Gaddafi’s Looted Wealth and Libya’s Financial Future

By Ferhat Polat

Libya has been an important producer of crude oil since the 1960s. With a population of only six million and substantial annual oil revenues, amounting to $32 billion in 2010, Libya’s potential is tremendous.

However, during Gaddafi’s 42 years in power, Gaddafi and his cronies reportedly plundered as much as $200 billion from the country that was deposited in bank accounts around the world.



A recent Carnegie Endowment report identified the United Arab Emirates (UAE) as a hub for corruption and money laundering. Among the key points of concern, the report states that international criminal actors operate through, or from, Dubai.

Afghan warlords, Russian mobsters, African kleptocrats, European money launderers, Iranian sanctions-busters, and East African gold smugglers, all find Dubai a conducive place to operate.”

Transparency International, an anti-corruption group, stated that “Dubai has developed into an active international hub for money laundering where the corrupt and other criminals can go to buy an expensive property with no restrictions.” According to African Traders, gold can be imported to Dubai with little documentation.

Reportedly, billions of dollars’ worth of gold are being smuggled out of Africa every year via the UAE, which represents a gateway to markets in Europe, the United States, and beyond.

Frank Mugyenyi, a senior adviser on industrial development at the African Union, told Reuters, “There is a lot of gold leaving Africa without being captured in our records.”

In the past decade, gold from Africa has become more and more important for Dubai, where most of the gold is traded in Dubai, outwardly home to the UAE’s gold business. From 2006 to 2016, the percentage of African gold in UAE’s reported gold imports rose drastically from 18 per cent to 50 per cent.

Professor Tim Niblock, a specialist in Middle Eastern politics at the University of Exeter, commented that “Where the Gaddafis have hidden their vast funds is anybody’s guess, although [it is likely] most of it is in bank accounts and liquid assets in Dubai the Gulf and south-east Asia” rather than in relatively transparent countries.”

Indeed, it is believed that a large amount of money has been disappeared from frozen Libyan assets that were in UAE bank accounts.

According to a Reuters report, billions of dollars’ worth of gold is being illegally smuggled out of Africa to the UAE by foreign-controlled criminal syndicates. Reportedly, 55 tons of Libyan gold have been exported to the UAE in recent years.

The UAE’s ties with Haftar

Egypt, the UAE, Russia, and France have been supporting the Libyan warlord Khalifa Haftar and his so-called ‘Libyan National Army’ (LNA) out of concern for their own economic and geostrategic interests.

The UAE, in particular, has taken a proactive role in empowering Haftar and facilitating his control over eastern Libya, supplying vital support for his offensive against the GNA.

The UAE’s policy towards Libya is driven by various interests, which range from economic considerations to ideological objectives and the fight against political Islam. The UAE believes that Haftar is a viable partner for its efforts.

Countries such as the UAE, Saudi Arabia, and Egypt, continue to lead a movement against forces emerging from the Arab Spring, most notably the Muslim Brotherhood (MB).

The UAE has sought to prevent any democratic movement from taking power in Tripoli and has favoured a strategy that advances an authoritarian model of governance for the country.

As a consequence, Abu Dhabi found its partner in warlord Khalifa Haftar, who from 2014 onwards sought to expand his control from Eastern Libya to throughout the country.

However, perhaps more than that, Haftar seems to be significant to the UAE as a means of securing access to Libyan resources, including oil, gas, and gold.

According to a UN report, Haftar’s militias have received aircraft as well as military vehicles from the UAE and had even established an airbase at Al Khadim near the north-eastern Libyan city of Marj.

Moreover, Haftar’s headquarters at el Rajma is capable of hosting advanced jets, such as the F-16, Mirage-2000, and Rafale. Furthermore, it has also been reported that, since January this year, there have been dozens of flights from the UAE believed to be carrying hundreds of tons of weapons to support Haftar’s offensive against the Tripoli-based GNA.

A high-level Libyan official revealed that the UAE used Libya’s frozen assets in its banks to support Khalifa Haftar’s military operation. The official noted that it also used the money to finance the construction of its military base in Libya and the funding of Libyan media outlets based in Jordan.

According to a senior official in Tripoli, the UAE has reportedly drained $10 billion from Libya’s frozen funds in Belgium to support Khalifa Haftar’s offensive against the UN-backed government.

According to a UN report, so-called parallel institutions have at various times claimed to represent the LIA. In 2017, Libya’s U.N.-backed government formed a board of trustees and appointed Ali Mahmoud Hassan as Chief Executive and Chairman of the LIA, a move opposed by others who lay claim to the key financial institution.

Recently, Ali Mahmoud Hassan, chairman of LIA, said that “For at least the past five years, the LIA has had a reputation of being an enormous sprawling, uncontrolled operation with countless affiliates, many of them unknown to the general public, and the actions of their boards clouded in secrecy. Public confidence in the LIA suffered as a result”.

According to reports, some of these unknown officials are part of the “theft” of the Libyan frozen assets in coordination with the UAE.


After Gaddafi was killed in 2011, the UN ruled that the dictator’s assets in four Belgian banks be frozen.

According to a Politico report, €16 billion of Gaddafi’s frozen assets held in Belgium have been involved in big, regular outflows of stock dividends, bond income, and interest payments to unknown beneficiaries.

In 2018, a UN panel of experts on Libya stated that Belgium had been violating global sanctions targeting the assets of Gaddafi. The experts discovered that millions of euros in interest payments from Gaddafi’s frozen funds were still being distributed over recent years by Euroclear, a commercial institution headquartered in Brussels.

