Showing posts with label Libya Central Bank. Show all posts
Showing posts with label Libya Central Bank. Show all posts

Thursday, June 2, 2016

Disagreements in Libya over competing bank notes from rival central banks

There have been angry protests in Tripoli Wednesday over the lack of cash available at banks.

There are long lineups at banks waiting to withdraw cash. The UN-backed Government of National Accord(GNA) and the Tripoli-based Central Bank of Libya(CBL) are having new banknotes produced by De LaRue in the UK.

The rival eastern-based Central Bank is having new notes issued printed in Russia for the Tobruk-based House of Representatives (HoR). The notes have arrived and distribution began today. The eastern bank notes have different security features, watermarks, and serial numbers.

At first, the Presidential Council(PC) of the GNA claimed the eastern notes were counterfeit a position immediately supported by the US embassy.

However, the PC has since reversed its policy after meeting with representatives of the rival CBL and accepted the notes. It sees them as a way to help the cash shortage that is causing the GNA to lose support. However, the head of the Tripoli-based CBL has rejected the bills. As a recent tweet put it: ​"#Libya Eastern central bank currency distributed today. UN-backed govt says it is national currency but Tripoli central bank says it is not."

It is not clear whether the eastern notes will also be distributed in the western areas under control of the GNA. The confusion can only bring the UN-backed GNA into greater disrepute.

The GNA is supposed to begin its term only after a formal vote of confidence from the HoR. Meetings to have the vote have been either without a quorum or disrupted. The GNA has activated itself anyway with the support of the UN and the international community.

The UN and most of the international community recognize only the GNA and the Tripoli-based LCB but the HoR refuses to recognize the GNA until it votes confidence in it. The HoR has its own central bank and national oil company. The HoR is very much under the control of General Khalifa Haftar a former CIA operative who is commander in chief of the Libyan National Army.

He does not recognize the GNA.

​Since May 2014 his Operation Dignity has been attempting to clear Libya of Islamists which would also include some associated with the GNA.

Sources:
http://kenthink7.blogspot.ca/2016/05/rival-libyan-central-banks-print.html
http://kenthink7.blogspot.ca/2016/05/presidency-council-of-libyan-unity.html
https://www.libyangazette.net/2016/05/29/presidential-council-accepts-eastern-banks-new-banknotes/
https://twitter.com/LibyaschannelEN/status/738002546619482112?lang=en
​https://twitter.com/reportingLibya/status/737972881133568001?lang=en

Monday, April 13, 2015

Internationally recognized Libyan government tries to destroy two main unifying institutions

