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Ishaan Tharoor

The recent dramas gripping the country have been shadowy, shaped by backroom deals, black-market transfers and illicit smuggling.

The news out of Libya that tends to grab international attention often involves stark tragedy and disaster. If it’s not the harrowing civil war that has convulsed the oil-rich North African nation for years and split it in two, then it’s the drowning of migrants motoring out from Libya’s poorly patrolled coasts or the epochal flood that killed thousands in the city of Derna a year ago.

In recent months, though, the considerable drama gripping the country has been far more shadowy, shaped by backroom deals, black-market transfers and illicit smuggling. But it’s equally important and fraught. A rolling crisis over control of Libya’s central bank has paralyzed the economy and sparked new fears of conflict.

Oil exports have dropped precipitously in recent weeks, while ordinary Libyans are facing long lines at gas stations, restrictions on their ability to withdraw cash from banks and a collapsing electricity grid.The upheaval is the consequence of a spat that flared in August but was long in the works, experts say.

A move by forces close to Prime Minister Abdulhamid Dbeibah, who leads the government in western Libya, centered in the capital Tripoli, saw officials in the Central Bank kidnapped and led the bank’s longtime governor, Sadiq al-Kabir, to flee into self-imposed exile in Turkey. The Central Bank, which is the sole legal repository of Libya’s oil-generated wealth, ceased functioning. Oil exports were quickly shut down.

Kabir, in Istanbul, said Thursday that Libya was essentially cut off from the world financial system. “All international banks that we deal with, more than 30 major international institutions, have suspended all transactions,” he told Reuters. “All work has been suspended at the international level. Therefore, there is no access to balances or deposits outside Libya.”

At its root, the dispute is about rival power brokers’ designs on oil revenue in a country with Africa’s largest oil reserves. Dbeibah’s faction is at odds with that of Khalifa Haftar, which holds sway in eastern Libya and has cultivated deep ties with foreign powers such as Russia and the United Arab Emirates. In the tail end of the country’s ruinous civil war, Haftar attempted an offensive to capture Tripoli that ultimately failed when Turkey rushed military aid and support to the government in Tripoli.

The internationally brokered cease-fire in 2020 that followed has settled into an uneasy peace, with Dbeibah and Haftar fighting their battles through other means — for now.U.N.-led efforts to resolve the dispute are underway. But the situation is a reminder of the perilous state of affairs in Libya, which has lurched from crisis to calamity since the bloody revolution and NATO-backed campaign that overthrew Libyan dictator Moammar Gaddafi in 2011.

The country has not experienced stable governance since and is now torn apart by two rival political entities and a patchwork of armed groups. The Dbeibahs and the Haftars have emerged as powerful, quasi-dynastic clans, vying for influence over the key institutions like the Central Bank and the National Oil Corporation, through which most of Libya’s oil revenue flows. Analysts say Dbeibah’s manipulation of the bank for his corrupt ends saw Kabir warm to Haftar, who is simultaneously alleged to also be presiding over vast networks of illicit smuggling.

“Kabir had sown the seeds of his own demise,” the Economist explained. “At first he bought off his chief challengers: the people who had risen against dictatorship. After Gaddafi the state payroll almost doubled to 2.4 million in a country of 7 million. It is claimed the bank funded the warlords, paying fighters who both besieged and defended Tripoli.”

The British newsweekly added: “When the fighting ended in 2020, Kabir financed their ever-more grandiose schemes for hiving off Libya’s vast oil revenue. He paid billions to import fuel at market prices, subsidized it to make it the world’s cheapest, then let it be smuggled overland and increasingly by tanker to Europe. The more lucre and power the recipients amassed, the weaker he grew. When he tried to rein in the purse strings, it was too late.”

Deeper strains are showing. “The arrangements bridging east and west appear to be nearing a breaking point,” Libya scholar Wolfram Lacher wrote in a lengthy essay for New Lines magazine, pointing to a growing body of evidence regarding the state plunder carried out by both parties, but especially the Haftars. He added: “In the meantime, the Haftars’ greatly improved access to funds threatens to destabilize the balance of power.

[Khalifa Haftar’s son] Saddam has told close associates that he is seeking to turn western Libyan factions against each other and buy the support of selected militia leaders — a task made easier by the money he now has at his disposal. His father has informed Western diplomats that he intends to make another attempt to seize Tripoli.”ver the past week, a flurry of top regional officials, including Turkey’s spy chief, have visited the country.

The tensions have threatened a rapprochement between Egypt and Turkey, which find themselves at different sides of Libya’s divide. “Egypt and the UAE have backed Haftar in part because of his staunch anti-Islamist ideology that opposes the reliance of the Tripoli government on militias linked to the Muslim Brotherhood movement,” noted the Soufan Center, an independent global security think tank, in a memo earlier this month.

“Turkey, by contrast, has engaged regional Muslim Brotherhood-inspired movements and views Haftar as a right-wing figure dedicated to reducing Ankara’s regional influence. Russia, for its part, sees Haftar’s control of most of Libya’s oil fields as a tool in Moscow’s global competition with the United States and its European partners, all of which are backing Ukraine.”

The tangled geopolitics belies the frustrations of many Libyans who simply want a degree of political stability. “If you ask any normal Libyan, they’ll say we need one government, we need elections,” a former adviser to the Libyan government, speaking on the condition of anonymity over fears to their safety, told me. But, they added, the country’s power brokers aren’t interested in such an outcome. “Why would Haftar want one government?” the former official said. “He can print money as he pleases, now, and smuggle oil.”

A lack of Western attention here may be dangerous, especially at a moment when foreign powers could exert some pressure on Libya’s factions to get in line. “Diplomats may be busy stopping other wars in Ukraine and Gaza from growing into monstrous regional conflicts,” wrote Tarek Megerisi of the European Council on Foreign Relations. “But if they’re too consumed to take this brief opportunity, then they may well end up with a third before too long.”

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Ishaan Tharoor – Foreign affairs columnist and anchor of Today’s WorldView, the Post’s daily column and newsletter on global politics

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Karim Mezran

Libya’s three years of “unstable” stability appear to have reached their much-anticipated tipping point. In late August, the initial entente between Prime Minister Abdul Hamid Dbeibah’s clan and Libyan Central Bank (CBL) Governor Saddik al-Kabir came to an end when armed forces, acting on Dbeibah’s orders, stormed the CBL headquarters. However, the governor managed to flee to Turkey with his trusted collaborators and the codes that control the bank’s operations.

To put further pressure on Dbeibah, General Khalifa Haftar’s army, which surprisingly sided with Kabir, shut down key oil fields since August, creating a crisis that paralyzed the government in Tripoli. The international community must act rapidly and effectively to prevent an all-out war between the various Libyan militias and their foreign backers, which could inflame the already explosive Middle East and North Africa.

