U.N. lifts Libya sanctions

Libya

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Last Friday, the UN Security Council voted to remove sanctions it imposed against the Libyan Central Bank and against the Libyan Foreign Bank, a Central Bank-owned offshore institution, in support of the protests against Col. Muammar Gadhafi.  The value of frozen Libyan assets is estimated at $150 billion.  Previously only $18 billion had been released, of which only $3 billion was made available to Tripoli.  The assets are needed to pay government employees and to rebuild state institutions.

In September, the UN removed sanctions on the national oil company, considered a necessary element of the reconstruction.  However, the unfreezing of Central Bank assets was delayed, partly due to legal difficulties in ensuring that the assets did not belong to Gadhafi, his relatives, or members of his government.   Sanctions still apply to those personal assets.  The Central Bank assets were released after officials in the new Libyan government sent a request to the UN, saying that it was, “essential for the economic stability of Libya; for confidence in the banking sector; for the smooth execution and settlement of both domestic and international banking transactions; and to underpin the social and microeconomic stability of the new Libya.”

Shortly after the UN decision on Friday, the US Treasury Department announced that it had unfrozen $30 billion in Libyan government assets.  The following day, US Defense Secretary Leon Panetta arrived in Libya to express support for the post-revolutionary government.  UK Foreign Secretary William Hague announced on Saturday his nation’s intention to release £6.5 billion ($10 billion) in assets to Libya and to work with other European nations to further remove the sanctions.  He called on the new government, “To build a transparent and accountable financial system that will underpin a newly prosperous Libya.”

Although Libya can generate revenues from its oil exports, production was hurt during the rebellion, leaving current revenues insufficient for the government to operate.  The UN sanctions ended as part of a procedure whereby they automatically expired after council members did not submit objections to their non-continuance. (Source: english.nuqudy.com)