Controversial appointments sow further division in Libya

The economic system in Libya remains the same centralised, state-controlled model that was created by the Qaddafi regime to prevent private business from freely functioning or growing.
Sunday 14/10/2018
Bumpy road. Head of Libyan Presidency Council Fayez al-Sarraj (R) speaks during a news conference with UN Envoy to Libya Ghassan Salame in Tripoli. 				                             (Reuters)
Bumpy road. Head of Libyan Presidency Council Fayez al-Sarraj (R) speaks during a news conference with UN Envoy to Libya Ghassan Salame in Tripoli. (Reuters)

TUNIS - Libya’s Presidency Council decided it had to make fundamental changes if it were to survive after the military crisis in Tripoli brought about when an alliance of forces from outside the capital tried to take control.

The council’s first change would be to meet the demand of the main attacking force that Tripoli’s corrupt militias be stripped of power and a new security system installed. The second move involves economic reform, which no Libyan administration since the 2011 revolution has wanted to address.

The economic system in Libya remains the same centralised, state-controlled model that was created by the Qaddafi regime to prevent private business from freely functioning or growing. Its continuation has blocked the creation of new businesses that could provide jobs for men who have little alternative but to remain in the militias.

Both objectives have been heavily urged on Presidency Council head Fayez al-Sarraj by UN Special Envoy to Libya Ghassan Salame

As initial steps, a joint force from Misrata and Zintan was securing the capital and the currency was being effectively devalued with a 183% surcharge on foreign currency purchases.

The establishment of the joint force was put in limbo when the threat of clashes in the city was resolved by a ceasefire. On the surcharge issue, the central bank is building on it by issuing letters of credit at the new rate.

Sarraj followed the moves with a cabinet reshuffle. He named a new interior minister to get to grips with security in Tripoli and new economy and finance ministers to devise and implement economic reforms. The appointments have provoked considerable criticism, even outrage, especially in eastern Libya.

They were condemned as either having been forced on Sarraj or as an attempt by him to retain the support of Misrata and the Muslim Brotherhood for his beleaguered government.

The new interior minister, Fathi Bashagha, is from Misrata and the new economy minister, Ali Issawi, is a member of the Muslim Brotherhood.

Issawi’s appointment was particularly controversial. Not only is he accused of having been incompetent when he served as economic minister under Muammar Qaddafi from 2006-09, he is a prime suspect in the July 2011 killing of Abdul Fattah Younis, the chief of staff of the National Transitional Council.

As such, the appointments, especially Issawi’s, do little for national reconciliation. In the east, the influential Obeidat tribe, of which Younis was a member, demanded that Salame force Sarraj to remove Issawi and that the latter’s innocence be proven before he takes up the post. There is little chance of that happening.

The divisions have been deepened by a sense among those opposed to the Presidency Council that Sarraj, in going ahead with Issawi’s appointment while aware of the allegations against him, has demonstrated decisively that he does not care about what those in the east and others elsewhere in the country think about the matter.

Others opposed to the Presidency Council claim Sarraj was forced by the Muslim Brotherhood to accept the appointment.

The response to Bashagha’s appointment was less critical. The main argument against him, again from the east, is that he supported the Libya Dawn regime, which in 2014 forced the government of Abdullah al-Thani to flee to the east to Bayda.

Bashagha, however, is seen as someone who can prevent fighting again breaking out in Tripoli and ensure the Presidency Council survives.

The forces of radical Misratan commander Salah Badi that took part in September’s clashes in southern Tripoli remain in the area. There have been reports they have been reinforced from Misrata ahead of a new offensive.

Bashagha, who was a spokesman for Misrata military council during the 2011 uprising, is seen as having the influence and power to prevent this from happening.

For him, the decision to accept the job of interior minister is something of a turnaround. In 2015, he was invited to join the United Nations’ Libya Dialogue team. At the end that year, he was offered the post of national security adviser for the new Presidency Council by the then-UN Special Envoy Bernardino Leon. He declined.

The post of interior minister, which Bashagha has accepted, effectively overlaps with the job he previously refused. The difference now is that the Presidency Council, which he has supported since it was unveiled, could collapse. It is generally accepted that if it were forced out of the capital, it would be finished.

Sarraj, with Salame supporting him, envisions the appointments of Bashagha and Issawi, along with Faraj Bumatari as finance minister, creating stability in Tripoli and allowing economic reforms. The hope is that the reforms will prevent militiamen from milking the system, as happens now, and enable them to find other means of employment.

The reform plans have got off to a bumpy start, however. As far as the letters of credit go, some companies are getting them, others say they are not. The discrepancy is blamed in part on poor administration in some of the banks. As a result, the black market flourishes. There are three rates of exchange for the Libyan dinar: an official rate, a surcharged rate and a black market rate, which most people have to use.

Members of Tripoli militias, though, appear to have no problem in getting foreign currency — and at the official rate, with no surcharge.

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