Europe and the Libyan Crisis: Fixing a Failed State in the Backyard

Written by | Friday, March 24th, 2017

Libya is slowly sliding into another wave of escalation as the division between the eastern region under General Khalifa Haftar and the rest of the country nominally under the control of an ever-weaker UN-backed government headed by Fayez Serraj is deepening. At the beginning of this month, fighting started in the Oil Crescent, the part of Libya’s central coast through which 60 percent of the country’s oil exports pass. Coupled with renewed fighting in the capital Tripoli and a growing Russian influence and migration crisis, the country has a pressing mix of problems to awaken Western attention.

As a result of the fighting for the control of Libya’s biggest oil terminals, General Haftar managed to seize the oil wealth but the parliament loyal to him, the Tobruk-based House of Representatives, has made it clear that it will no longer share the revenues of the oil sales with the government in Tripoli. However, the UN-resolutions stipulate that Libyan oil can only be sold by the National Oil Company (NOC) based in Tripoli. Trying to market it through other channels, like the parallel NOC based in Benghazi, means incurring international sanctions – and not selling the crude at all. Without oil sales, Libya’s production will fall, knocking down government revenues and therefore accelerating the fiscal collapse of the economy.

The fight over the oil fields has destroyed any meaningful channel of communication between the east and west of the country and at this point, none of the parties can militarily defeat the others but each side thinks it can win and is reluctant to back down. It would therefore be more likely to see a faction deciding to block all exports rather than compromising with its opponents. As such, a political deal that would manage the future institutional asset of the country, bringing all these stakeholders together, could be hard to achieve in the immediate and perhaps even mid-term future. In the meantime, fighting on the ground escalates, which suggests that other matters are taking precedence to a political process.

Therefore, the major international players – the United States, the European Union and regional powers involved in Libya such as Egypt, the UAE, Algeria, Tunisia and Qatar – should push for a de-conflicting mechanism and cooperate with Russia. At the same time, these countries should also urge UN Secretary General Antonio Guterres to overcome the impasse on his Special Representative for Libya created by the US rejection of Salam Fayyad so that the UN can play an active role in setting up a political process.

Furthermore, Europeans and Americans should push Prime Minister Serraj to offer to Eastern Libya a “Libyan Economic Agreement” on how to manage oil wealth in a way that will benefit the Libyan people and stabilize the country. Such an agreement should include a new social contract between the people and the state regarding the distribution of the oil wealth. Moreover, a neutral body should be established so that US and EU sanctions should be issued against those who try to sell oil outside of what the UN mandates.

Finally, the “militia rule” in Tripoli is incompatible with any stabilization effort and poses a threat to any Libyan government while hampering any form of international assistance. Thus, the international community should also push for a Libyan-led agreement to rid the capital at least of heavy weapons and convince the militias to stock them in less densely populated areas.

‘Libya, the Time to Avoid Escalation is Now’ – Commentary by Mattia Toaldo and Karim Mezran – European Council on Foreign Relations (ECFR).

(The Commentary can be downloaded here)


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