BENGHAZI, LIBYA — Rebel leaders have urged countries that froze Libyan assets to shift that money to them, but diplomats say there are legal obstacles to such a move. A senior U.S. official said the coalition wants to provide financial support to the rebels, but hasn’t committed to a precise amount and is trying to figure out how to do so legally.On the same token, Libya’s rebel government said Tuesday that it is asking international donors for up to $3 billion in loans, warning that without the cash infusion it will be unable to pay the salaries of civil servants and provide food and medicine to civilians.
Top diplomats from around the world, including Secretary of State Hillary Rodham Clinton, are scheduled to discuss ways to meet the financial needs of the rebels at a meeting in Rome on Thursday.- After more than two months of fighting, the economy in the eastern portion of the country has been badly battered. While most of the country’s oil comes from the east, forces loyal to Libyan leader Moammar Gaddafi have disrupted production, denying the rebels a potential lifeline. The effective partitioning of the country interrupted pay for the majority of workers here, who are employed in the public sector and were paid from Tripoli before the fighting began.
Until now, rebels had, for the most part, managed to keep those salaries coming. But, they warned, money is running out.- Ali Tarhouni, the rebels’ interim finance minister, told reporters in the de facto capital of the rebel-held east that the Benghazi government has only enough to carry it through “three weeks, at the most four weeks.”
The senior U.S. official, who was not authorized to speak on the record and so talked on the condition of anonymity, said it was unclear how the Libyan rebels had come up with the figure of $2 billion to $3 billion. “I think we have to wait and see what the breakdown is, or how and why they’re asking for that particular figure” before deciding if it’s an accurate reflection of their needs, he said.- The official said that “there’s a whole gamut of options people are looking at” to provide financial assistance without violating U.N. sanctions or their countries’ own laws. It was not yet clear whether one mechanism would be chosen when the United States and other allies in the Libya Contact Group meet Thursday, he said.
- The rebels’ proposal that they receive frozen assets belonging to Gaddafi and his government presents legal hurdles for some countries, especially those, like the United States, that haven’t recognized the Transitional National Council, the self-appointed rebel authority, as Libya’s new government. In recognition of those obstacles, some European diplomats have floated the idea of creating a trust fund for the rebels, which would be repaid once a new Libyan government is established and oil revenues are flowing again.
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