Arab Spring: Why western narratives still miss the point


Miriyam Aouragh & Hamza Hamouchene

December 22, 2021

Uprisings that began in 2010 were about more than anti-authoritarianism and broken promises, but mainstream analyses tend to focus on Orientalist tropes.

Anniversaries have symbolic power, which can be a good opportunity to take stock of what happened and reflect on the positives and negatives. They can also be dynamic moments where we think about how to move forward. 2021 constitutes such a moment, as it coincides with the 10th anniversary of the Arab Spring.

Back in 2011, a wave of revolt spread across the Middle East and North Africa region, in what came to be called the Arab Spring. The uprisings shook the world. In Tunisia and Egypt, they ignited historic upheavals in North Africa and beyond, as people cheered the toppling of the dictatorial Ben Ali and Mubarak regimes, and looked ahead to meaningful changes in their lives.

These uprisings, like most revolutionary situations, released enormous energy; an unparalleled sense of renewal and a shift in political consciousness.

The narrative advanced is one of despair and hopelessness: the uprising was not worthwhile – it would have been better to remain in poverty and chains

The peoples of the region are all too familiar with the racist stereotypes in the facile falsehood that “Arabs and Muslims are not fit for democracy and are incapable of governing themselves”. Imperial and colonial dominance over the region have led to it being viewed in some quarters as a homogeneous entity, systematically reduced through negative tropes.

Orientalist imagery of conflict and wars, ruthless dictators and passive populations, terrorism and extremism, rich oil reserves and expansive deserts – such rigid representations of “the Other” are a hallmark of the type of political and geographic violence that has been so well articulated by Edward Said.

The uprisings shattered many of these stereotypes and debunked numerous myths. The winds of revolution that began to blow in December 2010 spread from Tunisia to Egypt, Libya, Syria, Yemen, Bahrain, Jordan, Morocco and Oman. The emancipatory experience was contagious, inspiring people all over the world: activists in Madrid, London and New York, whether calling themselves the Occupy movement or the Indignados, were all proud to “walk like an Egyptian”.

Deep polarisation

While the last three to four decades have seen attempts to delegitimise radical change through revolution, following the shortcomings and defeats of decolonisation efforts in various parts of the Global South, emancipatory revolutions and uprisings will continue.

Yet, we cannot deny that what started as inspiring uprisings against authoritarianism and oppressive socioeconomic conditions – demanding bread, justice and dignity – morphed into violence and chaos, profound polarisation, counter-revolution and foreign intervention. Various people’s movements found themselves pitted against entrenched authoritarian and counter-revolutionary forces bent on suppressing them. All were met with resistance from the state, often in conjunction with global capital and foreign interference.

The military coup in Egypt ended up restoring a much more ruthless and repressive form of dictatorship. The brutal descent into civil wars in Syria, Libya and Yemen, and the series of crackdowns in Gulf countries such as Bahrain, highlighted the cruel logic of proxy war, so reminiscent of the colonial schemes known all too well across the region.

Tunisians mark the anniversary of the Arab Spring in Tunis in 2016 (AFP)

Tunisia, which had seemed to be the exception to this gloom and doom, is now in a fragile position. And the deep polarisation (Islamist versus secularist) imposed on the masses have distracted them from the key socioeconomic issues that originally launched the uprisings.

Some mainstream commentators have argued that the Arab Spring gave way to an “Islamist winter”, with Islamist forces coming to power in some countries. Other progressive voices have been less pessimistic, offering a more historically nuanced perspective that views these events as part of a long-term revolutionary process, with ups and downs, periods of radicalisation and counter-revolution.

The latter view received some vindication when, eight years after the 2010/11 events, a second wave of uprisings gripped Sudan, Algeria, Iraq and Lebanon, followed by a return to the spotlight this year of the unending and heroic Palestinian struggle – all highlighting people’s determination to continue fighting for their rights and sovereignty.

New horizons

The momentous events that have unfolded between 2010 and 2021 have opened new horizons for people to express their discontent and demand radical change and reforms, forcing almost every government in the region to make political and economic concessions.

Various misconceptions have also emerged, including attempts by the mainstream media, western governments and international financial institutions to portray the uprisings merely as revolts against authoritarianism, seeking the stunted type of political freedoms and democracy that exist in western countries. This avoids any class analysis and separates politics from economics, ignoring the fundamental socioeconomic demands of bread, justice and dignity.

But the distortions did not stop there. The Tunisian and Egyptian uprisings were dubbed by western commentators as “Facebook and Twitter revolutions”, exaggerating the role of social media in fomenting them. Another dominant, but no less superficial, framing interpreted the revolts as primarily youth uprisings against the older generation – the product of a “youth bulge” in affected countries.

A decade later, mainstream narratives commemorating the 10th anniversary have gained little insight. Reports speak of failed and lost revolutions, and of broken promises. But the dominant tone is captured in the headline of a Guardian article published last December, referring to Mohamed Bouazizi, the street vendor who set himself on fire, catalysing the Arab uprisings: “‘He ruined us’: 10 years on, Tunisians curse man who sparked Arab Spring.”

The narrative advanced is one of despair and hopelessness: the uprising was not worthwhile – it would have been better to remain in poverty and chains. Such interpretations must be strongly challenged and deconstructed in order to advance a more nuanced, less idealistic reading of the revolutionary process.

Revolutionary dynamics are complex, coming with inevitable crises, shortcomings and failings.They are imbued with counter-revolutionary tendencies and encroached upon by reactionary forces. That people in the region are continuing to revolt highlights this complexity.

Ultimately, the ideas people hold about revolutions can significantly affect their outcomes, which is why we must reflect upon and learn from past uprisings.

***

Miriyam Aouragh is a Dutch-Moroccan anthropologist. She is a Reader at the Communication and Media Research Institute, University of Westminster. She is the author of the book Palestine Online and the forthcoming Mediating the Makhzan. Her research and writings focus on cyber warfare, grassroots digital politics and (counter-) revolutions.

Hamza Hamouchene is the North Africa Programme Coordinator at the Transnational Institute (TNI). His writings appeared in the Guardian, Huffington Post, Counterpunch, Jadaliyya, New Internationalist and openDemocracy.

______________

EYE ON SPYING
US holding Kremlin insider who may have secrets of 2016 hack

Tycoon scheduled to appear in court on Monday to face criminal charges, but not for spying


Photo credit: LT archives

LONG READ

In the days before Christmas, U.S. officials in Boston unveiled insider trading charges against a Russian tech tycoon they had been pursuing for months. They accused Vladislav Klyushin, who’d been extradited from Switzerland on Dec. 18, of illegally making tens of millions of dollars trading on hacked corporate-earnings information.

Yet as authorities laid out their securities fraud case, a striking portrait of the detainee emerged: Klyushin was not only an accused insider trader, but a Kremlin insider. He ran an information technology company that works with the Russian government’s top echelons. Just 18 months earlier, Klyushin received a medal of honor from Russian President Vladimir Putin. The U.S. had, in its custody, the highest-level Kremlin insider handed to U.S. law enforcement in recent memory.

Klyushin’s cybersecurity work and Kremlin ties could make him a useful source of information for U.S. officials, according to several people familiar with Russian intelligence matters. Most critically, these people said, if he chooses to cooperate, he could provide Americans with their closest view yet of 2016 election manipulation.

According to people in Moscow who are close to the Kremlin and security services, Russian intelligence has concluded that Klyushin, 41, has access to documents relating to a Russian campaign to hack Democratic Party servers during the 2016 U.S. election. These documents, they say, establish the hacking was led by a team in Russia’s GRU military intelligence that U.S. cybersecurity companies have dubbed “Fancy Bear” or APT28. Such a cache would provide the U.S. for the first time with detailed documentary evidence of the alleged Russian efforts to influence the election, according to these people.

Klyushin’s path to the U.S. — his flight from Moscow via private jet, his arrest in Switzerland, and his wait in jail as Russia and the U.S. competed to win his extradition — is described in U.S., European and Swiss legal filings, as well as in accounts of more than a half-dozen people with knowledge of the matter who requested anonymity to speak about Moscow’s efforts and its causes for concern.

