Libya: the battle for peace in a failing state

Hope grows that a renewed diplomatic effort can unite warring factions in the oil exporting country

For the past four years, Mustafa Sanalla has had a frontline view of the damage wrought on Libya as armed groups have carved up the oil-rich north African state into a patchwork of fiefdoms.

As chairman of National Oil Corporation, he has faced a constant battle to keep the crude flowing while militias have repeatedly fought over oil facilities that are the country’s economic lifeline. His staff have been murdered and kidnapped. In September, he had to smash a window in his fifth-floor office in Tripoli as smoke poured in under the door, to escape a deadly attack by Isis.

More recently, tribesmen and members of the Petroleum Facilities Guard — the armed force that is supposed to protect oil facilities — shut down the El Sharara field, the country’s largest. The unrest, ostensibly over pay and the dire state of government services, began in early December and has been costing $32.5m a day in lost output. The result is that the $100bn in revenues and damage Mr Sanalla estimates has been lost due to attacks on Libya’s oil facilities in the past five years keeps totting up.

“It’s a very difficult job unfortunately,” Mr Sanalla says. “The lack of unity and accountability is holding us back significantly, as demonstrated in Sharara — they are the people supposed to protect us, not cost us millions.”

For eight years, Libya has been emblematic of the failure of the Arab spring: the crushed hopes of restive, youthful populations and an example of lost opportunities. The forces that rose up with Nato’s backing failed to fill the void created by the overthrow of Muammer Gaddafi’s regime. Instead, the country broke up under rival governments in the east and west, with competing factions fighting over the spoils of victory.

Now, as international attention intensifies on the failing state amid longstanding concerns about the flow of migrants to Europe and the risk that Isis fighters being forced out of Syria will seek to exploit the chaos, the UN is leading a fresh drive to bring stability to the Opec member. It has set an ambitious target of holding elections in the spring, with the aim of bringing the fragmented society under one central authority for the first time in years.

Success would mean that Libyans could have a chance to finally use the nation’s rich resources to begin the process of rebuilding a shattered state. Failure would threaten more conflict.

Mr Sanalla, a chemical engineer, took over as NCO chairman in 2014 as the country was sliding towards civil war, sees the looting and smuggling in the oil sector as a “plague that is eating away the fabric of our society”.

But he also knows the potential should the situation stabilise. Emboldened by his success in ramping up crude production from about 200,000 barrels a day to just over 1m b/d, his target is to increase output to 2m b/d with a $60bn five-year investment plan. He also hopes to launch the first exploration licensing round in more than a decade, and lure more oil majors to join the likes of Total, Conocophillips and Eni to the country.

“If we have the right election, I think we’ll have the right people to solve the issues,” Mr Sanalla says. “Without transparency, without fighting the smuggling, it’s very difficult to have any solutions.”

The man with the job of leading diplomatic efforts, the UN envoy Ghassan Salamé, acknowledges that reconciliation in Libya can look like an “impossible” mission. He must grapple with competing politicians obstructing elections; militias that thrive and profit on the chaos; and interference from foreign powers with conflicting priorities.

The impetus for the renewed diplomatic push came after Tripoli endured its worst violence in years as militias fought month-long street battles in the capital in August and September.

The carnage exposed the impotence of the Government of National Accord in Tripoli. But after securing the ceasefire that ended the violence, the UN mission believes that it could prove a turning point that forces politicians to accept the need for change.

Three years after the GNA was endorsed by the UN Security Council as the legitimate authority, the UN’S efforts now depend on it convincing rival Libyan leaders to support a national conference that would pave the way for the polls. Mr Salamé believes there have already been tentative signs of progress, such as the appointment of a new interior minister and efforts to overhaul security in Tripoli.

After the fighting in Tripoli weakened the GNA he says it is “much more willing to listen to us” and has passed reforms. A key measure was imposing a 183 per cent tax on foreign currency transactions, which has in effect devalued the dinar and narrowed the yawning gap between official and black market currency rates. This has eased a crisis that forced Libyans to queue for hours at banks just to get their hands on a few hundred dinars. It also curbed the ability of warlords to reap huge profits from the black market by extorting dollars at the official rate from banks.

Yet it is not just the estimated 200,000 militiamen on the state payroll who present a possible hurdle to a settlement. Instead, Mr Salamé points to a political class that has grown wealthy amid the chaos.

“You need a bulldozer to take him [a politician] from his chair. It’s very, very difficult,” he says. “The idea of elections, the idea of replacing somebody with somebody else, is viewed as aggressive.”

Or, as one regional official puts it, the status quo allows them to have “power and access to money to appease their constituencies”.

As for the gunmen — the UN estimates there are 15m-18m weapons in a country of 6.5m people — the realistic option is not to attempt to force them to give up their guns, but to “persuade those who hold them to keep them silent”, Mr Salamé says.

The risk is that an election acts as a spark for renewed violence. Many of the country’s problems are traced to the previous vote in 2014. Turnout was below 20 per cent, the results were contested, the process deepened divisions and conflict ensued. The establishment of the GNA, led by Fayez al-sarraj, prime minister, as part of the Un-backed political agreement in December 2015, was intended to bring stability. But in many respects that project was stillborn.

The GNA remains beholden to militias and struggles to exert influence beyond the capital. Khalifa Haftar, a military strongman who controls much of the east and commands the self-styled Libyan National Army, refuses to recognise it. A parliament in Tobruk is similarly dismissive of the Un-backed government and aligns itself to Mr Haftar and a parallel “interim government” in the eastern city of Bayda.

The malaise has left the country with competing factions claiming authority over key state institutions, including the central bank and the Libyan Investment Authority, the sovereign wealth fund with more than $60bn of assets.

Libya must also contend with the resurgent threat of Isis. The group’s Libyan branch was driven out of its stronghold in Sirte in 2016 by local forces backed by US air power. Several people were killed last month when Isis attacked the foreign ministry in Tripoli.