Tensions have remained high in the western region of Tripoli since 2019–2020, when fighters defended the Libyan capital from Haftar’s army—with crucial help from troops sent by Turkish President Recep Tayyip Erdogan. One of the main reasons for the current unrest is Dbeibah’s refusal to resign, despite his Government of National Unity (GNU) having failed at the core purpose for which it was appointed: organizing free and fair national elections. Public perception of the GNU has shifted from welcoming Dbeibah’s appointment in 2021 to seeing it as a “kleptocracy” aiming only to appropriate national resources for its enrichment.

The GNU’s legitimacy derives mostly from its having been created by the United Nations-led Libyan Political Dialogue Forum (LPDF), an assembly of Libyan citizens empowered by the United Nations (UN) to elect a prime minister and discuss related issues.

Surprisingly, in 2021, the UN special adviser on Libya, Stephanie Williams, agreed to have the House of Representatives (HoR) ratify the prime minister’s appointment, thus giving the parliament a power it was not supposed to have anymore. Elected in 2014 by less than 20 percent of those registered to vote, the parliament should have been dissolved by now given its four-year mandate.

But with the ongoing security risks and political turmoil, elections were never called and, thus, no replacement was possible—extending parliament’s mandate indefinitely. While the HoR—established in Tobruk in territory controlled by Haftar—initially ratified the GNU, it later withdrew its recognition in favor of a Government of National Salvation (GNS), established in the eastern province, loyal to Haftar, and a pseudo-government that opposes the GNU and legitimizes the general’s role.

In the east, Haftar holds all military power and Libyan Parliament Speaker Aguila Saleh exercises political power only with approval from Haftar. In the West, however, the situation is more fragmented because of the dynamics established by the first civil war (2014–2016). The first elected assembly, the General National Congress (GNC) elected in 2012, did not disband with the election of the Libyan parliament.

Instead, in 2018, the LPDF transformed it into a second chamber, the High State Council, which was supposed to have only advisory powers. With time, these powers had more influence than originally intended. (The HSC has been accused of being dominated by the Muslim Brotherhood, but this has never been proven, even though its head, Khaled al-Mishri, is undoubtedly a Brotherhood sympathizer.) The other key institution is the GNU, led by Dbeibah, who is well known for power grabbing through politicking and manipulating different stakeholders to remain in office at any cost for as long as possible.

These institutions exist within a framework formed by numerous armed militias, each with the support of a foreign power. After Haftar’s defeat in Tripoli in 2020, the situation in Libya hung in an uneasy balance, but this year could well be the one to change the course of Libyan history.

Complicating matters is the influence of foreign backers. Toward the end of 2023, Haftar’s Libyan National Army (LNA) received a large amount of weapons and military equipment  from his Russian allies. It is now ascertained that part of that military hardware was to go to Haftar’s army, the Libyan National Army (LNA), with the rest designated for the new Russian contractors’ company, Africa Corps, which has replaced the Wagner Group.

While theoretically independent, the company is a direct emanation of the Kremlin. The weapons received by the LNA were evidently enough to rearm and equip its troops. In recent months, the LNA has moved south, occupying large amounts of territory, and has been rapidly moving toward the border of Algeria and toward the GNU-controlled city of Ghadames.

This is causing divisions among authorities in Tripoli, who fear another attack by the eastern general. The Algerian government, alarmed by the prospect of an army closely allied with Egypt at its borders and in control of almost the entire country of Libya, put a stop to this movement, at least temporarily.

In reality, the threat of an attack by Haftar could be understood more as a pretext than a cause for the militias and politicians’ agitation over the past two weeks. The lack of sympathy, if not open hostility, between Kabir, the extremely competent and internationally respected governor of the Central Bank of Libya, and Dbeibah is well known.

Dbeibah continues to ask that the CBL release its hold on its finances and allow the government to obtain the funds needed to conduct its business and operations. Kabir understands the prime minister’s not-so-hidden intention to have access to the bank’s reserves for himself and his acolytes. This is the real reason for the confrontation, which has only recently evolved into a potential military clash between Dbeibah’s militia supporters and those who support the governor.

While the United States and a handful of European states condemned the act of surrounding the central bank with strong words in defense of Kabir, this is not enough. In Libya, whoever controls the purse strings controls the country, so the war around the CBL will continue—at least in the short term.

Foreign regional powers remain crucial to developments in Libya. From late 2019, these foreign powers’ control over their various Libyan proxies moved from absolute to lesser control. Haftar has managed—to a certain degree—to play his backers Egypt and Russia against each other by flirting with Moscow anytime he felt that Cairo’s support was waning. While the militias of Misrata, for example, counted on the support of Qatar, Italy, and, to an extent, the United States and the United Kingdom, and exacted many resources by playing on the rivalry between these powers and Turkey, another important supporter of Misrata and Tripoli.

The United Arab Emirates (UAE) today—unlike a few years ago, when its level of intermingling was high—seems to have taken a step back and is observing ongoing developments as Abu Dhabi determines how and whether to engage and how to ensure its strategic interests. In the struggle between Dbeibah and Kabir, foreign powers are divided, with the United States, the UK, most European countries, and Turkey supporting Kabir. According to some close to the author, Dbeibah believes he has the support of Saudi Arabia, the UAE, and France, but this remains to be seen. It is easy to see how volatile this situation is.

The real turning point was Haftar’s unexpected declaration of support for Kabir. The bank governor’s recent wiring of funds to Haftar’s bank to pay LNA soldiers and mercenaries, as well as some of the construction projects initiated by Haftar’s sons, are not enough for Haftar to undertake such a 180-degree turn, however at the moment, any hypothesis is possible and realistic.

The United States, beyond mere words of condemnation, should take the lead in fostering a closer coalition of countries that could push the Dbeibah clan out and facilitate the appointment of a new prime minister and cabinet determined by the HoR.

Kabir should be reinstated at least temporarily in his position as the governor of the Central Bank. Italy, too, has the potential to play a relevant role in pushing for a stronger rapprochement between Egypt and Turkey. Such a détente could resolve many difficult crises. However, even if all internal and foreign players align, the level of anarchy and fragmentation reached in Libya will still make resolution a difficult endeavor. 

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Karim Mezran is director of the North Africa Initiative and resident senior fellow with the Rafik Hariri Center and Middle East Programs at the Atlantic Council.

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Enrique Fojón

The fact that international attention is monopolised by the war in Ukraine and the conflict in Gaza has helped create a vacuum of attention on Libya, which is used by both local political actors and their regional and international allies to expand their influence.

One of the main beneficiaries of the conflict is General Khalifa Haftar, who could emerge as the victor of the current crisis. 

The Libyan National Army commander’s goal is to take control of the country and establish a military regime in which his clan dominates politically and economically.

