Tag Archives: Libya militias

How to Destroy a Country: attack the central bank

Libyan Dinar. image from wikipedia

The United Nations condemned a reported attack on an office of Libya’s central bank in the eastern city of Benghazi, calling for an inquiry into the incident that has complicated talks between the country’s warring parties.,,The incident at the bank, which has tried to stay out of the conflict, weakened the Libyan dinar against the dollar on the parallel market. The bank is controlling the country’s vital oil revenues and foreign currency reserves.“The United Nations Support Mission in Libya condemns the reported armed attack against the Central Bank branch in Benghazi, a sovereign symbol of the Libyan State,” it said in a statement…

A Reuters reporter could see damage to the bank building located in the city center, the scene of heavy battles for weeks between eastern government troops and Islamist fighters…Both conflict parties have been fighting for control of the oil producer and appointed separate heads for the central bank which held $109 billion in foreign reserves at the end of June, the last published figure. Experts believe the figure has fallen due to a slump in oil output.  Oil revenues are booked abroad on accounts of a state bank to which only the central bank has access. About half of the currency reserves are held in illiquid or rather exotic assets such as equity stakes from Italy to Bahrain or Chinese bonds.

Excerpt from U.N. condemns attack on Libyan central bank, demands inquiry, Reuters, Friday, 23 January 2015

The Division of Libya

Libya satellite image

Libya’s self-proclaimed prime minister [Omar al-Hassi] has warned that attempts by a rival government in the east to assert control over the oil industry could escalate the political conflict dividing the OPEC member state and force it to break in two.  Libya has had two governments competing for power since August 2014 when a group called Operation Libya Dawn, which opponents say is backed by Islamists, seized Tripoli and forced the elected Prime Minister Abdullah al-Thinni to flee 1,000 km to a small city near the border with Egypt.

The warning by Omar al-Hassi, prime minister of the rival government, came after Thinni’s government claimed air strikes on Tripoli’s Mitigate airport this week, escalating a confrontation that started with an attack by Libya Dawn on a rival force in Tripoli in July.  The new rulers in the capital are not recognised by the United Nations and world powers but have taken over ministries, oil facilities, airports and much of western and central Libya.

In a step to assert control over the oil industry, Thinni’s government said it had appointed a new chairman of the National Oil Corp. Thinni had initially retained the state oil firm’s previous head, Mustafa Sanallah, but he remains in Tripoli.  The conflict gripping Libya three years after the overthrow of Muammar Gaddafi poses a legal dilemma for oil traders, who are left wondering who owns Libya’s oil exports, worth more that $10 billion a year. The country sits on Africa’s largest oil reserves…

“There are attempts (by Thinni) to set up an eastern Supreme Court, there are attempts to launch a central bank in the east, there are attempts to establish a separate oil ministry in the east,” said Hassi, who said he was against partition.

Thinni’s government has sought to move heads of state-run institutions to the east as he is recognised by the international community, but he too denies any plans for secession.

But Hassi said Thinni’s government had shown it intended to control oil facilities in the eastern rump state by picking al-Mabrook Bou Seif as new NOC Chairman, since he was from the same tribe as Ibrahim Jathran, a former rebel leader who seized eastern ports for a year to press for regional autonomy.

Struggle over Libya’s oil risks breaking up country -rival PM, Reuters,  Nov. 28, 2014

Where is the Central Bank of Libya?

Central_Bank_of_Libya, photo 2010 from wikipedia

Libyans have become accustomed to chaos in a country flooded with weaponry where militias and tribes call the shots, two years after NATO bombing helped rebels topple Muammar Gaddafi.But the daylight robbery of $55 million from a Central Bank van suggested that Prime Minister Ali Zeidan’s cabinet is losing the struggle to provide security and build state institutions.Ten gunmen intercepted the van when it left the airport in Sirte, a former Gaddafi stronghold, snatching the cash flown in from Tripoli for the local central bank branch…

Sirte, a central coastal town near Gaddafi’s birthplace, has escaped the violence rife in cities such as Benghazi in the east, where assassinations and bombings are part of daily life. But the city showcases the lawlessness engulfing postwar Libya after four decades of Gaddafi’s quirky one-man rule.The fledgling army has largely moved out of Sirte, unable to rein in armed bands or the Islamist militants of Ansar al-Sharia which runs training camps nearby, residents say.

Unable to impose security here and in other cities, the government has co-opted former anti-Gaddafi rebels, putting them on the state payroll to guard public buildings or man checkpoints, nominally as part of state security forces.In fact these gunmen report to their own commanders who have their own agendas. Some are close to Islamists like those who briefly grabbed Zeidan from his Tripoli hotel room this month in protest at a U.S. raid to seize an al Qaeda suspect.Other militias pursue tribal interests or smuggle weapons, drugs and anything else that makes money…

[I]nsecurity in the streets is exacerbated by infighting between supporters of Zeidan, a liberal, and his Islamist opponents in the General National Congress, or parliament. “The government is very weak compared with other political forces, criminals and terrorists,” said Libyan political analyst Rami Mussa.

Exploiting the power vacuum, protesters have shut down oil terminals and oilfields around the country. Oil output, the main source for the budget, is down to a fraction of the 1.6 million barrels a day Libya pumped before the uprising against Gaddafi…In the east, disfavored in Gaddafi’s time, tribes and other armed groups demand autonomy and oil wealth. Regional councils have sprung up which want to sell crude bypassing Tripoli.

Excerpt, Central Bank falls victim to Libya’s rampant crime, anarchy, Reuters, Oct. 29, 2013