressure. Already, he has been willing to concede that Iraq should be made exempt, as any multibillion dollar compensation claim would further hinder an already rocky road to recovery. But on the issue of Libya he is standing firm.

(l) russian president putin visits Tripoli. (r) bush and blair are both aware of the investment and oil opportunities in libya under gaddafi’s (far left) more relaxed policies

“This new law achieves my goal of providing justice for American victims of terrorism at the hands of terrorist states like Iran and Libya. I will not rest until all American victims of terrorism get the justice they deserve,” he said when the bill was first passed. This is a tightrope for the Bush administration; while it wants to be seen as uncompromising on the purveyors of terrorism and unwavering in its support for US victims of terrorist attacks, it appears reluctant to follow through at the risk of damage to the long-term financial interests of the United States and US-based companies. This stance is entirely at odds with Washington’s more vocal and aggressive attitude toward Iran. The current impasse is holding up USLibyan relations, but other countries are almost unseemly in their haste to snatch the initiative. Hundreds of European companies had lined up to secure deals even before the sanctions were lifted. The years of crippling sanctions have left Libya with an aged infrastructure and the opportunity to make money from development alone makes the country extremely attractive to overseas investors keen to climb on board before the ladder is drawn up. Chief among those opportunities is the development of Libya’s oil and gas reserves, which British oil giant, Shell, wasted no time in staking a claim on. Also among the early runners for a share of the new market was British defence and aerospace company, BAE. There are continuing concerns that the rush to agree lucrative contracts may encourage western governments and businesses to overlook aspects of Libya’s human rights record that many still have anxieties about.

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