After almost four years of low profile, Libya seems to be back on track. After the ceasefire and the formation of a unity government in the framework of the Berlin Process 2020/2021, there was hope for a unification of state institutions and sustainable stability. However, these expectations were dashed after the failure of the elections at the end of 2021 and the emergence of a parallel government in Benghazi in February 2022. 

The United Nations Mission in Libya (UNMIL) has so far failed to advance the electoral process and unify the country, although the international community seems to accept fragile stability as the lesser evil for now.

Since then, an agreement between the rival sides has allowed for a phase of relative stability. The agreement is weak and events are unfolding in a new situation in eastern Libya, dominated by General Haftar and his allies, weakening the current national unity government of Prime Minister Abdul Hamid Dbeibah in Tripoli. 

At issue is the distribution of oil revenues and the expansion of territorial influence.

In early August, under the pretext of national security and the need to protect the southern border from smuggling and illegal migration from neighbouring countries, the National Army, led by Haftar’s son, deployed in the southwest near the Algerian border, where one of the country’s largest oil fields and important smuggling routes are located.

At the heart of the problem is the power struggle in Tripoli that has reshaped Libya’s political alliances and helped the Haftar family obtain unprecedented funds to distribute favours. The Haftars have proven adept at exploiting that rift, between the seemingly immovable central bank governor, Siddiq Kabir, and Dabeiba, or rather his nephew, Ibrahim, who many consider the real power broker behind the Tripoli government. 

As a result of this struggle, the haemorrhaging of state funds is worsening, Haftar’s sons are consolidating their power, and ultimately the precarious balance that has kept Libya calm for the past decade could crumble.

Haftar and his clan have managed to further expand their economic and military power in recent years. In addition to official central bank funding, there appear to be illegal sources for this effort. The general unofficially received part of the oil production, which is smuggled into neighbouring countries, as Haftar’s troops control migration routes and gold mines in southeastern Libya. By controlling lucrative reconstruction projects in Libya, Haftar’s family secures a share of the company’s profits and investments. In addition to Turkish and Egyptian companies, investors from the United Arab Emirates are also interested in the reconstruction of Benghazi.

Haftar receives support from regional and international allies. Egypt, by welcoming Usama Hammad, head of Libya’s eastern government, on 11 August, risked a diplomatic crisis with Dbeibah, which considers his government the only officially recognised one. The move came at the same time as a diplomatic rapprochement took place between Egypt and Turkey, a major backer of the Western government. While Turkey has pledged to supply the Tripoli government with modern air defence systems, while calling on it to de-escalate tensions, this support is likely to be short-lived if it affects Ankara’s relations with Cairo.

Libya’s geopolitical value means that Haftar continues to receive military support from Russia. In early 2024, Russia founded the pan-African ‘Africa Corps’ with some 45,000 fighters to replace the Wagner Group and protect Russian regional interests. In addition to military control of smuggling routes, it is tasked with securing sources of resources such as oil and gas fields, as well as gold and diamond mines in Africa. A close relationship with Russia strengthens Haftar’s negotiating position in Libya while significantly limiting Europe’s ability to act in Africa in the coming decades, especially with regard to refugees and migration.

The power struggle for key positions in the Libyan state reached its climax when the Presidential Council ordered the dismissal of Sediq al-Kebir , the influential governor of the Central Bank. As a result, production at several oilfields was halted as a means of exerting pressure on this decision. 

Since then, oil production and exports have plummeted massively and the Libyans’ socio-economic crisis has worsened. 

In addition, the conflict over the new governor caused liquidity bottlenecks in the banks. All this increased the pressure on the Dbeibah government, which has failed to significantly improve the living conditions of the population since its founding in 2021. Instead, Dbeibah has redistributed state resources through nepotism and corruption in favour of his clan and the Tripoli elite to secure his position of power.

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Simon Speakman Cordall

With the central bank in turmoil, analysts say that diplomatic efforts in Libya are failing its people.

After weeks of tension that saw the Central Bank of Libya (CBL) shuttered, salaries go unpaid and cash vanish, the country’s two rival governments appeared ready to accept a United Nations-brokered agreement to resume operations,  before once more reverting to a deadlock familiar to many in the country.

The internationally recognised Government of National Unity (GNU) in the west had tried to replace CBL Governor Sadiq al-Kabir, accusing him of mishandling oil revenues and going to the extent of sending armed men in to remove him from his office.

Angered, the Government of National Stability (GNS) in eastern Libya, which is supported by renegade commander Khalifa Haftar, shut down much of the country’s oil production, which it controls, in protest.

“This is serious,” said Jalel Harchaoui, an associate fellow with London’s Royal United Services Institute. “The CBL, although weaker now than it was a few years ago, remains a linchpin to the nation’s access to hard currency.”

He added that the CBL funds most of Libya’s imports of food, medicines and other staples, which the country cannot last long without.

Since then, various analysts say, life in Libya has deteriorated as fighting has continued between rival Libyans and as the international community has tried to preserve the rule of a political and military elite, convinced they are the best for stability and for the proclaimed goal of “unifying Libya”.

Why the central bank?

As well as holding Libya’s vast oil wealth, the CBL unified Libya’s eastern and western “central banks” in one body to manage the salaries of civil servants and soldiers from both governments and build confidence that recovery was possible.

After the GNU-GNS struggle over who would head the CBL, al-Kabir fled the country, claiming that he took the access codes for bank deposits with him, leaving the bank isolated from international financial networks.

Asim al-Hajjaji, director of the CBL compliance department, said international contacts had been restored, although Al Jazeera understands that most international trading remains suspended.

Meanwhile, oil exports have plunged to a new low, salaries are uncertain and everyday life for about six million Libyans is in turmoil.

“The United Nations is talking about talks, which is a sure sign we’re nowhere near resolution,” Tarek Megerisi, a senior fellow at the European Council on Foreign Relations, said of negotiations to restart operations at CBL.

The West, which typically backs the GNU despite it being responsible for much of the uncertainty, “doesn’t know what to do, or really has the bandwidth to do it. They’re dealing with wars in Gaza and Ukraine,” he said.

“It’s just too much. In Libya, international efforts to achieve any kind of just settlement have lost momentum.” And this is far from the first time.

Over more than a decade of uncertainty and war, analysts say, the international community’s efforts focused on shoring up the country’s elites in the hope that might lead to stability.

The latest talks over the CBL appear little different, with access to the millions of dollars in assets of primary interest to the country’s elites, and access to the services and certainty craved by much of the population seemingly an afterthought, analysts told Al Jazeera.

Elite bargains presiding over endless

turmoil

“Preventing a shooting war has come to be seen as the only international strategy in Libya,” Tim Eaton, a senior fellow at Chatham House who contributed to a paper on the international practice of prioritising powerful elites, told Al Jazeera. “It’s death by a thousand cuts,” Harchaoui said.