According to these accounts, Klyushin was approached by U.S. and U.K. spy agencies in the two years before his exit from Russia and received heightened levels of security in Switzerland. He also missed a final chance to appeal his extradition, an omission that baffled many observers in Moscow. His transfer to the U.S. represents a serious intelligence blow to the Kremlin, several of the people said, one that would deepen if Klyushin decides to seek leniency from U.S. prosecutors by providing information about Moscow’s inner workings.

Three of the people added that they believe that Klyushin has access to secret records of other high-level GRU operations abroad.

Russian military intelligence agents in recent years have been linked to a series of hacking attacks as well as the attempted chemical poisoning assassination of dissident ex-GRU colonel Sergei Skripal and his daughter in the U.K. in 2018. Russia has denied involvement.

Indications of Klyushin’s vantage point are peppered throughout U.S. filings. His IT firm, M-13, worked for the Russian presidency, government and ministries, according to his insider trading indictment. Among his subordinates was a former military intelligence official named Ivan Yermakov, who is charged alongside Klyushin in the indictment.

Yermakov is also a defendant in a 2018 indictment from U.S. Special Counsel Robert Mueller’s team that accuses him and 11 other Russians of hacking into Democrats’ computers systems. That case has yet to be resolved because its defendants remain outside the U.S., but prosecutors could pursue and expand that case if new information presents itself.

Klyushin’s attorney in Switzerland, Oliver Ciric, said he doesn’t know anything about what, if any, documents his client may have. Ciric said in an interview that his client was sought by U.S. authorities because they believe he has inside information on Russia’s 2016 election hacking that he may provide to avoid decades behind bars on the insider trading charges. Ciric added that Klyushin says he is innocent of insider trading and of “hypothetical election meddling.”

Klyushin’s U.S.-based lawyer Maksim Nemtsev, writing in a bail application, said his client “intends to challenge the government’s case in a lawful, professional and principled manner.” Klyushin is set to appear for arraignment on Monday. Nemtsev didn’t respond to a request for additional comment.

Any exposure of Russian hostile behavior by law-enforcement officials risks inflaming relations just as President Joe Biden’s administration is engaged in delicate efforts to dial back tensions with Putin. The latest unease is sparked by Russia’s massive military buildup near Ukraine, as U.S. intelligence indicates the threat of a Russian invasion of its ex-Soviet neighbor. U.S. and Russian negotiators are due to meet Jan. 9 in Geneva to discuss the Kremlin’s demands for legally binding guarantees of a halt to NATO eastward expansion.

Klyushin’s extradition suggests that federal law enforcers haven’t dropped their pursuit of “the radical violation of U.S. sovereignty during the 2016 elections that involved criminal behavior,” according to Michael McFaul, who was a U.S. ambassador to Russia during the Obama administration.

“You may be seeing the signs that they are continuing to pursue this case, with real big implications for exposing in even greater detail what the Russians did to influence the outcome of our election,” McFaul said. He added that Klyushin’s extradition is a “serious concern” for the Russian government. “It underscores the risk that anybody, billionaires or others close to the Russian state, face when they break American laws if they travel abroad,” he said.

Kremlin spokesman Dmitry Peskov didn’t respond to a request for comment. Russia’s Foreign Ministry declined to comment.

Top Cyber Clients

Klyushin’s M-13 promised a range of information tech services, including social media monitoring and cybersecurity, according to U.S. filings that cited the company’s website. It offered to probe its clients for cyber weaknesses by simulating attacks — known as penetration testing — and also by mounting targeted ongoing attacks known as advanced persistent threats, or APT. The company provided a media-monitoring system, Katyusha, to the Kremlin and Defense Ministry, as well as services to other government institutions such as the Prosecutor General’s Office, National Guard and Moscow city hall, according to Russian state contract records.

For his part, Klyushin amassed “immense wealth,” U.S. prosecutors wrote. They cited his ownership of a three-million-pound ($4 million) yacht purchased in the U.K., a London apartment and millions of dollars in cash.

Klyushin is one of several high-level individuals in Russia’s cyber sector who have been at the center of drama in both Russia and the U.S. Two of these Russians provided information several years ago that led to U.S. indictments of Russians for alleged election manipulation, Bloomberg has previously reported.

One was arrested in Russia in 2016 and jailed on treason charges. The other, Russian cybersecurity entrepreneur Ilya Sachkov, was close to Klyushin, three of the people said. Sachkov provided the U.S. government with information that helped it identify the 12 GRU agents it accused of involvement in the hacking of Democratic servers, including Klyushin’s senior employee Yermakov, people familiar with the matter have previously told Bloomberg. Russia has repeatedly denied meddling in U.S. elections. Sachkov was arrested in Russia in September and is jailed awaiting trial on unspecified treason charges.

U.S. and British intelligence tried twice to recruit Klyushin, according to Ciric, the attorney in Switzerland. U.S. intelligence attempted to engage him in summer 2019 in the south of France and British intelligence approached him in March 2020 in Edinburgh, Ciric said.

Klyushin memorialized that second meeting in a note he wrote a few weeks after the encounter and saved on his computer, according to Ciric. It took place at Edinburgh’s airport, as Klyushin was taking a flight back to Russia, according to the memo, which was submitted to the Swiss courts as part of his appeal against extradition. Klyushin wrote that two British intelligence agents — one from MI5 and the other from MI6 — spoke to him for a few minutes in a room where he was led after a passport check.

The two Russian-speaking officers, a man and a woman, asked him if he would “cooperate” with U.K. secret services and took his phone number to set up a meeting on his next trip to London planned for May, according to the previously unreported document, which was reviewed by Bloomberg. Klyushin wrote that while he didn’t respond to the cooperation offer, he said he would be willing to see the agents again to discuss selling M-13 products to British intelligence.

It’s unclear whether Klyushin informed Russian intelligence about the U.S. and British recruitment efforts. The U.K. Foreign Office, which handles media inquiries for MI6, declined to comment.

Family Ski Vacation

The U.S. learned that Klyushin was traveling in the spring of 2021 to Switzerland, which has a joint extradition agreement with the U.S., and issued an arrest warrant on March 19. Ciric said he believes the U.S. learned of the trip “a few days before” by illegally hacking his client’s phone, noting that Klyushin’s Switzerland itinerary and other personal information and photos from the device made their way into case materials. The Justice Department didn’t respond to a request for comment.

Two days later, a private jet flying from Moscow touched down at Sion Airport in southwestern Switzerland. Klyushin, his wife and five children stepped off the plane. A helicopter was standing by to whisk them to the exclusive ski resort of Zermatt, according to U.S. filings.

Shortly after leaving the plane, Klyushin was detained by Swiss police. He was taken hours later to a prison in nearby Sion.

His wife and kids continued to the ski resort along with a business partner and his daughter, according to two people familiar with the matter. The party returned to Moscow on March 29, after almost 10 days at a luxury chalet, these people said.

News of Klyushin’s detention provoked immediate action in Moscow: On April 7, Russia filed papers with Switzerland accusing Klyushin of fraud and seeking his extradition to face charges in his home country — a strategy the country has attempted to use in recent years when nationals have been accused abroad.

Three of the people familiar with the matter characterized Klyushin’s departure to Switzerland as a huge failure of Russian secret services after his contacts with intelligence agencies, and they said they expect the top officials responsible to lose their jobs.

The Swiss held Klyushin under high security, alone in a cell, according to his lawyer. He was accompanied by as many as 10 police, most of them heavily armed, on his only trip between the jail and the courthouse in Sion in April — unprecedented security measures for white-collar cases in Switzerland, according to his lawyer.

While in the Swiss prison, Klyushin told Bloomberg, through his lawyer, that he didn’t know why he was arrested in March and not before, saying that he had previously traveled freely to Europe. He blamed his detention on an “operation mounted by the U.S. in cooperation with Swiss authorities” to obtain “certain confidential information the American authorities consider” he has.

The U.S. filed its own extradition bid for Klyushin nearly two weeks after Russia, on April 19.

