Libyan wealth fund aims to unfreeze billions of dollars in assets

Libya’s sovereign wealth fund will appoint auditors within weeks and conclude a wide-ranging examination of its assets by 2019 as part of its efforts to get billions of dollars of assets unfrozen, the fund’s head told Reuters.

Ali Mohamed, the chairman and chief executive of the Libyan Investment Authority, said PriceWaterhouseCoopers was one of the companies the fund was considering.

About 70 per cent of the LIA’s $67 billion worth of assets have been frozen under United Nations sanctions since the toppling of Moammar Qaddafi in 2011 pushed the country into turmoil.

UN diplomats say they want to see a stable government in Libya before relaxing the sanctions.

“We want to strengthen the trust of the international community in the Libyan Investment Authority,” Mr Mohamed said. “We are co-operating with the United Nations and adhering to their sanctions.

“We are making reforms from top to bottom and carrying out an audit that can be used by the UN to check the assets of the LIA,” he said, speaking through a translator.

Libya’s economy has collapsed, and the fund could eventually be an important source of finance for the wartorn country. But it has long been hampered by a leadership dispute between rival factions in Tripoli and eastern Libya.

Mr Mohamed said he ended some of those divisions by merging departments and offices.

“We need to enhance our governance. Political splits damaged the Libyan Investment Authority. Our assets were frozen in order to protect them,” he said.

Asked about reports on funds that had been transferred out of European bank accounts linked to LIA, Mr Mohamed said that stemmed from dividends and interest paid on holdings of equities and fixed income instruments. The asset freeze only applied to the equity itself or the principal of the bonds, he said.

“These revenues from equity dividends are worth hundreds of millions every year. We have received those since 2011,” he said, adding more than $1bn had been transferred to LIA’s accounts at Arab Bank Corporation in Bahrain from custodian bank accounts in Belgium and Luxembourg since 2011.

“Money withdrawn from ABC bank was used to pay for the operational costs of the LIA. We have statements dating back to 2011,” he said, adding he had full control over the accounts and no money had disappeared.

About $8.5bn of LIA’s assets were invested in global equities and some $1.5bn in bonds, according to Mr Mohamed.

He also said the fund’s staff in Tripoli had now moved out of the Tripoli Tower office block to a different, undisclosed location amid security breaches.

UN diplomats say they want to see a stable government in Libya before relaxing sanctions