“Everyone’s talking about a return to the status quo as if there were ever a neat, static equilibrium,” he noted. “This was never the case. Even when things appeared quiet, the arrangements were continually decaying and degrading. And that gradual deterioration is what suddenly became visible last month with the CBL crisis.”

National elections, or even a framework that might lead to them, remain a distant prospect after the last vote, initially scheduled for December 2021, was postponed after infighting.

“Any move towards holding national elections has been blocked,” Eaton said. “Both [Abdul Hamid] Dbeibah [head of the GNU] and Haftar might say they want elections tomorrow, but they only really want their side, or at least their proxies, on the ballot paper.”

Both governments continue to rule separately, while their members, allies and militias profit from smuggling in both people and fuel and unregulated cross-border trade.

However, as individual members jockey for position within small and exclusive circles, systems intended to support everyday life in Libya continue to deteriorate and fail. Eaton notes that the city of Derna, which flooded in September 2023 after a dam that the GNU was responsible for collapsed, remains unreconstructed. “For healthcare, Libyans have to go overseas,” he noted. “And if anyone is ever caught in an emergency, there’s no one number or department they can call. “All the while, the super-rich that are supposed to be looking after people, are getting even richer.”

Both sides, he explained, claim to work towards establishing a central government while state institutions needed to oversee any future state, like a strong central bank, have been hollowed out and captured by elites on either side.

Regionally, over its 13 years of sporadic conflict and political uncertainty, Libya has become a continued source of instability within an already unstable region. Within a divided Libya, various actors have come to use the country’s east as a staging point from which to project their own international ambitions in Sudan, Syria and beyond.

Overwhelming human cost

In addition to the uncertainty piled on the Libyan population are the more than 1,000 refugees, irregular migrants and asylum seekers who have died or gone missing on the Central Mediterranean migration route, in which Libya is a key part, this year. “The West and UN in Libya are performing diplomatic theatre while the country crumbles,” Anas El Gomati of the Sadeq Institute said.

“They have a toolbox of leverage gathering dust. Instead of applying pressure, they’re enabling corruption by legitimising those without electoral mandate or political credibility. That’s not diplomacy; that’s complicity in slow motion.”

El Gomati continued: “East or west, Libya’s compass points to chaos and corruption. Haftar and his kids carve out a fiefdom through war crimes in the east, while Dbeibah runs a ‘pay-as-you-go’ loyalty scheme with armed groups in the west.

“The irony? The elites don’t trust the very banking system they’ve bled dry, so they keep their assets overseas, which the West could freeze, but they’re too busy shaking hands with the very hands pickpocketing Libya’s future.

“Western policymakers and Libyan elites are locked in a race to the bottom of delusion and greed,” El Gomati concluded. “The West sees a finish line; the elites see an endless buffet. It’s not naivete, it’s willful blindness, and the Libyan people are paying for it. In the Libyan elite’s casino, the house always wins, and corruption is the chip that never runs out.”

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Manaf Saad

While he never underwent any real military training, he has been crucial to his father’s bloody power struggle. He is now being backed by a range of powers to be Libya’s next leader.

It was spring 2012, the height of Libya’s revolution against their dictator Muammar Gaddafi. As the intrepid revolutionaries trickled into Benghazi’s operations centre one morning, something was different. Clustered in a corner were a few surly young men sipping coffee, scrolling Facebook on their laptops.

Thinking they were perhaps new recruits whose zealousness allowed them to stumble into this sensitive location, the revolutionaries marched towards them to teach them a thing or two about operational security in wartime. An older officer blocked them: “Leave them alone, they’re General Haftar’s kids”.

General Khalifa Haftar—Gaddafi’s one-time co-putschist turned frenemy—had just returned to Libya, offering (in a very demanding way) to lead the revolutionary forces. So, his sons were to remain ‘inside the tent’ until issues with command were sorted. But the opposition to the general—who was then best known in Libya for crimes against his own people during the Chadian war of the 1980s—quickly grew. As it did towards his sons, who incensed those in the operations room by refusing to help. Instead, they aggressively flexed their impunity, spending all day browsing the net on insecure computers. Until, one day, smiles went round those same revolutionaries. They got permission to chuck out the Haftars.

One of these kids, Saddam, was not notably seen again until later that year. Amidst the chaos of the fall of Tripoli in October 2012, he was wounded trying to storm the al-Aman bank.

Almost 15 years later, that surly young gangster Saddam Haftar is a brigadier-general, chief of staff of the land forces of the Libyan Arab Armed Forces (LAAF).

Like most success stories of modern Arab politics, Saddam’s surprising rise is deeply rooted in nepotism. While he never went through any real military or officer training, he has been a crucial lieutenant to his father’s bloody power struggle—alternating between being a diplomat, a brutal suppressor of dissent, and overseeing an extraordinarily lucrative multinational business operation that smuggles everything from scrap metal to people.

This is why, despite never finishing school, having no noticeable signs of charisma, and a political toolbox limited to blunt violence, he is now being backed by a range of regional and international powers to be Libya’s next leader.

The Karama Kid

Having been unceremoniously rejected by the revolution, General Haftar left Libya, only meaningfully returning to Benghazi in 2014. Shooting amateur video from a military base, he launched “operation Dignity” (Karama in Arabic)—an operation painstakingly crafted to look like a local fightback against Islamist extremism. When it was really a multinational operation to return Libya’s chaotic revolutionary republic to a state of military authoritarianism.

What followed were years of messy, destructive, urban warfare before Haftar conquered Benghazi from a ramshackle alliance of revolutionaries, Islamists, extremists, and poor young men who had simply ended up on the wrong side of his conflict. Despite initially claiming he would retire after ‘liberating’ Benghazi, Haftar’s multinational coalition unsurprisingly pressed on to take the rest of eastern Libya, violently subduing the city of Derna through a series of foreign-supplied air strikes and a suffocating siege.

Haftar gradually traded the gun for gold and seized Libya’s lucrative oil crescent and eventually large swathes of southern Libya by promising key tribes’ prestige and riches if they became the local franchisee of the military enterprise he now presented as a national project.

While most attention during these years was on the battlefields in Libya, Saddam kept his father’s military machine lubricated with the weaponry, ammunition, financing and support it needed to proceed, cutting his teeth as an international operator. Saddam served as Karama’s de facto chief ambassador, managing the material support directed to his father’s campaign. According to the United Nation’s Panel of Experts responsible for investigating violations of Libya’s sanction regime, these military re-supplies were usually managed by obscure aircraft chartering companies.

As the military operations continued growing, so too did the amount of munitions and additional equipment required, as it became clear that Haftar would need overwhelming material superiority to win a war. So, Saddam had to start building additional procurement channels to supplement the largesse of his foreign partners.