The internationally recognized Libyan government of Prime Minister Abdullah al-Thinni has once again tried to dismiss the Central Bank of Libya Governor Saddek Elkaber.
Ostensibly, the Board of Management of the Bank, located in Al-Beida in the east, part of the Tobruk-based government, dismissed Elkbaber. This is the board representing the House of Representatvies(HoR) in Tobruk. However, the historic headquarters of the Bank is in Tripoli and Elkaber has continued to operate from there. The Bank has tried to remain neutral in the dispute about the legitimacy of the two rival governments. The rival National Salvation Government is based in Tripoli and was created by the General National Congress. Back in November 2014, the Libyan Supreme Court ruled that the June elections last year were unconstitutional and the HoR should be dissolved. The international community has mostly ignored the ruling. The UN said that it was studying the ruling last November. It has not said a word about it since. However, it has adopted language at times that suggests it is neutral with respect to the legitimacy of the rival governments. The UN has been attempting to negotiate the formation of a unity government and a ceasefire between rival military groups.This move by the Al-Thinni government will make the situation in Libya much more complicated and increase the conflict. The Bank has been paying government salaries of both parties and retained a financial unity within the country in spite of the conflict and two governments competing for legitimacy.
The other main institution that has kept some semblance of unity within Libya is the National Oil Corporation(NOC) that markets LIbyan oil. It has deposited funds from the sale of oil into the Central Bank. The NOC has remained neutral in the dispute as well, depositing money both of sales from Tripoli-controlled ports along with those from the Tobruk-government-controlled ports into the Central Bank. The Tobruk government has now announced that it has created its own National Oil Company based in Benghazi. Just recently it ordered the new company to begin exporting crude, and to open a bank account in the UAE and set up offices in the UK, Germany, and the US. The chair of the new firm, Mabrouk Seif, claims that it had already begun negotiating with firms that have contracts with the rival. However, many experts have their doubts about the new move. Even an economics professor in Benghazi, Ibrahim Suleiman, said:"Foreign oil companies have dealt with NOC in Tripoli for decades. They won't switch their business now. The government has no other choice but to accept the status quo."
Forces loyal to the Tobruk government control the two main oil ports in the east of Es Sider and Ras Lanuf. Just recently, forces of the rival Tripoli government agreed to withdraw from the area, a move praised by the United Nations. Ironically, about a year ago while a GNC transitional government was in power, the same forces tried to ship crude independently of the NOC. A tanker, the Morning Glory escaped Libyan naval units but was ultimately boarded by US special forces and returned to the central government. Now of course these forces who held up production for almost a year, are the good guys allied to the internationally recognized Libyan government. Al Thinni the Tobruk HoR prime minister also made former failed coup leader CIA-linked "renegade" general Khalifa Haftar commander of his armed forces. At the time of Haftar's failed coup Al-Thinni was prime minister of the interim GNC government. The rival forces may decide to renew their attempts to take Ras Lanuf and Es Sider given these new moves by the Al-Thinni government. The moves will no doubt doom any chance for success of the UN-brokered attempts to form a unity government.


Tuesday, January 27, 2015

CIA-linked General Haftar seizes Benghazi branch of Libyan Central Bank

The UN yesterday condemned an attack on the office of the Libyan Central Bank in the city of Benghazi in the east of Libya. The attack appears to have been carried out by forces loyal to CIA-linked general Khalifa Haftar. The Libyan central bank has attempted to remain neutral in the conflict between militias and two rival government. The internationally recognized government is in Tobruk, led by Prime Minister Abdullah al-Thinni. The rival government that controls much of the western part of Libya is in the capital Tripoli and led by Prime Minister Omar al-Hasi appointed by the General National Council. The neutral role of the bank is crucial in maintaining whatever unity is left in the country: "It has continued to pay for fuel and food subsidies as well as the salaries of bureaucrats, doctors, teachers, local officials and millions of other public employees — often regardless of whether they showed up for work. By financing the budgets of the Interior and Defense Ministries, the same bank has even provided salaries and supplies for thousands of fighters battling one another from all sides of the struggle. But its continued distribution of paychecks and subsidies has helped communities and families across the country stay afloat despite the collapse of most other economic activity, even maintaining a semblance of order." Up until now both the headquarters in Tripoli and the branch in Benghazi have been under the control of the Tripoli government.

Benghazi was until recently controlled by the Shura Council of Benghazi Revolutionaries that includes the radical group Ansar al-Sharia. The leader of that group recently died of wounds incurred in battling against CIA-linked Khalifa Haftar's militia. Haftar's forces are responsible for the attack on the bank. A New York Times article put the challenge to the bank in frank terms:" Its most direct challenge has come from the Tobruk-Bayda government. It includes a recently elected Parliament, but it is under the de facto control of Gen. Khalifa Hifter, who defected from Colonel Qaddafi’s military and last year announced a military takeover pledging to rid the country of violent extremists."

The chairman of the National Bank, Sadik el-Kaber, a veteran banker has pleaded with both sides to respect the neutrality of the bank, but the Tobruk government has sought to replace him ever since last October so that they would be able to control the assets. El-Kaber has kept the bank's assets in Tripoli and has refused to resign. In spite of the fact that the Tobruk government is the recognized government El-Kaber still appears to have the support of at least some western governments including the US and the UK. Last month he flew to Washington where he met with US and UK diplomats and officials from the White House and Treasury Dept.The Tobruk-appointed manager also visited this month but was not accorded the same status according to a New York Times article.