By then, a U.S. federal grand jury had already handed up indictments charging Klyushin and Yermakov — identified in some in filings as Kliushin and Ermakov — and three other alleged conspirators.

Filed on April 6, the sealed indictment of Klyushin accused the group of hacking into the servers of two online agencies used by U.S. publicly traded companies to file their quarterly reports a day or two before they’re released. With an advance look at the results, the men bet on or against stocks including International Business Machines Corp., Snap Inc., Tesla Inc. and Microsoft Corp., netting them illegal profits of $82.5 million, according to the indictment. Klyushin faces a recommended sentence of 20 years in prison, though the charges carry a maximum penalty of 50 years.

Headlining the investigation was B.J. Kang, an FBI special agent famous for bringing in convicted fraudster Bernie Madoff and inside trader Raj Rajaratnam. The U.S. Securities and Exchange Commission has also filed charges.

Diplomatic Snarl

In August, Switzerland rejected Moscow’s extradition request.

Soon after came an international diplomatic snarl that speaks to Klyushin’s importance to Moscow. Following a Russia-U.S. presidential summit in June, the two sides were negotiating to swap two former U.S. Marines imprisoned in Russia, Paul Whelan and Trevor Reed, for two Russians held in the U.S., including notorious arms dealer Viktor Bout. But after Switzerland declined to hand Klyushin back to Russia, the Kremlin demanded that his name be added to the swap, according to three people with knowledge of the issue. That derailed the potential exchange, which remains blocked, these people said.

There is no link between Klyushin and the return of Reed and Whelan to the U.S., said a U.S. National Security Council spokesperson. The U.S. government continues to press for their release, the spokesperson said.

Klyushin’s chances of a trip to the U.S. grew when the Swiss supreme court refused to consider an appeal against his extradition, saying it had no reason to challenge the legitimacy of the U.S. courts. The panel made its ruling in a Dec. 10 session, which was communicated to Ciric on Dec. 16, according to him and the court.

Once Switzerland’s top court refuses an appeal, detainees can be handed over within two to four days, Ciric said in an interview a month before the ruling.

That left Klyushin with a brief window to make a last-ditch appeal of his extradition — a request to the European Court of Human Rights, based in Strasbourg, France. However, his attorney filed that request in a way that took days, rather than hours. That led three of the people close to the Kremlin and Russian security services to conclude that Ciric may have facilitated a transfer to U.S. custody on his client’s instructions. Ciric didn’t respond to a request for comment on the timing of the ECHR appeal.

Once Ciric had received the supreme court’s decision, the Geneva lawyer filed a petition with the ECHR, reviewed by Bloomberg. The letter, dated Dec. 16 and labeled in French as “urgent,” asked the court to suspend the extradition order.

A day later, on Dec. 17, Ciric emailed Russian Foreign Minister Sergei Lavrov. “We have urgently filed an application with the European Court of Rights” requesting it “immediately put on hold the extradition of Mr. Klyushin since this action will undoubtedly cause irreparable damage,” Ciric wrote in the previously unreported letter, which was reviewed by Bloomberg.

A spokesman for the Strasbourg court said emergency requests are typically faxed or emailed to ensure immediate delivery — which in this instance may have made all the difference. On Dec. 18, U.S. agents took custody of Klyushin at Zurich airport and flew him to face trial in the U.S.

Klyushin’s request was received by the ECHR only on Dec. 22, according to the Strasbourg court’s spokesman. By then, Klyushin had already been in the U.S. for four days.

©2022 Bloomberg L.P.

Nasrallah: US turned to Gen. Soleimani for help to exit Iraq

ByIFP Editorial Staff
January 2, 2022


The head of Lebanon’s Hezbollah resistance movement says the Americans asked Iran’s senior commander Lieutenant General Qassem Soleimani in 2011 to help pave the way for their safe withdrawal from Iraq.

Sayyed Hassan Nasrallah made the remarks in an interview with Lebanon’s al-Mayadeen TV, a Persian translation of which was published by IRNA for the first time Sunday, on the second anniversary of General Soleimani’s assassination by the US.

Nasrallah was asked about the behind-the-scenes role of General Soleimani in the US military’s withdrawal from Iraq in 2011, eight years after the Americans invaded the country under the guise of fighting terror and eliminating weapons of mass destruction.

The Hezbollah chief said the period between 2003 to 2011 should be remembered as the stage of “resistance against American occupiers,” during which the resistance front “made the United States exit Iraq with humiliation.”

Nasrallah said after an agreement was signed with Baghdad on the withdrawal of US forces, the Americans “spoke with [Iran’s] Quds Force, not directly but via their agents.”

“They told their agents to ask Qassem Soleimani to have a word with resistance forces in Iraq and secure a deadline of 2-3 months for us to leave Iraq,” he said.

“To make it short, the gist of their demand was that ‘we want to retreat from Iraq but we don’t want that to happen under the fire of the resistance,’” Nasrallah added.

“Trump belongs in ash heap of history after Gen. Soleimani assassination”

ByIFP Editorial Staff
January 3, 2022

On the second anniversary of the US assassination of top Iranian commander Lieutenant General Qassem Soleimani, the office of Leader of Iran’s Islamic Revolution has in a tweet said Donald Trump will go to the dustbin of history after paying the price for the assassination

“Martyr Soleimani will live forever; but those who martyred him, Trump and the likes, belong in the ash heap of history, and will be among the forgotten by the history and will get lost. Of course, God Willing, after paying for their actions here in this world,” read the tweet, posted almost exactly on the minutes that marked the second anniversary of General Soleimani’s assassination.

The Iranian commander was assassinated in a US drone strike near Baghdad Airport on January 3, 2020. The then US President Donald Trump claimed responsibility for ordering Soleimani’s assassination.

Raisi: Trump must face retribution over gen. Soleimani assassination
January 3, 2022

US says armed drones brought down at Baghdad airport
January 3, 2022

IFP Editorial Staffhttps://ifpnews.com/ifp-editorial-staff
The IFP Editorial Staff is composed of dozens of skilled journalists, news-writers, and analysts whose works are edited and published by experienced editors specialized in Iran News. The editor of each IFP Service is responsible for the report published by the Iran Front Page (IFP) news website, and can be contacted through the ways mentioned in the "IFP Editorial Staff" section.

U.S. assassination of Iran's top general raises "hatred" in global opinion: ministry

(Xinhua) , January 03, 2022

TEHRAN, Jan. 2 (Xinhua) -- Iran's Foreign Ministry said on Sunday that the U.S. assassination of the country's top general two years ago has raised "hatred" in global opinion.

"The world's reactions to the assassination of Iranian General Qassem Soleimani were that all nations have strongly despised the U.S. bullying and hegemonic policies," the Iranian Foreign Ministry said on its Twitter account.

"If the U.S. officials failed to see the images of hatred on the streets of the countries worldwide, they are puppet of their own media empire," the ministry added.

A U.S. airstrike on Jan. 3, 2020 killed Soleimani, former commander of the Quds Force of Iran's Islamic Revolution Guards Corps, along with an Iraqi militia commander, near the Baghdad International Airport.

Tehran Prosecutor General Ali Qasi Mehr said earlier that Iran had filed a case with the Interpol to arrest a number of U.S. political and military officials "who were involved in the assassination of Soleimani." 

Vehicles drive past a billboard showing late Iranian General Qassem Soleimani in Tehran, Iran, on Jan. 2, 2022, one day ahead of the second anniversary of his assassination by the United States in Iraq. Iran's Foreign Ministry said on Sunday that the U.S. assassination of the country's top general two years ago has raised "hatred" in global opinion. A U.S. airstrike on Jan. 3, 2020 killed Soleimani, former commander of the Quds Force of Iran's Islamic Revolution Guards Corps, along with an Iraqi militia commander, near the Baghdad International Airport. (Xinhua/Gao Wencheng)

Iran urges UNSC to hold US, Israeli regime accountable for Soleimani’s assassination

Tehran (ISNA) - Ambassador and permanent representative of the Islamic Republic of Iran to the United Nations, Majid Takht Ravanchi in a letter to the President of the UN Security Council condemned assassination of Martyr Major General Qasem Soleimani, the Commander of the Quds Force of the Islamic Revolutionary Guard Corps, by the United States.