As later confirmed by Haftar’s Airforce chief Saqr al-Jaroushi, it was Saddam who sourced the arms his father depended upon “from secret partners and foreign states” alongside his brother-in-law Ayoub el-Ferjani. And war is tremendously expensive. In early 2016, the parliament speaker, Aguileh Saleh, called for an investigation into Haftar’s diversion of state funds and material, given that the procurement was managed by his clan and distributed according to who was loyal to them.

Once upon a time in Benghazi

At this time, Haftar’s operation Karama was formally under what was dubbed the interim Libyan government appointed by the House of Representatives whose seat was in Tobruk, in Libya’s far east.

The diversion of state resources along with Saddam extorting commercial banks to fund his procurement through locally issued debt were a growing cause for concern. Not just because of what was spent, but more because of what it had bought.

Three years into the war for Benghazi, Haftar had shed his ‘counter-terror’ pretensions: offering safe passage to Islamic State (IS) fighters towards western Libya but no surrender for Libyan opposition; Haftar’s forces were detaining or intimidating parliamentarians, activists, judicial staff and anyone else of influence; and civilian mayors were being replaced by military governors.

This synched up with Saddam’s gradual transition from Yuri Orlov impersonator to leading the domestic terror of Haftar’s counter-revolution. Saddam was appointed de facto head of the Tariq bin Ziad (TBZ) brigade, largely composed of Madkhali Salafists who had fought on Benghazi’s frontlines. This unit became Haftar’s version of Gaddafi’s feared revolutionary committees, making a spectacle of arresting and punishing anyone who publicly criticised the new regime. From TBZ’s base at Sidi Faraj, east of Benghazi, Saddam has set up his own fiefdom. Here, he oversees a parallel prison system where he can not only violently re-educate civic activists but also put pressure on businessmen or members of prominent families for ransom.

Alongside his brother Khaled, he also helped institute the 106th Brigade, which operates as a de facto praetorian guard for the Haftars and is amongst the best-equipped units of the LAAF.

At the end of 2016, Saddam’s military future was clear to see as he was pictured in a captain’s uniform attending a military ceremony for LAAF recruits. Despite never attending a military college or spending any time on a battlefield, he was promoted to Major within a year. Soon after, a now clearly subordinated Aguileh Saleh humiliatingly appointed him a Lieutenant Colonel, as the seasoned military officers who had joined Karama at the start looked on in dismay and disgust.  

The road to perdition

At the end of 2017, Saddam Haftar marked the nominal end of the war in Benghazi in a similar way to the nominal end of the 2011 revolution by robbing a bank.

Having arrested the Deputy Interior Minister of the interim government, who was responsible for securing banks. Saddam used Brigade 106 to storm the Central Bank of Libya’s eastern headquarters, trying to seize an estimated 640mn Libyan dinars, €159mn, $2mn, and almost 6,000 silver coins – though some of the cash was damaged beyond use after a broken pipe spewed sewage water around the vault.

Interestingly, it took only six months for the seized Euros to begin showing up in Europe, usually in the hands of those linked to mafias.

At this point, the rise of the Haftar’s seemed inevitable. The Libyan Arab Armed Forces nominally controlled most of Libya’s land mass; it had fully domesticated the national parliament, its international backing had swelled to include most major powers, and even the UN’s ‘national conference’ designed to reboot Libya’s political transition was bending to empower them. Then, Haftar decided to attack Tripoli.

Just over a year later, the LAAF was in disarray; its tribal support had melted, and many in the east were so aggrieved over the young men tricked into fighting with promises of a quick victory and plenty of plunder that Haftar had to stagger the return of body bags. Haftar and the LAAF as entities were saved by the Russian mercenaries his other backers had bought in to try to salvage the operation. Haftar had survived, but only just, and he was now entirely dependent on a Russian mercenary group.  

Despite his impressive rank, Saddam was mostly distant from Tripoli’s battlefield. He was putting his talents to use elsewhere, maintaining the money supply needed to fund his father’s war. Like in his previous conflicts, Haftar’s army was undisciplined, prioritising destruction and outfiring their opponent. According to a Russian military analyst on the ground, LAAF fighters showed their unprofessionalism through “indiscriminate” fire. Keeping the LAAF profligate kept Saddam busy.

From the start of the conflict, two Ilyushin cargo planes arrived each day, carrying up to 500 tonnes of Russian munitions each. Occasionally, a French Air Force C-130 Hercules would also land in Benghazi, likely with more munitions for the forces besieging Tripoli.

To keep this multinational war machine liquid, as debt became harder to obtain due to the spiralling liabilities of eastern Libya’s banks (which one day would almost crash Libya’s entire banking system), Saddam tried to step up the activities of the LAAF’s Military Investment Authority. This involved everything from stripping Benghazi’s infrastructure and the rubble of his father’s previous wars for scrap for sale, illicit sales of crude and fuel, and even taking over agricultural projects in Libya’s south. By 2020, Saddam was even said to be organising flights of the Haftar’s private jet to Venezuela, exchanging duffel bags of US dollars for gold to pay his creditors.

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Manaf Saad – A journalist residing in the Middle East, whose real name is withheld for security reasons

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Ferruccio Michelin

There is an East-West agreement for a roadmap to resolve the crisis around the Libyan Central Bank, and restart oil production. Is the country ready for political compromises, or is it just a matter of delaying decisions and taking time?

The announcement of an agreement between the two main rival political factions in Libya, to jointly decide on the appointment of a new leadership to head the Central Bank of Libya (CBL), represents a fundamental step towards resolving the economic and political stalemate that has paralyzed the country in recent years, which has reached a particularly tense situation with the issue of the institution. This agreement, brokered by the United Nations through the Unsmil mission, opens a short-term window for the resumption of oil activities and in the long term could mark a significant turning point in the long internal divisions.

The roadmap of the agreement

According to information first published by Bloomberg , the two legislative institutions – the Tripoli-based Council of State and the Tobruk-based House of Representatives – have agreed to appoint a new CBL governor and a governing council within 30 days. The agreement aims to unblock oil production, which has been severely reduced due to the political conflict between the two factions. Negotiations will continue until September 9, with the aim of consolidating this first step towards a broader resolution.

However, this agreement seems more like a compromise to buy time than a real solution to the crisis. The parties have essentially given themselves a month to resolve the issue, instead of resolving it “today.” Furthermore, rumors have already emerged that the process could be extended further: “In case of disagreement, the interim committee (of 30 days) will be extended for another 30 days,” the sources explain, and “this already suggests that the roadmap could be further delayed, making a resolution more difficult.”