African countries

South Africa was charged with laundering Libyan money for several years. Allegedly, six million carats of diamonds and an unknown quantity of solid gold bars were placed in South Africa.

About $20 billion was thought to be maintained across four banks, whereas the rest was supposedly hidden in warehouses and bunkers around Pretoria and Johannesburg.

South African President Cyril Ramaphosa was called to help recover millions of dollars belonging to Gaddafi. Government authorities affirmed that billions in cash, gold, and diamonds were hidden at former president Jacob Zuma’s Nkandla house before being stealthily transported to Swaziland in 2019.

In 2011, before Gaddafi was ousted, millions of US dollars, gold and diamonds were allegedly transferred to South Africa on at least 62 flights between Tripoli and South Africa, reportedly crewed by Gaddafi’s ex-special forces.

Moreover, the South African media, alongside Libyan authorities, have identified Bashir Saleh, Gaddafi’s former chief of staff and the head of the country’s sovereign wealth fund, as a possible money mule.

Saleh reportedly fled to South Africa after Gaddafi was killed and was seen hobnobbing with government officials and luxuriating in five-star hotels.

In 2017, a panel of experts established by the United Nations Security Council(UNSC) published a report, which nder UN resolutions, flowed openly in Africa.

The panel’s research discloses that even greater money than was formerly recorded may have been smuggled via South Africa’s financial institutions. For instance, the report showed that $8 billion was moved from a Standard Bank of South Africa account to a Stanbic account in Kenya.

There are also reportedly several deposits of cash stashed around West Africa. Lynsey Chute, a journalist that covers southern Africa, wrote that “nearby Accra, the capital of Ghana, holds another part of Gaddafi’s legendary hoard.

There, the money was stored in boxes marked with the seemingly innocuous stamp of a humanitarian organisation, Le Comité International pour la Protection des Droits de l’Homme.

The security council panel contacted the Ghanaian police and the rights organisations’ headquarters in France, with no response. Last seen in February 2016, the money has allegedly been moved to another country”.

UNSC Experts also revealed that former Gaddafi loyalists still have access to Gaddafi’s frozen assets in Africa. These militia groups have allegedly been buying arms to support Haftar’s offensive against the UN-backed government.

Western countries

Governments in the UK, the US, and Italy seized over $30 billion in assets after the UN ordered them to be frozen in 2011. This step was purportedly done to prevent their theft or misuse during the war.

British banks hold an estimated £12bn of Libyan funds; the Libyan state has previously invested in London’s real estate market and in companies such as Pearson Group, owner of the Financial Times.

According to the Northern Ireland Affairs Committee’s latest report, the British government has collected £17 million in taxes on the assets between 2016 and 2019.

Dan Kovalik, an American human rights and peace activist, commented that “This is money that properly belongs to the Libyan people, what they are doing amounts to theft from the Libyan people, who really could use the money after the NATO bombing of Libya.

They left Libya a shattered country. The West has done nothing to help it rebuild. And then to steal assets like that […] is not only

illegal but it is immoral”.

According to the Washington Post, in 2011, Obama administration officials found $37 billion in Libyan regime accounts and investments, which were frozen, in the United States.

The LIA had previously invested in companies like General Electric, Caterpillar, Halliburton, Exxon Mobil, and City Group In 2011, Italy, which once had very strong ties with Gaddafi and was Libya’s closest partner in Europe, froze around 7 billion euros of Libyan assets as part of sanctions against Gaddafi’s regime.

Under Gaddafi, Libya had significant investments in Italy. Libya was Italy’s main supplier of oil, as economic analyses indicate, providing for approximately a third of the country’s energy consumption.

The Gaddafi regime owned a considerable share of the Milan stock market, consisting of 7.5% of UniCredit, Italy’s largest bank; 2% of the Italian oil company, ENI; 2% of the country’s second-largest industrial group, Finmeccanica; and 7% of the Turin-based Juventus soccer club.


While the crisis in Libya continues, there is a glimmer of hope that opportunities are emerging that could change the country’s current course.

One of the tasks that remain to be carried out is dealing with Libya’s wealth hidden across the world, particularly as significant quantities of this wealth has reportedly been used to fuel Libya’s ongoing civil war.

The country’s wealth pilfered by Gaddafi was supposed to be held in trusts for Libyans until the country is stabilised.

However, there are strong indications that some of these funds have continued to flow from supposedly frozen accounts to unknown receivers, which allegedly include former Gaddafi supporters and militia leaders, such as Haftar.

The flow of these funds should be monitored diligently to ensure Libyan wealth is redistributed equitably and for the benefit of all of Libyans.

If there is no viable solution to the conflict, Libya’s economic health will continue to suffer.

Rebuilding Libya’s economy will take resources and commitment on the part of the UN-backed government and international institutions to help develop a comprehensive strategy for economic stabilisation that includes restarting institutions such as the National Oil Corporation (NOC), The Central Bank of Libya and the LIA.

These institutions should be maintained as politically independent as possible in order to support post-conflict reconstruction.

Looking forward, the international community must establish a sustained strategy focusing on security, institution building, and economic growth.

Assisting Libya to track down funds that Gaddafi and his cronies looted from the country and working with the LIA to enhance its administration and transparency would have positive effects for the country’s economy.

If properly managed, Libya’s frozen assets could be a significant source of finance to utilise in the rebuilding of the country.


Ferhat Polat is a Deputy Researcher at the TRT World Research Centre. He is a PhD researcher in North African Studies at the Institute of Arab and Islamic Studies in Exeter with a particular focus on Turkish Foreign Policy.






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