Here is the full text of Majid Takht Ravanchi’s letter:

In the name of God, the most Compassionate, the most Merciful

Excellency,

Concurrent with the second anniversary of the horrific assassination of Martyr Major General Qasem Soleimani, the Commander of the Quds Force of the Islamic Revolutionary Guard Corps – an official branch of the armed forces of the Islamic Republic of Iran – and his companions, on 3 January 2020 at Baghdad International Airport, at the direct order of the then President of the United States, I would like to bring to your attention the recent information concerning the involvement of the Israeli regime in this heinous terrorist act.

In a recent interview, the former military intelligence chief of the Israeli regime admitted the involvement of the Israeli regime in the premeditated assassination of Martyr Soleimani, stating that the “Israeli intelligence played a part” in that assassination, and described it as “an achievement” and one of the two significant and important assassinations during his term .

As I have on numerous occasions underlined, including in my letters dated 3 January 2020 (S/2020/13), 7 January 2020 (S/2020/16) and 29 January 2020 (S/2020/81) addressed to the Secretary-General and the President of the Security Council, this internationally wrongful criminal act was a grave breach of the obligations of the United States under international law, thus entails its international responsibility.

This criminal act also entails the criminal responsibility of all those who had aided, abetted or otherwise assisted and supported, by any means, directly or indirectly, the planning or perpetration of this terrorist act, the clear example of which is the supportive role and the involvement of the Israeli regime in it.

Martyr Soleimani played a significant role in combatting international terrorism and accordingly was rightfully given the title of the Hero of the Fight against Terrorism and the General of Peace, and therefore his cowardly assassination was a big gift and service to Daesh and other Security Council designated terrorist groups in the region who welcomed his assassination, calling it “an act of divine intervention that benefitted” them.

Given the dire implications of this terrorist act on international peace and security, the Security Council must live up to its Charter-based responsibilities and hold the United States and the Israeli regime to account for planning, supporting and committing that terrorist act.

In line with our rights and obligations under international law, the Iranian armed forces are determined to vigorously continue Martyr Soleimani’s path in actively assisting regional nations and governments, upon their requests, to combat foreign-backed terrorist groups in the region until they are uprooted completely.

I should be grateful if you would have the present letter circulated as a document of the Security Council.

Please accept, Excellency, the assurances of my highest consideration.

End Item

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Libya: Investing the Wealth of a Nation 

The extraordinary story of Libya’s overseas investments and seemingly endless battle over their control.



Tim Eaton
December 28, 2021

VERY LONG READ

 (THREE PARTS)

PART (I)

Attention is once again focused on Libya as the political process being convened by the United Nations (UN) has agreed the appointment of a new interim government to see Libya through to elections at the end of 2021.

But, while the ongoing failure of governance in Libya continues to make international headlines, the impact it leaves on the management of Libyan state assets overseas receives minimal coverage – even though this impact is highly significant for the people of Libya.

Since 2006, the country’s investments in global markets have been made principally through a sovereign wealth fund – the Libyan Investment Authority (LIA). And yet, after all this time, it remains unclear precisely what the total value of the LIA’s assets are, even to its current leadership. The commonly-cited estimate of the LIA’s value is $67 billion.

Problems of structure and governance have persisted as the LIA struggles to escape the legacy of the Muammar Gaddafi regime. The LIA was formed not just as a means of allocating the windfall from the sale of oil and gas for the benefit of future generations, but also as a tool for distributing patronage and leveraging political influence.

Since the 2011 revolution, the LIA has been a battleground. Interests entrenched from the Gaddafi era have sought to preserve their stake while new actors work to wrestle control of parts of the organization. And these Libyan battles have been exported to courtrooms around the world – from London to the Cayman Islands – while the UN asset freeze on the LIA does not in reality cover all of its structure, meaning some elements remain up for grabs.

Examining these dynamics, and the story of how the LIA came to prominence, provides extraordinary insight into what has happened to the wealth of the Libyan population, as well as highlighting what external states – in whose markets the LIA still engages – should be doing about it.

Early investments and the debate over the ‘mujanib’

In 1977, the Italian car giant Fiat was struggling. On the hunt for investment it obtained $400m from Libya, the country’s first such major investment. The resulting shares in Fiat were held by the Libyan Arab Foreign Investment Company (LAFICO).

But as Fiat’s fortunes improved in the 1980s, it reportedly feared that the Libyan investment could be an impediment to entering the US market because of allegations at the time of Libyan support for international terrorism.

Libya sold its shares in 1986 for $3 billion, a huge profit, which was placed in a new investment vehicle, the Long-Term Portfolio (LTP). But sinking global oil prices and the sanctions on Libya following the 1988 Lockerbie incident made similar international forays difficult.

Although the OilInvest Group emerged in 1988 after the Libyan state purchased Tamoil – a fuel refining and distribution company – the imposition of sanctions in 1992 saw Tamoil’s corporate structure amended to place the majority of its shareholding into non-Libyan ownership, seemingly to insulate the company from the impact of the sanctions.

More was possible in African markets, to which Gaddafi pivoted to further his political influence, and a stream of investments overseen by Bashir Saleh – known as ‘Gaddafi’s banker’ – were made before being formalized as the Libya Africa Investment Portfolio (LAIP) in 2006. By now a significant surplus was being generated, but Libya’s budget remained under strict control as oil prices were high and running costs low – so the ‘mujanib’, essentially meaning ‘leftovers’, needed investing somewhere.

At the time, the Libyan market had limited absorptive capacity and the rather frugal leadership of Libya’s existing sovereign institutions were cautious. But a younger group of leaders, including individuals such as former Libyan prime minister Shukri Ghanem, argued for the establishment of a sovereign wealth fund.

In 2006, a resolution within Libya’s then legislature, the General Peoples Committee (GPC), created the Libyan Investment Authority (LIA) as an investment department for regular and alternative investments, with around $8 billion of funds.
Coming in from the Cold

The LIA’s emergence came just as Libya was being rehabilitated by the international community, and the financial world’s elite jetted into Tripoli to court Libyan investment. But a political power struggle was also now underway within Libya over which of Gaddafi’s sons would succeed their father, and institutional islands of influence were emerging along with different visions for how Libya should be governed.

The LIA fell under the influence of Gaddafi’s eldest son Seif al-Islam and the fiscally-liberal crowd surrounding him – such as Mohamed Layas who became the first CEO of the LIA and his deputy Mustafa Zarti. The pair built up the LIA investment portfolio, but generated losses from 2007-2009 which cast a shadow over the organization still apparent today. Insiders have suggested Seif was the real power within the organization.

The scale of these losses became clear in a 2010 KPMG audit of LIA assets. The report, leaked and released publicly in 2011, made for grim reading as it identified five funds which made a loss of 23 per cent on a $1.4 billion investment, despite the market overall increasing 25 per cent in the previous year. Interestingly, it also valued the LIA’s overall assets in September 2010 at $64.2 billion.

The audit was timely as lawmakers had recently decided to consolidate all of Libya’s major overseas investment vehicles under an expanded LIA. Law 13 (2010) brought LAFICO, the LTP, OilInvest, LAIP and the Libyan Local Investment Development Fund under the aegis of the LIA.

In the words of Ahmed Jehani, a former Libyan minister who has worked with the LIA in various guises, the law had created a ‘humpy dumpty’ of five subsidiaries and around 550 companies.

Revolution, Upheaval and Division

With the end of the Gaddafi regime in 2011, the LIA along with many other Libyan state institutions became embroiled in a post-revolutionary struggle for control, hindering necessary reform. Although Layas was retained as chair by the interim governing authorities, Zarti distanced himself from the organization and was replaced by Rafiq Nayed as acting CEO.

The first post-revolution prime minister, Abdelrahman al-Keib, appointed Mohsen Derregia as chair and CEO in April 2012 to replace Zarti and Nayed. He inherited an LIA that, despite the passing of Law 13, had not truly united. He complained there were no audited accounts since 2008 and that he received no official handover.