The implications for the economy and oil

The Central Bank is at the center of the battle for control of the country’s energy resources, which are Libya’s main economic engine. The divisions between East and West are reflected not only in political issues but also in the management of oil supplies, with the production blockade reducing the national output from 1.2 million barrels to less than half. Oil, in fact, is not only an economic good, but also a strategic weapon in this long-running dispute. The eastern faction, which controls the main oil export terminals, has used this leverage to put pressure on Tripoli.

The Western government of Abdelhamid Dabaiba should agree to keep or temporarily bring back the “old guard” of the Central Bank, after a push to replace the leadership. The eastern government under the military control of Khalifa Haftar should feel sufficiently capable of making its choice prevail for the next CBL leadership, even without leveraging the oil blockade. If these conditions are not met, the risk is that the process will drag on further, making a short-term compromise even more difficult.

A peculiarity

The current oil blockade in Libya presents a problematic feature compared to similar situations already experienced in the country: for the first time there is the risk that several hundred thousand barrels of crude oil extracted from the Mesla-Sarir fields will no longer be sold by NOC (the state-controlled National Oil Corporation), but by a private company based in Benghazi, Arkenu.

The dynamics that brought the company to international attention, no later than July, are explained by Agenzia Nova . It is a very delicate scenario. The possible cessation of regular exports from NOC could be used by the Haftar family not only for their own blackmail — as has happened several times in the past — but this time also to create direct interests. Among other things, the Energy Triumph oil tanker chartered by the Chinese Unipec is now close to the Harriqa terminal and should load a cargo of 1 million barrels.

A political and institutional challenge

Although the agreement appears to represent a turning point, numerous obstacles remain. Libya has been politically fragmented since 2014, and the institutional system is extremely fragile. Elections, initially scheduled under the 2020 ceasefire agreement, have not yet taken place, and the situation remains unstable. Sadiq al Kabir, in office since 2011 at the CBL, is a controversial figure: on the one hand he currently enjoys Haftar’s support, on the other he is accused of mismanagement and corruption.

Accusations that have further soured relations with the prime minister of Tripoli, Dabaiba, who has tried to oust him. Another potential candidate for the leadership of the CBL, Mohamed Abdel Salam al Shukri, has refused the post, saying he will only accept with the joint support of the two factions. This underscores how difficult it is to find a consensus figure in a context of deep divisions.

“The deal represents a rare window of opportunity for Libya. If completed, it could help unlock oil production and stabilize a crucial part of the country’s economy,” one source said. However, he added, “political instability and internal divisions remain significant obstacles. Libya once again faces an existential challenge: can it overcome its internal divisions and find a balance for a sustainable economic and political recovery?”

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Tarek Megerisi

Diplomats may be busy stopping other wars in Ukraine and Gaza from growing into monstrous regional conflicts. But if they’re too consumed to take this brief opportunity, they may end up with a third before too long, Tarek Megerisi writes.

Libya’s Tripoli-based government’s recent clumsy attempt to replace the central bank governor should be a blaring alarm in the central Mediterranean.

It quickly led to a shutdown of Libyan oil exports, Libya’s quarantining from international financial systems, and the cessation of all payments or credit in a state where people are dependent on public-sector salaries and imported goods.

The situation will create a socio-economic crisis for Libya’s long-suffering population, one that could quickly turn violent given the rivalries still tearing the country apart.

But, weirdly enough, it’s also a golden opportunity to stabilise Libya that Western actors are overlooking. Instead of watching the country’s further disintegration from afar, Europeans and the US should leverage this crisis to press for technocratic control of the bank as a prelude to much-needed elections.

What happens in Libya never stays

in Libya

From a distance, Libya’s current events might just seem regretful de rigueur, nothing new for a country so deeply knotted in calamity that even former US President Obama could only call it a “shit show”. But what happens in Libya never ends up staying in Libya. This long-burning conflict has fuelled an insurrection in Mali, helped re-ignite the devastating civil war in Sudan, and almost pushed NATO countries to conflict in the eastern Mediterranean.

Meanwhile, the diffidence of the Western powers that helped Libya’s armed revolution in supporting its subsequent transition created a void that other powers, notably Russia, are also now happily filling. Since Libya’s last war in 2020, Moscow has transformed Libya into the logistical hub of its Africa operations. Russia has seized military bases a few hundred kilometres from NATO’s Sicilian HQ and turned Libya’s lawless and vast expanse into a smuggling den to break sanctions over Ukraine.

If this crisis drives Libya to war, it would be far messier than the last. Libya’s fragmenting fault lines suggest this would be a constellation of simultaneous conflicts rather than a single-front, two-party war. The entrenchment of key players like Russia, Turkey and the UAE across Libya and its southern neighbours, alongside heightened sensitivities from Egypt and Algeria, makes the prospect of a messy, overlapping and uncontrollable conflict just as likely internationally as it is domestically.

The chaos this messy internationalised war would bring to what’s already a smuggling hotspot, means any new round of conflict will be toxically destabilising for Africa, the Middle East, the Mediterranean and Europe. An outcome that will almost certainly advance hostile Russian influence at the expense of flailing Western sway.

Cosplaying generals and politicians

The petty yet powerfully destructive competition between Libya’s collection of cosplaying politicians and generals since 2011 has ultimately been for Libya’s wealth. This makes the central bank Libya’s most valuable prize and the greatest point of leverage over a political class that has exasperated all previous attempts to progress Libya’s transition with its stubbornness, selfishness and small-mindedness.

But, by bungling the attempt to replace the central bank governor, Libya’s president has created a crisis demanding urgent redress. His appointed governor cannot access key functionality, like the SWIFT payment system. Meanwhile, the intransigent rivalry between Libya’s political bodies means the parliament, senate, government and presidency are unable to agree on a new mutually acceptable board of governors that could gain the international confidence needed to run the bank.

Their inability to resolve this, the urgent need to prevent a socio-economic crisis, the UN’s already mandated mediation role in Libya, and the unique financial oversight role of the US, UK, and France over Libya’s central bank create the perfect recipe for turning this crisis into a gain.

Yet, Western diplomats have thus far done little more than offer concerned statements. Statements Libya’s leaders feel at ease ignoring because experience tells them they won’t be punished, and the prospect of seizing control of Libya’s central bank is too tempting a prize.

Be careful not to end up with a third

major war

Instead, the US and key European states should announce a position that, given the current legitimacy crisis, only a technocratic board of governors appointed via a UN process will be considered legitimate to plug Libya’s central bank back into the global financial system.

Given the political crisis, with Libya’s institutions refusing to recognise each other and the absence of a budget, the new board should also be limited to facilitating core state subsistence spending, like salaries and key imports, until new national elections are held that provide for a politically empowered new board. This would also depoliticise the policy, deflating potential claims that it violates Libyan sovereignty.

