Council Members

The LBBC Business Risk Advisor

Libya is experiencing a period of unprecedented transition. As the country embarks on a programme of national reconstruction and actively seeks foreign partners to supply the necessary products, services and expertise, the potential trade and investment opportunities for LBBC members are exceptional.

LBBC Business Risk AdvisorNevertheless, despite these positive developments, the political and security outlook for the country remains uncertain: the long-term stability of the new governing authority, socioeconomic pressures on the Libyan people, potential religious and ethnic tensions, and the continuing influence of armed militia on the democratic process - all of these factors and more may impact upon the Libyan business environment.

Understanding the current risks associated with doing business in Libya and being able to accurately forecast how the prevailing political and security situation may influence business variables, such as export payments and investment returns, are invaluable attributes for any commercial operation.

The LBBC's new risk advisory digest aims to provide our members and clients with access to relevant, current, and actionable information and informed opinions which they can draw upon when making commercial decisions.

The reports, extracts and links listed below contain strategic advice which will help LBBC members to manage their operational risk and minimize uncertainty with respect to their Libyan business interests and their commercial plans going forward.

This new online service also aims to highlight the broader range of products and services offered by LBBC members that operate in the fields of business intelligence and risk management and to showcase their expertise to an audience that may benefit from a more direct relationship.

We are confident that LBBC members - both experienced Libyan operators and businesses new to the Libyan market - will choose to explore further the strategic advice offered by some of the information providers contributing to this service.

Bloxtons

Bloxtons provides fully bespoke risk management and corporate intelligence services. Through our corporate intelligence services we allow clients to make the most efficient use of their time in country, enable access to interlocutors otherwise not possible and provide thorough screening and due diligence capabilities. In Libya we have established strong relationships with government entities as well as a wide range of non-governmental actors across all regions.

Operating in any fragile environment can be challenging; Bloxtons allows companies to go about their daily business with the minimum interruption whilst ensuring complete duty of care compliance. Some of the services we offer include: full in-country security analysis and briefing; bespoke research and analysis products; re-entry planning; country wide evacuation contingency planning; 24/7 emergency response and tracking; due diligence and investigations.

For further information on the risk management and corporate intelligence services Bloxtons can provide to you and your clients please email enquiries@bloxtons.com or call our UK office +44 (0)20 3239 3363.


Links:

Libya Weekly Strategic Update - 26 September 2014:

In a week that has seen continuing difficulties for al-Thinni in forming a government this weeks' strategic Libya update from Bloxtons considers the potential for mediation. In addition this week’s oil report (available here) explores the continuing concerns regarding oil revenue distribution and the control the GNC may attempt to exert.

Bloxtons have a permanent presence in Libya and support movements in and out of the country, conduct advance re-entry planning, provide bespoke political and sector analysis, and act on behalf of clients in commercial matters. To discuss how Bloxtons can support your work please contact us by email at enquiries@bloxtons.com or call our UK office +44 (0)20 3239 3363 or Australian office +61 (0)3 9028 2873.  Please visit www.bloxtons.com to subscribe directly.


Regional update

Tripoli and the West
Petrol shortages continue in the capital but with queues typically lasting for hours rather than days as was seen earlier in the year.  More disruptive have been the server power cuts that have affected all areas of Tripoli. These have on occasion lasted over 16 hours, although more typically are for between 6-12 hours. The power cuts have a detrimental effect on mobile phone communications with the cell towers only able to provide a limited voice capability at best during power cuts.  Bloxtons use a multi-layered approach for communications and client tracking which includes satellite based communications and tracking systems as well as multiple redundancy power supplies. This ensures client safety is maintained at all times and allows clients to continue to work effectively.

Muhammad al-Ammari, the director of the office of the Deputy Governor of the Central Bank of Libya (CBL) was kidnapped in Tripoli, an event that may be linked to the current dispute regarding governance of the CBL. The Deputy Governor Ali al-Hibri is supportive of the HoR and had previously attempted to ensure they had access to funds.

Fighting with Warshefana continues to the East of Tripoli with those travelling to Tunisia by land now having the option of using a helicopter or boat service from Zuwara to Tripoli in order to avoid the area of fighting.

The East
Whilst the fierce fighting seen in previous weeks and the aerial bombardments have both reduced drastically there has been a notable rise in assassinations in Benghazi. On Friday 19th alone there were ten confirmed assassinations in Benghazi. The previously reported kidnapping of a bank manager in Benghazi was reportedly brought to an end after a ransom was paid. A Ukrainian doctor and his wife were also reported to have been kidnapped in the town.

In this week's oil report we look at oil infrastructure in the east and continuing concerns regarding oil revenue distribution.