Derregia decided to hire PwC to help fill in gaps in the accounts from 2009-2011, Deloitte to conduct an audit to value the assets of the LIA and its subsidiaries on the books, and Oliver Wyman to develop its investment strategy and reform governance. He also noted the value of the assets owned by the LIA had been treated as fixed at the historic price and not independently valued. The systems established in the Gaddafi era meant nobody was prepared to report losses even if they came due to a global financial crash.

But Derregia insists he felt there was resistance to change and transparency from the outset, saying: ‘When I arrived, I found out that all of the departmental managers [for the LIA] had been given a one-month holiday.’

Derregia says he tried to replace several LIA directors because, he felt they were subject to potential conflicts of interest as they worked, or had worked, with firms that received investments from the LIA. But support from the prime minister – who was the chair of the LIA board of trustees by virtue of his government position – was not forthcoming. This brought Derregia into conflict with the new board of directors over allegations that appointments were being made without appropriate due process.

As relations with the board of directors worsened, Derregia was removed by newly appointed prime minister Ali Zidan in March 2013 after less than one year in post. He was replaced by Abdulmagid Breish in June 2013. Breish again brought in the major international firms – Deloitte to value assets and undertake forensic accounting, and Oliver Wyman to use the information collected by Deloitte to benchmark the LIA against leading sovereign wealth funds, and to develop a strategic roadmap.

Breish also wanted to investigate what happened in relation to some of the major investments in the LIA’s early years – identified as what he termed ‘$5-6 billion of highly suspicious’ assets – but his time as chair and CEO was curtailed by the new highly controversial Political Isolation Law which barred those who held leadership posts in state institutions under Gaddafi from holding them again. Breish was removed from his position in June 2014, timing that he noted coincided with his investigation into the assets.

He was succeeded by Abderahmane Ben Yezza as LIA Chair and CEO. The nature of Ben Yezza’s appointment – whether it was temporary, while Breish fought his case in court, or permanent – is contested. This would have a bearing on the future dispute over leadership of the organization.

Meanwhile, following the disputed June 2014 parliamentary election results, Libya had once again descended into civil war. The House of Representatives – the newly-elected, albeit contested, parliament – relocated to the east of the country citing security concerns and would appoint a new ‘Interim Government’ based in the eastern city of al-Bayda.

But many members of the House of Representatives did not relocate. A reconstituted rump of the General National Congress (GNC) subsequently appointed its own ‘Government of National Salvation’ in Tripoli.

The existence of two governments led to administrative chaos. The absence of both a unified and universally recognised executive and legislative led to the emergence of parallel leaderships of state institutions and undermined any checks and balances that did exist in Libya’s governance. The LIA was no exception.

In October 2014, the eastern-based Interim Government – then the only government in Libya – appointed LIA board member Hassan Bouhadi as the new chair and CEO of the LIA. Bouhadi, citing the same security concerns, set up the LIA office in Malta following the conduct of a memorandum of understanding with the Maltese government.

Then in April 2015, the LIA board of trustees – made up of the executive members of the Tripoli-based Government of National Salvation – actioned a decision by the Libyan court to overturn the ruling of the Political Isolation Committee against Breish and reinstate him as chair and CEO of the LIA.

This led to an ongoing dispute as to whether Breish could return to his position or whether Bouhadi had already succeeded Ben Yezza, meaning that there was no position to which Breish could return. Practically, this meant the Tripoli headquarters of the LIA was controlled by Breish and the Malta office was controlled by Bouhadi – the LIA was split, albeit with all board members but Ben Yezza reporting to Bouhadi.

***

PART (II)

The asset freeze and the rest of the iceberg

Back in 2011, following protests in Libya, the international community was quick to freeze assets it deemed could be used to fund the Gaddafi regime’s military campaign. UN Security Council Resolution 1970, passed on 28 February 2011, announced an asset freeze on specific members of the Gaddafi family.

This was then expanded in March to include designated assets and resources controlled by the Libyan authorities in Resolution 1973.

These assets and resources were the LIA, LAIP, and LAFICO, along with those of the Central Bank of Libya and the Libyan Foreign Bank. The freeze on the latter two was quickly lifted but the freeze on the LIA, LAIP, and LAFICO remains in place. In September 2011, Resolution 2009 eased the terms of the asset freeze so that only assets outside of Libya as on 16 September 2011 remain frozen.

The asset freeze has been an effective means of safeguarding the wealth of the Libyan people but it is not well understood in policy circles, with some assuming it amounts to a blanket freeze. Two main issues have arisen – first, the freeze targets some LIA assets but not others and with no clear reasoning, meaning many of the LIA’s subsidiaries, and the subsidiaries of those subsidiaries did not have their accounts frozen. Second, application of the freeze was uneven – and at times non-existent – in some jurisdictions which meant significant transfers of interest and dividends continued to be made.

Issue one: Subsidiaries

Subsidiaries illustrate the oddities of the terms of the freeze. For example, the LAIP is listed on the freeze but its subsidiaries, OilLibya (now known as Ola Energy), the Libyan Arab African Investment Company, and LAP Mauritius are not. This matters because the UN Panel of Experts, citing LIA internal sources, reported in 2013 that the ‘opaque nature of the ownership structure of the subsidiary hierarchy [of the LIA] was also a deliberate move by the former regime to facilitate the laundering of funds embezzled from the State to personal assets abroad’.

While overall valuations of the LIA’s assets are hard to reach, a large proportion of them are held within subsidiaries, some as tangible assets such as buildings but others as liquid assets – which make them a focal point for competition for control and a potential source of funding. The plight of LAP Green Networks, a subsidiary of LAP Mauritius, illustrates how management failures at within subsidiaries continued after 2011 despite the asset freeze.

By 2012, LAP Green Networks had invested more than $1bn in telecoms in six African states but was performing poorly. In October 2015, Hassan Bouhadi announced the ‘strategic consolidation’ of LAP Green Networks’ own subsidiaries within the Libyan Post, Telecommunications and Information Technology Company (LPTIC), thereby transferring the assets out of the LIA. He justified the move on the basis it would consolidate telecommunications holdings under one specialized management team.

Bouhadi says he believes LAP Green Networks would have gone into administration had LPTIC not taken over its assets. But the move does raise questions: why should Libya’s state-owned telecommunications company be directly running telecommunications agencies in other states? Questions over due process also arise. LPTIC says that the consolidation of LAP Green Networks into LPTIC was authorised by eastern authorities.

Yet a search on the corporate register in Mauritius in November 2020 indicated LAIP remains the owner of LAP Mauritius (which had been the holding company for LAP Green Networks). A search on the Dubai commercial registry indicated LAP Green Networks Dubai changed its name to LPTIC International Ltd, but not until January 2017 – some time after the supposed transfer of LAP Green Networks from LAIP to LPTIC.

LAP Green Networks is currently embroiled in a legal battle over its holdings. In 2012, Zambia nationalized Zamtel, 75 per cent owned by LAP Green Networks, allegedly without compensation, and the LIA claimed Zambia had sought to exploit instability in Libya to obtain the company. A UK court did order Zambia to repay $380 million in 2017, but – as of 2018 – LAP Green Networks said Zambia had yet to do so.54 Receipt of these funds would be a significant influx of cash for, presumably, LPTIC.

The LAP Green Networks example illustrates how the LIA’s large unfrozen subsidiaries continue to function with limited clarity over their operating procedures and almost no public disclosures.

Issue two: Interpretations of the terms of the asset freeze

Differing interpretations of the asset freeze’s terms when processing payments for supposedly frozen LIA accounts came to the fore during the ongoing investigation into transactions involving the Belgian bank Euroclear. LIA and LAFICO accounts in Euroclear were frozen in 2011 but the bank separated interest and other proceeds such as coupons and dividends from that point onwards, and these were made available to the LIA.

Documents provided by Euroclear to a Belgian parliamentary inquiry into the issue reportedly disclosed that €2.067 billion were transferred from Euroclear to LIA and LAFICO accounts in Luxembourg and Bahrain between 2011 and 2017, leading to important unanswered questions over what has happened to the funds. The UN Sanctions Committee believes such payments should have been subject to the freeze as per the provisions of UN Security Council Resolutions 1970, 1973, and 2009.