The storming of the Benghazi bank has already resulted in the withdrawal of the Tripoli government from a second round of talks that should take place soon. While neither the government at Tripoli nor the main militia, Libya Dawn, took part in the first round, the militia had announced a ceasefire, and the government had agreed to attend the second round of talks if they were held in Libya and not Switzerland. A spokesperson for General Haftar, Mohamed Hejazi, confirmed that they had taken control of the bank and also now control of 80 percent of the Benghazi seaport. He refers to Haftar's forces as "the national army of Libya" and his opponents in Benghazi "terrorists". Benghazi had been ruled by the Shura Council of Benghazi Revolutionaries but Haftar launched an offensive to retake the city some time ago.

After the meetings in Geneva, the main Tripoli militia announced a cease fire. A couple of days later, the Tobruk government also announced a ceasefire. However, there was a caveat to the effect that terrorists would still be pursued. There has been no let up in the attacks by Haftar in Benghazi since he considers his opponents terrorists. However, Haftar considers all his Islamist opponents terrorists. Haftar appears to be using the ceasefire as an opportunity to concentrate on taking control of Benghazi while not having to worry about a battle on other fronts. It remains to be seen if Libya Dawn will allow him to continue in this manner. In any event, it would seem that Haftar has managed not only to sabotage planned peace talks but also to threaten to destroy a key remaining Libyan institution that has kept Libya running through all the conflict. Since the main branch is in Tripoli, his action may cause the Tripoli government to cease control there.

Egypt and no doubt many western countries support Haftar and his campaign against Islamists, but perhaps there may be considerable doubts about the wisdom of his actions. Haftar through his Operation Dignity and his earlier ineffective attempt to dissolve the General National Council last year was in large part responsible for the present conflict. Operation Dignity was launched in May of last year with an attack on two Islamist militia bases in Benghazi and then an attack on the parliament which was ransacked and burned. Below is a video about the start of Operation Dignity: The present prime minister of the Tobruk government, Abdullah al-Thinni was then prime minister of the GNC government. He declared Haftar's action illegal and a coup attempt. Now the same Abdullah Al-Thinni is prime minister of the Tobruk government. On November 6, last year the Libyan Supreme Court ruled that the elections in June of last year were unconstitutional and that the Tobruk House of Representatives should be dissolved. Al-Thinni and the Tobruk government rejected the ruling. The international community has studiously ignored it. This is one more key Libyan institution simply ignored by the Tobruk government.

Al Thinni applauded the court when it decided that a rival prime minister appointed by the GNC by Islamists was ruled not to have been duly appointed leaving al-Thinni as the caretaker prime minister. The Islamist-supported candidate in that case accepted the ruling.

A commander of Haftar's forces, Col. Farraj al-Barasi. told Reuters that the forces were forming a committee to decide what to do with the money from the bank: “We’ve moved out the technical equipment.The cash is still in the safes.” This strikes me as bizarre. What government would allow their armed forces to make such a decision. Yet the Tobruk government expresses full confidence in Haftar: "The commander of the Libyan National Army, Gen. Khalifa Haftar, is operating on the authority of the internationally recognized Libyan government based out of Tobruk, Libyan authorities confirmed this week. " If that is true, then the UN and the international community should be taking action against that government. Not only are they sabotaging a cease fire but they are also sabotaging peace talks, and exacerbating the situation by seizing the assets of the Libyan Central Bank whose neutrality has been crucial to what unity and stability still exists in Libya.

While the UN has threatened sanctions against any party that blocks the transition to democracy in Libya it is unlikely any action will be taken against the Tobruk government or Haftar. Haftar is the champion of the fight against terrorism as is his mentor next door in Egypt, Prime Minister el-Sisi. Rather than being subject to sanctions he is likely to receive even more support. This is a recipe for more civil war not peace.

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