This would strong-arm Libya’s politicians into accepting the new process. The longer they stall, the more popular pressure will build as the economy breaks down. Russia could try to spoil the situation, but its only real option would be to veto the upcoming renewal of the UN’s support mission, given that it already has a mandate to mediate.

So, in one move, western powers can halt the march to war and imbue a new political process with an urgency and engagement that previous ones lacked. Sometimes, a simple solution to a complex problem like Libya seems too good to be true. But with a bit of political capital, Libya can finally be pushed to a much more stabilising place.

Diplomats may be busy stopping other wars in Ukraine and Gaza from growing into monstrous regional conflicts. But if they’re too consumed to take this brief opportunity, then they may well end up with a third before too long.

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Tarek Megerisi is a senior policy fellow of the Middle East and North Africa programme at the European Council on Foreign Relations (ECFR).

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Prof. Miral Sabry AlAshry

The United Nations Support Mission in Libya (UNSMIL) has condemned reports as part of a larger disinformation campaign aimed at misleading the Libyan public and diverting their attention from their rightful demands for political and economic reforms.

The ongoing disinformation campaign has been launched to deceive Libyans regarding news circulating about an imminent announcement of a new roadmap that includes freezing the work of the House of Representatives and the High Council of State. The United Nations Support Mission in Libya (UNSMIL) has denied these reports, stating that they are part of a disinformation campaign. A fabricated story was spread through local and regional news networks, announcing a roadmap to elections in Libya by SRSG Abdoulaye Bathily.

UNSMIL urges all media networks to rely on the Mission’s official website for accurate news and announcements. This content was created and fueled by foreign actors in Libya, contributing to confusion about reform and a democratic roadmap. Difficulty in identifying the truth has led to demoralization and distrust among many Libyans.

Nested within Libya’s ongoing civil war is a fog of falsehoods and distortions about reform towards a democratic roadmap through elections, fake elections by Parliament, preparation of the Constitution, and polarizing narratives that have engulfed Libyan social media networks and online news outlets.

Since the US- and NATO-backed intervention that removed Libyan authoritarian leader Muammar Gaddafi in 2011, the country has faced ongoing challenges. From July 2019 until now, Libya has experienced recurring social, political, security, and economic crises, resulting in weakened state institutions and a declining national economy. Various European countries have held political conferences in Berlin, France, and Moscow, and a ceasefire in 2020 ended the civil war initiated by Khalifa Haftar against rival political factions. However, this has only fueled fragmentation, disunity, and a war-driven economy.

Efforts to move forward with elections scheduled for December 2021 have been hindered by rival factions unwilling to agree, leading to the indefinite postponement of the vote. Governments have used media platforms to spread false and misleading information, further dividing the public. Frustration on both sides of the political spectrum has intensified, increasing pressure on the Government of National Unity to hold elections and address the misuse of platforms for political polarization. This situation has resulted in heightened levels of violence, protests, and division, along with new challenges such as the negative impacts of a fragile oil-dependent economy and the proliferation of weapons.

SRSG Bathily of the Security Council has emphasized his intention to intensify negotiations through constructive engagement with all stakeholders to lead to successful elections, facilitate an inclusive and transparent settlement of contentious issues in the electoral laws, and ensure these laws are implementable.

Khalifa Haftar has been aided by online firms tied to Russian oligarch Yevgeny Prigozhin and his Wagner Group of Russian mercenaries, who have published divisive narratives on Libya’s social media networks. Bathily is working to reach a comprehensive agreement on controversial issues in the electoral bills to ensure their applicability for successful elections.

Starting in 2014, large networks of UAE and Saudi fake Twitter and Facebook accounts actively crowded out actual local voices by posting, creating hashtag traffic, and amplifying nationalistic sentiments in Libya. In 2019, thousands of these accounts were mobilized to glorify Haftar and his military campaign, while the EU engaged in foreign-backed efforts to undermine the formation of an informed and democratically engaged public in Libya’s digital spaces.

The United Nations Support Mission established a higher financial committee to address basic issues in public spending and the fair distribution of resources. This step aims to provide equal opportunities for all candidates in the upcoming elections by the end of 2023, ensure transparency in public fund spending, and achieve a fair distribution of national resources.

The Role of Misinformation in Shaping

Libya’s Political Dynamics

Misinformation has become a powerful tool in the Libyan political landscape, significantly impacting public perception and political dynamics, and changing societal views. The spread of fake news and disinformation across social media platforms has intensified existing political polarization, leading to conflicts between rival factions. In May 2014, General Khalifa Haftar launched Operation Dignity, a campaign by the Libyan National Army (LNA) to attack Islamist armed groups across eastern Libya, aiming to consolidate and strengthen his army. The armed groups, including Ansar al-Sharia, formed an alliance called Libya Dawn. Fighting erupted at Tripoli International Airport between the Libya Dawn alliance, controlling Tripoli and most of western Libya, and the Dignity alliance, controlling parts of Cyrenaica and Benghazi in eastern Libya, escalating the conflict into a full-blown civil war that has resulted in further violence.

Various actors and political factions have exploited misinformation to influence public opinion, undermine opponents, and consolidate power. Disinformation campaigns began with the deliberate dissemination of false or distorted information, with the aim of misleading the public and shaping political narratives in favor of specific alliances. Libya, which has become increasingly difficult to control, has cut across tribal, regional, political, and religious lines. To find a solution to the conflict and establish a unity government, the UN Special Envoy to Libya facilitated talks between the Tobruk-based House of Representatives (HoR) and a key supporter of Haftar.

These talks led to the creation of the Libyan Political Agreement (LPA) and the UN-backed Government of National Accord (GNA) in December 2015. However, the GNA has faced challenges in establishing a stable and unified government in Libya. Amid these discussions, fabricated stories, manipulated images, and misleading statistics have emerged, contributing to a distorted understanding of political events and actors. In Libya, such tactics have exacerbated existing divisions, creating an environment of mistrust and hostility between different political groups and their supporters.

Exploiting widespread political instability, Islamist militant groups, including Ansar al-Sharia, have seized territory in Benghazi, Derna, and Ajdabiya. The Islamic State’s power in Libya peaked in 2016 when it captured the coastal city of Sirte, previously the group’s most important stronghold outside Syria and Iraq. Haftar’s LNA forces have attempted to wage war against Islamist universities while in control, and their members have committed numerous human rights abuses, leading to prosecution in Libya. In July 2018, Haftar announced that the LNA had retaken the city of Derna.

The Impact of Disinformation on

Governance and International Relations

In 2019, both governments deployed a new strategy of disinformation in Libyan politics that serves multiple purposes. For some political actors, it is a means of discrediting rivals and delegitimizing opposing views, with the UN quickly brokering a ceasefire in September 2018 between the militias involved. Foreign states, including Egypt, Saudi Arabia, the United Arab Emirates, France, and Russia, back Haftar’s LNA, while Turkey, Qatar, and Italy support the GNA. Egypt and the UAE have been particularly involved in supporting Haftar militarily, fearing the GNA’s association with political Islam and the Muslim Brotherhood. This will strengthen their political standing. For others, it is a tool to mobilize supporters and influence election outcomes.