But the Euroclear case also raises serious wider questions for the international community over how major financial institutions operating in European jurisdictions could adopt divergent interpretations of the asset freeze for seven years resulting in significant flows of cash.

It is also notable that the change in policy from Euroclear did not come from any internal review process or regulatory decision but was a result of the process unleashed by evidence uncovered as part of the attempts by Prince Laurent of Belgium to recover funds he claimed were owed to him by Libya.

Back to the Future

The creation of the Government of National Accord (GNA) following UN-mediated peace efforts in December 2015 was intended to reunify Libya’s governing institutions, but it has failed. Bouhadi says he met with the GNA’s prime minister Fayez al-Serraj and invited him to appoint a new LIA chair and CEO, but no decision came. Bouhadi came under pressure from the eastern-based authorities who do not accept the legitimacy of the GNA and decided to resign in August 2016.

Serraj moved to appoint Ali Mahmoud as the new LIA chair and CEO while the eastern-based authorities appointed their own replacement. This left the LIA with three rival claimants to its throne – one associated with the eastern authorities, Breish who was appointed by the former Zidan government, and Ali Mahmoud, appointed by the GNA. Due process seemed to have collapsed and a flurry of litigation was unleashed once again, this time taking until July 2017 for the GNA to complete Mahmoud’s appointment.

There was also a struggle on the ground for control of the LIA headquarters in Tripoli with both Mahmoud and Breish seeking to remain in the offices. They even took turns ousting each other with Mahmoud asking security guards to escort Breish from the building in September 2016 only for Breish to return to the offices in February 2017 armed with a court order in favour of his return. Mahmoud eventually obtained control of the offices in May that year.

The legal muddle meant the armed groups in control of the LIA headquarters could in effect decide which leadership team would enter. Armed groups had long been able to pressure those within the LIA – Breish recalls up to 40 ‘militiamen’ entering his office in 2014 to demand employment, noting he was then briefly detained by them when he refused to accede to their demands.

Such developments provided context for the ongoing London-based proceedings over the contested leadership of the LIA – a somewhat bizarre spectacle whereby a UK judge sitting in a UK court was being asked to rule on the procedural validity of LIA appointments as laid out in Libyan law. The judge eventually ruled in March 2020 that the GNA resolution appointing Mahmoud was ‘incapable of being successfully challenged before the Libyan courts’.

Neither Mahmoud or Breish were in the courtroom when this verdict was delivered. Both were in fact in detention in Tripoli – apparently after yet another set of legal proceedings emanating from another of the LIA’s early investment decisions involving Palladyne International Asset Management (PIAM).

PIAM was appointed as an investment manager for $700 million of LIA, LAIP and Libyan Foreign Bank funds in 2007. Its CEO Ismail Abudher is the son-in-law of the late former Libyan prime minister Shukri Ghanem and, in 2013, the LIA became aware of investigations into concerns over allegations of possible financial impropriety by Abudher in the Netherlands, leading the LIA to refer the issue to its lawyers.

Abudher denied the allegations but in May 2014 the LIA board of directors removed PIAM due to concerns over the management of the funds. The LIA claimed the funds were under complete control of PIAM without representation of the original investors, questioned the fees charged by PIAM as excessive and identified payments to intermediaries to be reviewed.

PIAM challenged the decision to remove it in the courts in the Cayman Islands on the basis that it violated the asset freeze, and also brought proceedings against Ahmed Jehani and Ali Baruni, whom the LIA had appointed as replacement directors of the funds in 2014. In January 2019, the judge ruled in the LIA’s favour, noting that ‘concerns regarding the risks faced by the Libyan Investors in leaving the Plaintiff [PIAM] in control of the substantial investments held for the Libyan state were real and genuine… There were clearly a number of grounds for concern which included fees, performance and the absence or slow delivery of information’.

PIAM lost on all counts in the court of first instance and in the Cayman Islands Court of Appeals. PIAM then appealed to the Privy Council which has reportedly refused to hear the application.

The case had ripple effects in Tripoli and laid bare the administrative chaos. Following the release of the draft judgement in the Cayman Islands, the LIA removed the directors it appointed in 2014 and reappointed PIAM.

Mahmoud was subsequently arrested on 6 February 2019 on an arrest warrant issued by the Libyan prosecutor general. He would remain in detention until April when he was released and returned to his post. Breish was arrested soon after seemingly on charges relating to allegations of inappropriately using Libyan public money. He was also released in April and says all charges against him have been dismissed.

In Tripoli, the remaining members of the LIA board of directors subsequently denied knowledge of the decision to reappoint PIAM and voided the decision under the authority of its acting chair, only for the board of trustees to then rule the voiding invalid. Four new directors were then appointed to manage the investments instead of PIAM.

The LIA has explained its decision to re-appoint PIAM as an interim solution because the LIA-appointed directors ‘refused to recognize the authority of the GNA-appointed board of directors and could legally act without any board oversight’.

Yet it is difficult to understand why PIAM would be re-appointed and not another entity given the legal proceedings and the concerns arising from the allegations levelled at PIAM. Mahmoud said he is unable to comment on the Palladyne case as it remains ongoing in the courts.

***

PART (III)

Safeguarding a nation’s wealth

‘I took control under chaos’ said Ali Mahmoud when interviewed in January 2021. ‘I inherited a divided management and the LIA had lost control over many of its subsidiaries. There was a lack of information, no audit process and no risk management’.

Mahmoud said his plans for the near future include a programme of internal governance reform in coordination with Oliver Wyman, the conduct of valuation of LIA assets worldwide conducted by Deloitte, and an audit of LIA accounts conducted by EY. He also says a ‘mega-project’ will soon be initiated to consolidate financial statements for LIA funds and investment portfolios.

But despite clear goals, Mahmoud’s comments illustrate that almost ten years on from the ousting of Gaddafi, the LIA is still yet to adequately identify its assets and rationalize its management. The organization has now stated that, following the UK court decision in favour of Mahmoud, it can collect the requisite financial information from its subsidiaries and meet its financial reporting requirements.

But those with a close working knowledge of the LIA are sceptical whether this will happen to the desired standard. Ahmed Jehani says: ‘Although it was founded 14 years ago, the LIA has never published any consolidated accounts, audited or otherwise. There have been elements of the LIA that have produced accounts, but these are the exceptions.’

He argues this will undermine any auditing process as it is not the responsibility of the auditors to prepare accounts, and emphasizes the importance of establishing consolidated accounts which encompass all the LIA’s approximately 550 subsidiaries.

It also means any valuation of the assets made prior to that point could be fundamentally undermined. Abdulmagid Breish says it is relatively easy for the LIA to meet the standards in its own accounting but that the accounts of the subsidiaries need to move several levels up the scale in terms of accountancy practices for the LIA’s accounts to be properly consolidated.77

How much is the LIA worth?

Coming up with an accurate estimate of the value of the LIA is challenging for several reasons: firstly, the LIA does not possess ‘consolidated’ accounts for all of its subsidiaries. This means the value of these companies is in some cases stated as their original ‘book value’, i.e. the amount of investment placed in the company at the outset. This does not account for issues such as asset depreciation or appreciation.

Secondly, the interconnectedness of institutions makes it unclear who owns what. Many LIA entities are jointly financed by other Libyan state institutions. Oilinvest, for example, is jointly owned by LAFICO, the Libyan Foreign Bank (state-owned) and the Libyan National Oil Corporation. A significant sum of LIA cash – around $18 billion – is held at an account within the Central Bank of Libya, but the management of these funds is unclear. The LIA has also reportedly issued loans to a number of its subsidiaries and other state institutions.

Finally, the December 2020 decision to change the official exchange rate of the Libyan dinar to the US dollar

(from 1.4 LYD = 1 USD to 4.48 LYD = 1 USD) significantly affects the dollar valuation of LIA assets held in Libyan dinars. This is notably the case for the Libyan Local Investment and Development Fund, which had its approximate $8 billion of funding transferred into dinars.