Political Analysis

Libya’s predicament continues to worsen, but at the same time, the deepening quagmire brings with it some clarity which may help identify a way to resolve the crisis. On the one hand, the domestic political situation is becoming increasingly detached from reality. On the other hand, the Libyan crisis has attracted greater international attention and there seems to be a genuine effort on multiple fronts to promote dialogue among the clashing factions.

The House of Representatives (HoR) continues to spin its wheels in internal exile in Tobruk. The body has become so ridden with internal disputes (even though it can hardly project power beyond the floating hotel where it meets) that it cannot agree on Prime Minister Abduallah al-Thinni’s proposed cabinets. Al-Thinni has submitted two cabinets which have both been rejected by the HoR. Al-Thinni has been told he has just one more opportunity to submit a successful cabinet or he will have to resign and the HoR will elect another prime minister. It is unclear if the threat has teeth especially as there is no guarantee that whoever were to be appointed next as prime minister would be able to submit an acceptable cabinet either.

Meanwhile, the Misrata-led Alliance (MLA) in Tripoli continues to try to adopt the trappings of a government even though it has not domestic or international mandate. It has now appointed a Minister of Oil and Gas and in addition, former GNC president Nouri Abusahmain is undertaking diplomatic missions to rally support for his “government.”

But even while domestic political wrangling continues and while fighting persists, there appears to be increasing willingness on different sides of the conflict in Libya to enter into negotiations, even if only to create the impression that they privilege dialogue over confrontation. Talks were held in Madrid last week with representatives of the HoR and Libya’s neighbours, but excluded any of the factions with which the HoR is struggling. The United Nations International Support Mission in Libya (UNISML) also announced that it has set talks for all parties to the conflict on 29 September, but it remains to be seen if this date will hold and if all parties will indeed still be willing to participate.

One of the sticking points regarding negotiations is the appropriateness of including Libya Dawn representatives and members of the former government in discussions. After all, Libya Dawn has refused to recognize the legitimacy of the HoR and the former government has recreated itself precisely to challenge the authority of the HoR.

Here Algeria has struck out in a new direction. In comments in Washington, DC last week, Algerian Foreign Minister Ramtane Lamamra said that Algeria is prepared to mediate the Libyan crisis, but that it would require engaging all parties including Islamists and former Qadhafi supporters. While Algeria’s approach is likely the right one, it is very unlikely to gain traction in Libya. Libyans still harbour a profound distrust of Algeria, first for not rushing to support the 2011 rebellion, and second for welcoming some of Qadhafi’s family members as refugees on humanitarian grounds.

At the end of the day, though, talks may simply be for talks’ sake, with all parties trying to show a willingness to engage in dialogue, if only to create the appearance for their constituencies that they are not intransigent and opposed to peace.

To discuss how Bloxtons can support your work in Libya please contact us by email at enquiries@bloxtons.com or call our UK office +44 (0)20 3239 3363 or Australian office +61 (0)3 9028 2873. 


Salamanca Risk Management

SRM has been delivering risk management services in Libya since February 2011.  Initial operations involved logistic support to media teams reporting on the Revolution.  From November 2011, SRM capitalised on the experiences of its Country Manager and consultants and assisted a number of major international companies to re-establish their businesses.  


SRM maintains a permanent footprint in Tripoli comprising the Country Manager, an experienced Arabist operations’ team and a number of Libyan facilitators.  A separate office is retained in Benghazi.  Long-term projects in Tripoli, Khums, Birak and Sebha enable SRM to maintain excellent coverage of the nationwide security environment.  Routine enabling support is provided for a wide range of commercial sectors across Libya, including management services, construction, energy, education, media, defence and NGOs.  

SRM is fully licensed to operate in Libya and is in partnership with a Libyan security and risk management company giving strategic reach and insight into key areas of the Libyan Government at national and regional level.  

Links:


Khalifa Hifter Briefing [Friday 23 May 2014]

1 Background 

Khalifa Hifter (‘Hifter’) was born in Benghazi and served as one of Gadhafi’s senior commanders during Libya’s disastrous conflict with Chad during the 1980s. He and several of his men were captured by Chadian forces in 1987 and subsequently disowned by Gadhafi, a policy adopted towards all Libyan prisoners of war. Hifter then went into exile in the US, where he lived for around 20 years in northern Virginia. His proximity to the CIA headquarters in Langley during this time has led to speculation he may have developed ties with the US intelligence community. 

In February 2011, Hifter returned to Libya to take part in the civil war. Although some sources named him as the commander of the rebel armed forces, the National Transitional Council, then the temporary governing authority, denied this and instead afforded the title to Abdel Fatah Younes. Hifter was nonetheless given the rank of Lieutenant General by the NTC, making him officially the third most senior rebel commander. Hifter did not play a significant role in the transitional governments following the revolution, instead returning to his tribal heartland in eastern Libya. 

