With Qaddafi dead, Libya must repay its backers with a 'peace dividend,' not favors
Now that Qaddafi is dead and Sirte is captured, Libyans can repay those countries who helped in his ouster not through kickbacks or development contracts, but by establishing a stable, democratic, economically open future for Libya. That's the real 'peace dividend.'
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Economically, Libya boasts a stable currency, net foreign assets of over $150 billion, and is well-positioned to return to a perpetual budget surplus with the eventual full resumption of oil production. Libya, under a well-administered technocratic government committed to a market economy, is a foreign investor’s dream. Its strong macroeconomic prospects emanate from its small population, large virgin land area, strategic location, and potential to produce far more than its pre-revolution 1.7 million barrels of oil per day.Skip to next paragraph
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Libya also confronts immediate pressure to invest in its huge underemployed youth population. Specifically, Libya has development deficits in almost every sector, including oil refining, infrastructure, transport, education, and health. Put simply, there will be plenty of business opportunities for all qualified nations as Libya begins its long overdue development drive. NTC Prime Minister Mahmoud Jibril has cavalierly spoken of $450 billion in project spending over the next decade.
The world will benefit far more if Libya’s leadership decides to award these contracts on a meritocratic basis promoting innovation and efficiency, rather than by venally rewarding those countries that assisted it during the revolution. Sadly, some Western political leaders are already harming Libya’s transition to democracy and their national interests via their misunderstanding of the principle of the “peace dividend.”
French Foreign Minister Alain Juppe told Germany's RTL radio on Sept. 1 that it would be “fair and logical” for French companies to benefit from France’s prominent role in backing the rebels. Similarly, on Aug. 22 – the very day that Tripoli fell – Foreign Minister Franco Frattini of Italy crassly stated on RAI television that the Italian oil company Eni “will play a No. 1 role in the future” of Libya as a result of Italian support of the NATO campaign. These statements – and the political pressure that no doubt lies behind them – undermine Libyan attempts to defeat the endemic culture of corruption that characterized the Qaddafi era.
Now that Libya is officially “liberated” and US Secretary of State Hillary Clinton has returned from a well-timed visit to Tripoli, officials of the State Department will no doubt attend briefings about how to reap the strategic dividends of America’s intervention. They must resist the temptation to publically, or even privately, ask the Libyans for payback in the form of preferential contracts. Surely no amount of oil, construction, infrastructure, or defense contracts can be better than a strong, moderate, and stable Libya that learns to select its business partners based on their merits rather than their nationality.
We believe the alliance powers should not ask the NTC to prostitute Libya’s vast treasure. Doing so would only cheapen the tremendous value of what the NATO alliance has done for Libya. The only true way the Libyans can repay the rest of the world for liberating them from Qaddafi is not through kickbacks, but by making the tough choices required to lay the foundation of a democratic, meritocratic, and economically open future.
Jason Pack researches Libyan history at Cambridge University. He is president of Libya-Analysis.com. Sami Zaptia lives in Tripoli and is CEO of KnowLibya.