Existing estimates of LIA assets seem to remain based on a $67 billion valuation in 2010. In 2016, the UN Panel of Experts concluded that frozen assets had declined in value from $65 billion to around $55-$60 billion. Experts interviewed for this paper projected the LIA’s subsidiaries had declined in value. They note that the historic book value for the subsidiaries ($24.5 billion) is outdated. A 2015 valuation by the Libyan Audit Bureau placed the value at $14.5 billion. The result is significant uncertainty. The LIA says it is soon to publicly release a valuation of its assets.

The next objective for the LIA is to seek amendments to the terms of the asset freeze. A report it commissioned announced in December 2020 that the LIA’s equity investments have underperformed market averages to the tune of $4.1bn since 2011. The LIA complains significant funds are being held in negative equity while investments in bonds that have matured are converted into cash without being reinvested.

The LIA says it is seeking ‘feasible ways to more actively manage’ its portfolio. Although not seeking the removal of the asset freeze, it has prepared a set of proposals to amend the freeze through the creation of a ‘special purpose facility’ under the management of a custodian institution – likely still to be subject to the oversight of the sanctions committee in some fashion. This, argues Mahmoud, would ensure the asset freeze serves its function of protecting, rather than punishing, the LIA and its assets.

But several former senior employees of the LIA have rejected any amendment of the asset freeze, with most suggesting it be strengthened instead. Such a view emphasis the need for the LIA governance to first be improved before the terms of the freeze be considered for change.

In lieu of a change to the asset freeze’s terms, there also remains the potential for the LIA and its subsidiaries to obtain licenses to operate in international jurisdictions. Ali Baruni rejects the argument that licences to operate existing holdings are too difficult to obtain – and in fact, a number of LIA subsidiaries have obtained licences to navigate the freeze such as FM Capital Partners in London.

Next comes the question of how the LIA should position itself for the future. Here, a root and branch reform of the LIA to steer it away from directly managing assets would be in keeping with the operations of other major sovereign wealth funds. Mohsen Derregia highlights the example of LAP Green Networks, where the LIA tried to run a complex telecommunications business in African countries when it could have subcontracted the task to an operator experienced in the sector. Similar examples include managing hotels in Tunisia and office buildings in London.

Among former employees of the LIA, there is a strong sense that the LIA should be an owner not a manager. Rather than being encumbered with the administrative challenges of operating 550 subsidiaries, it would be better served by placing its investments strategically with external fund managers, who can be held to clear performance targets and fired if they perform poorly. The LIA has proven it can do this – the Corinthia hotel chain is part-owned by the LIA but operated by a third-party. Breish says that a report he commissioned from Oliver Wyman in 2014 recommended liquidating 85 per cent of LIA assets.

Removing direct management of the subsidiaries would also reduce potential opportunities for corruption via dispensation of paid positions and contracts. There are various stories of LIA subsidiaries creating their own subsidiaries and refinancing that have not been substantiated. Derregia likens such a process to a ‘Russian doll effect’ because it can help sustain patronage networks.

At times of political upheaval, the cash of the LIA and its subsidiaries can be an enticing potential target for political interests. The dysfunction in Libya and the ongoing competition is so severe that Breish believes the LIA should be ‘totally wound down, [its assets] placed in a fund and accessed in 25 years’.

Regardless of the approach the LIA chooses for the management of its assets, a focus on returning to the strategic priorities outlined at its inception is certainly required – namely to invest the wealth of the Libyan people and to reduce its vulnerability to shifts in the global oil price and dependence on the oil sector. These remain priorities for the Libyan state.

The international community’s approach to freezing assets, developed in the early months of the 2011 uprising, has endured by default because the LIA has not been able to make the case for lifting the freeze. The international community has lessons to learn as illustrated by the inconsistencies in the application of the terms of the freeze and the lack of enforceability in some jurisdictions.

There is an opportunity for the UN Security Council to clarify its stance and remove inconsistencies that linger from previous resolutions over which entities should be affected and which should not. It should learn from the experience of the last decade to seek to close loopholes that have allowed funds to continue flowing to some parts of the LIA but not others, most notably its subsidiaries.

But amendments to the freeze should be contingent on the LIA first delivering on its stated aim of improving the governance and transparency of its holdings. If not, then states whose courtrooms have witnessed a raft of LIA-related litigation, should seek their own clarifications from the Sanctions Committee to reduce the potential for error and avoid any allegations of complicity being levelled at them.

Finally, the asset valuation currently being conducted for the LIA offers a valuable opportunity to bring some clarity and transparency to the fore. Presenting the findings of the assessment to the Libyan people to explain where their assets are being held and their value is a necessary first step in any reform process. The international community should encourage the public release of LIA financial information, especially with regard to subsidiaries operating within their jurisdictions.

***

Tim Eaton is a senior research fellow with Chatham House’s MENA Programme. His research focuses on the political economy of the Libyan conflict. In 2018, he authored a report on the development of Libya’s war economy which illustrates how economic activities have become increasingly connected to violence.

Libya: Chaos Continues

January 3, 2022
Miral Sabry Al Ashry


Postponing elections in Libya means more chaos, as the Libyan parliament postponed a vote on how to deal with the repercussions of postponing national elections after a chaotic session that reflected the fabricated political crisis over the fate of the peace process and instability.

The Libyan people still want the installation of a new president and parliament with national legitimacy. But given the contested candidates, political factions, and politicians over how long the elections should be postponed, possibly on January 24, 2022, and whether the interim national unity government headed by Prime Minister Abdel Hamid al-Dabaiba, can continue.

In addition, the problems are not addressed; it will be impossible to hold elections on that date, and this is what the stakeholders want. It is possible that Prime Minister Abdulhamid al-Dbeibah should not have been allowed to run for president after he promised when he took office that he would not do so. But it is possible that he would change his mind like what President Sisi did in Egypt in an attempt to save society.

The Egyptian strategy was represented in a fabricated crisis that cannot be reformed, and then a new trend rose to power and the media promoted it as the savior of Egyptian society from the Muslim Brotherhood. But in Libya, there are fabricated crises such as lack of energy and salaries and weak infrastructure. All of these crises make former political factions try to reach authority and that it is unfair for Abdulhamid al-Dbeibah to participate in the elections while he is still prime minister.

The main focus should be on elections and the democratic transition to bring the country back, not on the fate of the national unity government. However, there must also be an ‘equal opportunity and no candidate should have an unfair advantage and there must be an electoral platform while in an official role.

There is a crisis in the illegal immigrants appeared where he found the bodies of more than 15 bodies, including the body of an infant that was recovered from the shore who drowned while trying to cross the Mediterranean to Europe and three survivors said that in total there were 35 people on board their boat that sank. Libya is a major transit point for illegal immigrants as a result of illegal dealings from the coasts, and this is an attempt to attract many African countries, which are looking for better job opportunities in Europe.

The situation in Libya seems likely to lead to more political instability, despite the steps taken by the Interim Government of National Unity and the Presidential Council in different and perhaps contradictory directions. The ongoing conflict is linked to external participation since 2011 and what the international community and the United Nations have done.

***
Miral Sabry Al Ashry is an Associate Professor at Future University (FUE), Political Mass Media Department.

Democrats Grope for Path Forward on Biden’s Economic Agenda

Erik Wasson and Laura Davison, Bloomberg News

Joe Manchin Photographer: Al Drago/Bloomberg , Bloomberg

(Bloomberg) -- Senate Democrats begin the new year Monday groping for a path forward on President Joe Biden’s stalled domestic economic agenda, hoping to pass a slimmed-down version before midterm election campaigns begin.

Senate Majority Leader Chuck Schumer is vowing to bring a revised version of the $2 trillion tax, climate and spending package to the floor for a vote as soon as this month, despite unresolved differences within his party that have stalled the legislation.

Schumer’s strategy still faces a major roadblock from West Virginia Senator Joe Manchin, who stunned Biden and fellow Democrats in late December by saying he wouldn’t support the House-passed bill and was walking away from negotiations.