2 Operation Libyan Dignity 

2.1 Background 
In February 2014, Hifter returned to the public spotlight when he made a televised announcement calling for the suspension of the General National Congress (‘GNC’). However, this action did not garner widespread support; Ali Zeidan, then the Libyan Prime Minister, dismissing his statement as “ridiculous”. However, on 16 May, Hifter re-emerged, this time with 
the backing of several Libyan army units as well as at least two Mirage air force jets, and announced the commencement of Operation Libyan Dignity. 

2.2 Benghazi Assault 
Hifter initially framed Libyan Dignity as a military operation targeting extremist groups in Benghazi - principally Ansar Al Sharia and the February 17 Brigade. The GNC quickly denounced the operation as illegal and called on all army personnel not to take part. It became apparent that the operation had broader aims when on 18 May, Zintani militia brigades stormed the GNC building and captured seven representatives who they claimed were supporting eastern extremists. Although these Zintani militia denied they were acting under Hifter’s direct orders, they did express solidarity with Operation Libyan Dignity. Over the past few days, various government and military officials have pledged their backing for Hifter and Libyan Dignity, whilst the Libyan Muslim Brotherhood has predictably condemned his actions as a military coup. 

2.3 Hifter’s Intentions 
On 20 May, Hifter gave an interview to the Washington Post in which he claimed that Operation Libyan Dignity had been planned over the past two years in response to the assassination and kidnapping of various military and security officials in Benghazi. Hifter added that the aim of Libyan Dignity was to re-establish security in the country, and that he intended to create a unified national army and police force. 

On 21 May, Hifter outlined his plans for a political transition, calling for the GNC to be dissolved and the current government dismissed. He indicated that Libya’s top judicial council should appoint a temporary government to oversee the next elections, with the 60-member constitution committee acting as the government’s legislative arm. On the same day, Habib Lamin, the Minister of Culture, announced his support for Hifter’s plan and stated he no longer recognised the GNC’s legitimacy. Similar announcements by other ministers and GNC delegates are possible over the coming days. 

2.4 Government Response 
As noted above, the government and most delegates within the Islamist and Misrata-dominated GNC have condemned Operation Libyan Dignity as illegal. However, there appears to be a recognition that the GNC in its current form is unsustainable, given the substantial public backing for Hifter. Accordingly, on 20 May, the GNC held an emergency meeting at the Radisson Blu Hotel in Tripoli to seek a solution to the political crisis, resulting in proposals to hold 
elections at the end of June for a new interim legislature and a rerun of the controversial prime ministerial vote won by Ahmed Maetiq. However, after these proposals were announced, it was reported that the GNC meeting failed to reach quorum, and it is unclear whether the measures will be enacted. 

For his part Maetiq has refused to step down, stating in a press conference that “Libyans don’t want to return to having a military body rule them”. 

2.5 Possible Consequences 
Operation Libyan Dignity has yet to develop into a large-scale conflict, despite the clear risks involved in attempting to overhaul the country’s political process. In particular, the restraint exercised so far by the Misratan brigades in not retaliating against the recent Zintani militia movements has prevented widespread clashes from occurring in Tripoli. However, the potential for further violence remains high, particular as Hifter has employed divisive rhetoric in outlining 
his vision for the political transition. Hifter has accused Islamists in the GNC of supporting extremist groups in Benghazi and fuelling the current instability in Libya. 

Hifter’s statements highlight the clear parallels with Egypt’s recent political transition, where General Sisi deposed Mohammed Morsi, the elected President, following widespread public dissatisfaction with the government, before launching a crackdown on Egypt’s Islamist groups. In an interview with an Egyptian newspaper on 22 May, Hifter praised Sisi’s actions and the Egyptian military coup, adding further credence to comparisons between the two men. 

In Egypt, Sisi’s anti-Islamist stance led to violent clashes between security forces and Muslim Brotherhood-led protestors – in Libya the Muslim Brotherhood has not yet mobilised significant street protests, however there remains the potential for future clashes. At the very least the Islamist factions in Libyan politics, led by the Misratan brigades and the Muslim Brotherhood, are unlikely to simply accept Hifter’s suggested steps for the political transition. 

2.6 Contact Details 

Tom Crooke Forward Deployed Analyst 
(Libya Office) 
Tel: +44(0)7551 154247 

Salamanca Group Libya Office 
Tel: +218(0)91 954 2006 

If you would like to contribute to this section of the LBBC website, in the first instance please contact the Secretariat at: secretariat@lbbc.org.uk or call +44 (0) 20 7152 4051