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Key Economic Data 
 
  2003 2002 2001 Ranking(2003)
GDP
Millions of US $ 19,131     71
     
GNI per capita
 US $ n/a n/a
Ranking is given out of 208 nations - (data from the World Bank)

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Update No: 073 - (21/12/09)

Despite Diplomatic Turnaround Libya Remains an Enigma
"We tell them that the minaret is at the heart of the mosque," he said. "How can we tell a mosque from any other place if we did not see the minaret?"

“Muslims are not trying to take over Switzerland”. "We do not wish for Switzerland to be a Muslim country, so that they would not go to heaven and would not receive God's mercy…We would want them to remain pagan." (Mu’ammar al-Qadhafi, responding to Switzerland’s referendum results, banning the construction of minarets.)
Relations between Libya and Switzerland have deteriorated sharply since July 2008, when the Swiss police detained Hannibal al-Qadhafi, the Libyan leader’s son, for physically attacking one of his domestic servants during a trip to Switzerland. Although the episode was one of a series of dubious distinctions collected by Hannibal, the Libyan leadership has been feeling buoyant with pride and self-satisfaction at having secured important diplomatic and business relations with the United States and all the major world powers. Swiss citizens Max Goeldi and Rachid Hamdani were arrested in Tripoli, two days after Hannibal and his wife were released from two days of custody in Geneva police station after being charged with beating their servants. The two men have been prevented from leaving Libya since then, charged with unspecified immigration and tax evasion crimes; they have found refuge in the Swiss Embassy. The two businessmen were tried in absentia, with no lawyers or foreign media in the court. They therefore face the prospect of arrest, as they must attend their appeal trial on December 22. Switzerland’s president Merz personally flew to Tripoli days before the grandiose 40th anniversary of the Libyan Revolution celebrations were to begin and in the wake of the domestic political triumph that was the release of the Abdul Baset Ali al-Megrahi, the sole convict for the Lockerbie bombing. Merz apologized profusely, but Libyan authorities have not responded in kind.

Mu’ammar al-Qadhafi expects to be treated like an important political leader, and Libya as an important power, wherever he travels and any measures taken against highly visible Libyan citizens or interests are considered an affront on the country’s dignity and honor. Libya’s handling of the ‘Hannibal in Switzerland’ episode serves as a clear warning of what can still happen in Libya to the citizens of countries which ‘challenge’ the regime. Libya’s abundant hydrocarbon resources, of course, are the buttress that allows the regime to act in this way. The optimism that had been building since late 2003, when Libya adopted a far more pragmatic foreign policy aimed at attracting foreign investment to help further develop its oil industry and diversify the economy, has been blemished by the ‘Swiss’ incident. Indeed, the incident adds some credit or foresight to the way the Scottish government handled the compassionate release of al-Megrahi, last August. Despite the outcry in the UK (and especially the United States), and the many explanations proffered, including those in Newnations, it is clear that had al-Megrahi died in a Scottish prison, the Libyan government would have reacted, probably even violently against British interests and citizens in the country. In a sense, Libya’s newly found pride has adopted a vindictive nature that is getting in the way of pragmatism.

There has been speculation as to whether the two Swiss men’s continued detention (more technically ‘prevention to leave’) in Libya also represents a reaction to the Swiss minaret referendum cited above. While there may be a connection, the appeal trial itself will have to be concluded before this becomes clearer; Libya’s intention to prosecute the two businessmen was made clear since the problem first emerged in 2008. In fact, it may be easier to suggest that the Swiss referendum results, 57% in favor of banning minarets, was influenced by Libya’s handling of the incident, which has been in the headlines of Swiss media for the past year and a half. Libya paid the two hotel staff members, who were hit by Hannibal al-Qadhafi and his pregnant wife, not to press charges. It may well be that Libya is itself seeking ransom money in a behind the scenes deal to be concluded after they face the appeals trial that - if the ‘Bulgarian nurses’ affair is any indication - will reconfirm the charges and guilt of the two Swiss men. Switzerland has described the arrest as a "violation of international law" prompting it to reduce the level of diplomatic ties with Libya.

Apart from the ‘psychological’ explanations pointing to a renewed Libyan pride and sense of importance, the detention of the two Swiss citizens also points to rifts within the regime of Col. Mu’ammar al-Qadhafi. While the Libyan leader’s son Hannibal has earned a reputation for being trouble - an international ‘man of nuisance’, his other son Saif ul-Islam, who would seem to be the likeliest successor to Libya’s leadership, has been cultivating a far more positive international image. In early December, Saif-ul Islam sponsored an unprecedented conference on Libya’s human rights record, which featured the NGO Human Rights Watch (HRW). During the tormented appeals process for the Bulgarian nurses, Saif ul-Islam had publicly stated that the blame for the infection of 400 children with AIDS at a Benghazi hospital lay with the inadequacy of Libyan infrastructure and poor hospital management. Saif ul Islam does not have an official government role and he faced considerable opposition from the anti-reform minded Revolutionary Committees. Saif ul Islam has clearly emerged as one of the main promoters of openness, along with his ‘protégé’ Shokry Ghanem (the director of the National Oil Company and former prime minister). Some security service staff attended the press conference and arranged for some members in the audience to heckle the speakers.

The human rights conference brought into the open the tensions that exist between Saif, who has a very western outlook favoring social, political and economic liberalization and the Revolutionary Committees and related apparatchiks, having closer ties to Saif’s other brothers. Saif might be considered the architect of Libya’s rapprochement with the West since 2003 and he has founded two private newspapers, which managed to irritate the old guard with their more sincere approach, forcing these to be shut down. The Conference served as the first platform in Libya’s recent history for a formal denunciation of the Libyan regime, which admitted to having arrested and killed hundreds of political prisoners (notably in 1996 during a revolt at Abu Selim prison). Contrasts in the Libyan leadership were evident throughout 2009, even as the regime ostensibly gained ground on all outstanding international issues of concern, helping to boost power at home. In spite of this apparent confidence, Libya remains a risky place to invest. It is subject to unpredictable dangers for foreign (and of course local) citizens as well as arbitrary government decisions which counter international business norms, such as banning Canadian oil company Verenex from selling its Libyan oil prospecting assets to a Chinese company, only to have the Libyan government buy it at a much lower price.

Libya is also taking risks. By failing to enforce predictable norms and to follow through on the many plans that it had announced in the past five years to attract foreign investment, foreign oil companies have become less interested in Libyan oil and gas, fearing norms that are ever more restrictive and lower margins for profit. The Verenex, Swiss businessmen and human rights conference ‘cases,’ indicate untrustworthy decision-making and contrasts and fears that power battles between government departments – such as the powerful security institutions – will likely impact foreign companies' investment and oil-development plans in the future. Already, Libya has had to revise its growth predictions to achieve a 3 million BPD oil production rate by 2011 until 2016/2017. Libya’s capacity remains at 1.8 million BPD.        

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