To gain Manchin’s support, Democrats will need to re-imagine their wide-ranging social policy bill that funds health care initiatives, climate programs and new supports for children and families. Revising the bill will require scaling back some elements and cutting other programs entirely. 

Congressional Progressive Caucus Chair Pramila Jayapal, a Washington Democrat, said on MSNBC Sunday that it’s urgent for the Senate to pass a version of the Build Back Better plan that Manchin can support. She said she believes it is still possible to pass a bill based on an outline Manchin and Biden negotiated prior to the House passing its $2.2 trillion bill.

“He said that he just can’t do the bill that we passed out of the House,” she said. “As you remember we added some things that were not in the framework.”

The House, for instance, added a paid leave provision. That bill also has Medicare hearing benefits that Biden put in his framework even though Manchin had never formally supported them.

Jayapal estimated that less than 10% of the House bill deviates from the Biden framework and urged the Senate to work quickly.

The economic package, universally opposed by Republicans, was supposed to be the centerpiece for Democratic campaigns as the party fights against long odds to maintain control of the House and Senate. Its components are popular in polls, especially an extension of the child tax credit that expired in December.

Progressive Democrats in the House, who for months have been at odds with Manchin and Arizona’s Kyrsten Sinema, the Senate’s other Democratic holdout, are pressing Biden to use executive action to achieve some of the legislation’s goals. But that tool has very limited applications and both sides must come to terms with what can pass with such narrow Democratic majorities in the House and Senate. 

Manchin has said he’ll only support up to $1.75 trillion in spending paid for by tax increases on high earners and corporations. 

Among his chief concerns is the impact of federal spending on inflation. So the consumer price index report due out Jan. 12 will be a key indicator for the direction of the debate after December’s report showed prices up 6.8% year over year. 

Democrats in any case plan to argue that the bill will actually bring down inflation in the long term because of provisions to lower health care and child care expenses.

“We know that BBB is the best tool we have to bring down the biggest cost families face: housing, child care, and health care – all while creating good-paying union jobs. I will work with my colleagues to enact the goals of BBB into law,” Senate Banking Chairman Sherrod Brown said in a statement. 

The White House, which Manchin accused of bullying, will attempt to woo the senator in the coming weeks. Manchin gave Biden a $1.8 trillion counteroffer before walking away from the table, which could form the basis of a future deal.  The senator suggested scrapping expanded child tax credit payments and focusing instead on universal pre-kindergarten, renewable energy tax credits and expanded Obamacare subsidies. 

Manchin has two sets of demands that will be especially hard for Schumer and Biden to meet. 

One is that each program bolstered in the bill must retain the same level of funding for at least 10 years. The bill as structured cuts off programs like the child tax credit expansion after one year, in the hope that a future Congress will extend it and come up with a new revenue source. Extending the credit for a full 10 years could cost $1.6 trillion, leaving room for little else under Manchin’s specified topline of $1.75 trillion.  That creates a political problem with progressives, especially in the House, who want a panoply of programs in the bill. 

Manchin also demands the bill do more to reverse former president Donald Trump’s signature 2017 tax cuts. Manchin supports raising the corporate tax rate to 25%, which the White House and House Democats would also endorse. But Sinema opposed raising the corporate tax and hiking rates on top-earning individuals. Instead, the bill creates a 15% corporate minimum tax that some Democrats acknowledge will be difficult to implement and enforce. 

Manchin also wants to give the government’s Medicare program broader ability to negotiate drug prices, which Sinema also has opposed. 

“If you’re going to negotiate then negotiate. Don’t start picking and choosing and playing games,” Manchin said of the drug provisions. 

Schumer is looking to create a deadline for the ongoing talks with Manchin by forcing votes on the package in January, but it is not clear yet if that deadline will come and go just as Schumer’s Christmas deadline did.

“We are going to vote on a revised version of the House-passed Build Back Better Act -- and we will keep voting on it until we get something done,” Schumer said in a letter to his colleagues at the beginning of the two-week recess. 

House Role

The House is out until the week of Jan. 10, but moderates there are urging Schumer and the White House to focus on a few key priorities and extend them for 10 years. They differ from Manchin in viewing the child tax credit as a must-have. 

“Our priorities were the child tax credit, making sure we have a large investment in fighting climate change, and making sure that we keep the Affordable Care Act premium subsidies in place and address the coverage gap,” House New Democrat Coalition Chair Suzan DelBene said Dec. 21 on the PBS NewsHour. 

The Congressional Progressive Caucus, on the other hand, is advocating working off of the House-passed draft and having Manchin specify which programs he specifically objects to. 

Jayapal said Sunday that passing the bill is key to showing the public that Democrats can govern. 

“Joe Biden and Democrats need to succeed in showing Americans we can get stuff done,” she said. But because it is “unclear” how long the Senate would need, Biden should take executive actions where possible, Jayapal added. 

©2022 Bloomberg L.P.

RIGHT WING WATCH

Pro-life group convinces 34 Christian universities to stop promoting Planned Parenthood

THE ATTACK ON PP IS BECAUSE THEY PROVIDE BIRTH CONTROL

RACHEL LALGIE - UNIVERSITY OF FLORIDA •JANUARY 3, 2022

‘As an organization on more than 1,250 campuses in all 50 states, we are going to keep going back until we have built a culture of life on campuses nationwide’ Students for Life says

Students for Life of America has succeeded in less than a year in convincing 34 of 103 Christian universities with ties to the abortion industry to sever the connections.

The national pro-life student organization launched its initial list of 25 schools in March and said it wanted to disrupt the “unholy partnership” between Planned Parenthood and Christian universities.

The Christian Schools Project identified 103 religious universities, out of 784 total with some Christian-affiliation, that promoted Planned Parenthood or the abortion industry in some way.

Students for Life contacted the 103 universities twice over email and once through a phone call to give the universities an opportunity to remove the Planned Parenthood content before the report came out in December.

The most frequent infraction, according to SFLA, is that the university lists Planned Parenthood as a resource for students or encourages internships at the nation’s largest abortion vendor.

This tells students that abortion is a good option if they are pregnant, SFLA told The College Fix.

“When a Christian university is promoting the nation’s largest abortion vendor to that vendor’s target clientele, it is reinforcing the mistaken notion that women cannot finish school or succeed in life with a child and failing to provide the spiritual formation and tangible support,” spokesperson Lauren Enriquez told The Fix via email.

“Planned Parenthood has spent a lot of money convincing women that they can’t multitask a successful life,” Enriquez said.

The next step is to work with the 69 schools that still maintain connections to the abortion industry to convince them to end the relationship and promotion of Planned Parenthood.

“Now we are enlisting the public’s help to address the remaining 69 schools,” Lauren Enriquez told The Fix. “As an organization on more than 1,250 campuses in all 50 states, we are going to keep going back until we have built a culture of life on campuses nationwide.”

Comprehensive review includes if the university actively supports pregnant, parenting students

Students for Life ranked all 784 universities from A+ to F based on how many criteria fit each university, such as Planned Parenthood provided as an internship, student resource, or career opportunity.

A+ represented universities with no relationship to Planned Parenthood and a deliberate attempt to help pregnant and parenting students.

The Fix reached out to two A+ universities, Abilene Christian and Liberty, but did not receive a response. The Fix asked both schools on December 17 and 21 why it was important to them to not have ties to Planned Parenthood.

Three F rated universities, which list Planned Parenthood as a student health resource, did not respond to requests for comment. The Fix asked the media relations team for Emory University, Macalester College and Rhodes College if the schools planned to address the relationships with Planned Parenthood, if they see any conflict between Planned Parenthood and Christianity, and if they ever encourages students to have abortions, but received no response.

Catholic universities represented the largest portion of the 34 universities to cut ties with Planned Parenthood. Students for Life originally identified 22 problematic Catholic universities, but that number has been reduced to 8.

Enriquez told The Fix that some of the colleges removed the Planned Parenthood content without notifying Students for Life. “We learned that they had cut ties thanks to our ongoing research.”

MORE: Abortion activists disrupt pro-life conference at Pitt

Editor’s note: College Fix associate editor Matt Lamb worked on portions of this project while an employee of Students for Life of America and Students for Life Action.