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 - 10 October 2014:

This week’s strategic update from Bloxtons looks at the continuing political divide in Libya and the role of international actors. In addition this week’s oil report (available here) looks at who controls the oil sector, NOC payment difficulties and long term licensing.

Regional update

Tripoli, the East and South
Tripoli continues to return to normality, with many Libyan families returning for last week’s Eid. Petrol is readily available without queues and shops and banks are largely operating as normal. There is however a notable absence of expats. The Radisson, one of the two main international hotels in Tripoli remains closed and occupied by militia. The other international hotel, the Corinthia remains open with exceptional availability.

Libyan airlines continue to fly from Alexandria, Amman, Casablanca, Dubai and Istanbul. However schedules remain chaotic and often with low availability. There are also almost daily flights from Malta, chartered by a small Maltese company (please contact Bloxtons for further details). These however have limited availability (15 seats) with schedules only released the week prior. Flights from Malta, Alexandria and Istanbul also operate to Tobruk (please contact Bloxtons for further details). Due to the range of flight options we advise that for logistical reasons were possible clients no longer use the overland route to Tunisia (although it remains an approved route if required).

Developing from the recent Warshefarna clashes fighting continues in bou Sheba (circa 75km south west of Tripoli) with grad rockets launched from Azziziya (45km south of Tripoli), however to date there this has had no impact on the pattern of life in the wider western region including Tripoli.

The East
Following the intense fighting in Benghazi last week the standard and concerning pattern of assassinations has continued. Tobruk remains peaceful but there has been negative commentary associated with the visit of Prime Minister al-Thinni to Cairo and concern voiced in some quarters of the potential for increasing Egyptian influence in Libya.

Political Analysis

Although the celebration of Eid al-Adha, the annual Muslim holiday commemorating Abraham’s near sacrifice of Ishmael (the Quranic version of the story swaps Ishmael for Isaac of the Biblical tradition), brought a lull in Libyan politics, the GNC “government” in Tripoli is increasingly exerting power. This in turn has led to an emerging consensus among some international actors regarding a way forward. There are nonetheless other external actors for whom talk about dialogue between competing factions in Libya is merely a fig leaf for pursuing further military involvement.

The new consensus regarding some European and regional actors, including the United Nations Support Mission in Libya and the Algerian government, has coalesced due to a better understanding of conditions on the ground in Libya. In general, there is growing recognition that no Libyan political stakeholders – elected or otherwise – are acting in complete good faith. In addition, there is broader awareness of external support for different sides of the conflict in Libya. And finally, there is a heightened sense of urgency regarding the potential spread of support for the Islamic State in Iraq and Syria (ISIS) throughout North Africa.

Although initial emphasis on a political solution to Libya’s current crisis had privileged only elected institutions as legitimate participants in political discussions, disingenuous behaviour, coupled with almost utter impotence, has convinced some international advocates for a Libyan national dialogue of the necessity of including all potential political stakeholders. At first, Algeria was alone in this view, but it is increasingly gaining traction, most recently with some indirect support from Bernardino Leon. The emerging consensus is that dialogue needs to expand beyond just members of the House of Representatives (HoR) and to include representatives of Libya Dawn and individuals who have tried to revive the ostensibly defunct General National Congress (GNC). It is possible that the 12 non-sitting members of the HoR could become representative of Libya Dawn however this will require substantial negotiation. Second, the involvement of external actors as catalysts for the conflict has become increasingly recognized. As a result, if certain groups were to be excluded from negotiations, they would likely still be able to sustain their military efforts independent of the political process. Lastly, the emergence of the ISIS ally Jund al-Khilafa fi Ard al-Jazair in Algeria and a parade in the eastern city of Derna organized by the Islamic Consensus Youth Council which has also allied itself with ISIS has underscored the necessity of moving ahead with political negotiations even in less than ideal circumstances. Having seen a possible alternative future, the international community seems to be willing work with even those who are portrayed as less than truly democratic, such as Libya Dawn.

However, parties on the ground are clearly hedging and are unwillingly to abandon a potential military solution, or at least a military lifeline. The HoR’s Prime Minister Abdallah al-Thinni travelled to Cairo after Eid al-Adha to meet with Egyptian leader Abdelfattah Sisi in order to discuss intensified military aid. Meanwhile, Operation Dignity forces that are loosely allied with al-Thinni bombed a vessel off the coast near Benghazi that they claimed was delivering weapons and materiel to the Islamist Ansar al-Sharia in Benghazi. While these claims cannot be substantiated in this instance, Ansar al-Sharia has received shipments of equipment from Qatar in the past.

The present challenge for the part of the international community that supports dialogue is to prevail upon those external actors who are fuelling the conflict in Libya to cease interfering in Libyan affairs and to compel the clashing factions from across the entire political and ideological spectrum that dialogue rather than conflict is the most efficacious was to secure their interests. In the meantime, the grind of two governments continues.

Oil Sector

This week’s oil report looks at who controls the oil sector, NOC payment difficulties and long term licensing. From 16 October 2014 the weekly Libya oil report will only be available by subscription. To discuss subscription options and Bloxtons range of bespoke services please contact Sarah Price: sarah.price@bloxtons.com

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