This manipulation of information is often driven by a desire to control narratives on key issues, such as governance, security, and access to resources such as oil, which remain a major source of conflict and competition. Russia has allowed the Wagner Group to assist Haftar in exchange for strategic access to ports and other transit hubs. Meanwhile, Turkey supports the GNA because of the offshore oil and gas deals it has brokered, with Turkey and Egypt agreeing to deploy troops.

The rise of disinformation in Libya has been recognized by the EU as a significant risk due to its profound consequences. Disinformation not only disrupts democratic processes, such as elections but also contributes to violence and societal unrest. In late 2022, tensions were high as the HoR consolidated its institutions and political negotiations fractured. Despite UN-led talks failing, the HoR passed a constitutional amendment in March 2023 to pave the way for elections and proposed the appointment of a new National Executive Committee to replace the General National Congress and the HoR. However, this move also led to violence and societal unrest.

The spread of false information can incite violence, deepen political divisions, and undermine trust in institutions. The HoR established a 6+6 Joint Council committee to develop a roadmap for elections. In June 2023, this committee recommended the formation of a new interim government in preparation for elections. While progress has been made in various peace talks, violence persists, and any agreement lacking strong support from Dbeibah and Haftar is likely to further polarize the situation.

Fragile Political Stability and Persistent

Disinformation in Libya (2024)

In 2024, political stability in Libya remains fragile, and the public sphere is highly contested. Disinformation continues to have a strong impact, reinforcing cycles of conflict and hindering efforts toward reconciliation and democratic governance. Regional disputes over oil deposits and arms deals have further complicated the prospects for peace, with the GNA signing agreements with Turkey and Italy’s Eni, leading to tensions with Greece and Egypt over maritime borders.

The ongoing political turmoil has negatively affected economic output, as oil revenues account for over 80% of Libya’s total exports. Concerns are growing over the country’s ability to sustain itself economically as armed groups fight over oil fields, restrict production, engage in illicit trade, and disrupt operations. Addressing the challenges posed by disinformation in Libya requires a multi-faceted approach, including improving media literacy, strengthening fact-checking mechanisms, and promoting transparency in political communication. By mitigating the effects of disinformation, a more informed and united society can be fostered, ultimately contributing to greater political stability and democratic integrity.

The digital age has brought social transformation to North Africa, with an estimated 160 million social media users in the Arab region by 2021. The government utilized these platforms to spread false or exaggerated news, as seen in the impact of psychological operations (PSYOPS) in Libya, influencing attitudes and behaviors to achieve military and political objectives.

Media ownership plays a significant role in the activities of fact-checking organizations in Libya. While many claims to be independent volunteer groups, they may still face similar repression and self-censorship issues as journalists.

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Prof. Miral Sabry AlAshry is Co-lead for the Middle East and North Africa (MENA) at the Centre for Freedom of the Media, the Department of Journalism Studies at the University of Sheffield.

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Fehim Taştekin

This is a full-blown crisis.

The ongoing division in Libya is prolonged by this dynamic: while the Government of National Unity (GNU) leverages its international legitimacy to control oil sales, the valves are in the hands of eastern forces.

Militias controlling regions, cities, neighborhoods, and even government institutions siphon off the Central Bank’s resources as much as their weapons allow. Salaries account for 78.4% of the Central Bank’s expenditures. Of the 26 billion dinars spent by the bank, 20.4 billion dinars go to salaries, 3.6 billion to subsidies, and 1.1 billion dinars to operational expenses.

In Libya, a country of 7 million people where hardly any proper services are provided, 2 million people receive salaries. Besides salaries, there are other revenue streams for militias.

The Libyan National Oil Corporation sells oil it cannot export or store on the domestic market at prices far below market value. Militias, leftovers from the 2011 uprising, buy this cheap oil and smuggle it to neighboring countries, filling their coffers.

Chaos benefits those with guns.

Who cares about elections, the will of the people, transparency, or a shared national future?

The standoffs weren’t limited to the Central Bank and oil maneuvers. On August 18, in retaliation for the House of Representatives’ memorandum, Presidential Council Chairman Mohammed al-Menfi held a meeting with commanders and intelligence chiefs in his capacity as Supreme Commander of the Armed Forces—a first of its kind.

On August 23, Dbeibeh made a move he could not follow through on, attempting to bring militias in the capital under control. He established a “high security committee” headed by Interior Minister Imad al-Traboulsi, ordering all militias to vacate government buildings within 24 hours. Did anyone comply? No.

Dbeibeh likely experienced a surge of confidence, thinking that after gaining control of the Central Bank, he was the one writing the militias’ paycheck. He even made enemies within his own hometown. The forces in Misrata, which led the 2011 overthrow of Gaddafi, raised their heads once more and backed Kabir against Dbeibeh. In the meantime, he also clashed with Egypt.

The reason?

Egyptian Intelligence Chief Abbas Kamel, who somehow found time amidst his Gaza mediation efforts, visited Benghazi in the second week of August for meetings. According to reports, Kamel tried to convince Haftar, Saleh, and Hammad to establish a transitional government without the involvement of current political actors. Arab sources suggest the goal was to lead Libya, bogged down by familial, clique, and militia interests, to elections and restore stability with a national government.

From Cairo’s perspective, it would be easier to secure Egypt’s interests if a national parliament and government were formed through elections. Egypt has been troubled by Turkey maximizing its interests through confrontational means under abnormal circumstances. Ignoring objections, the Egyptian administration even invited Hammad to Cairo.

Interpreting Kamel’s initiative as a move to oust the Dbeibeh government, the Tripoli side declared two Egyptian diplomats persona non grata on August 12. Amid all this, the AKP, which often reacts to everything, remained unusually quiet and passive. Clearly, the importance of the “new chapter” with Egypt was significant. Finally, on September 5, National Intelligence Organization (MİT) Chief İbrahim Kalın flew to Tripoli. He held important meetings—what came out of them is anyone’s guess!

It’s likely that while Dbeibeh was trying to gain control of the Central Bank to boost public support through populist spending and buy the loyalty of militia forces, he did not take Ankara’s preferences into account. He not only disregarded Ankara but also fell out with Cairo. Had the rival parties remained in the previous alignment, the opposite would have happened.

Forty-eight hours before Kalın’s visit, the House of Representatives and the Tripoli-based High State Council agreed to appoint the Central Bank’s governor and board members within 30 days. It’s hard to predict the outcome, but this decision sends a message to the Menfi-Dbeibeh duo: “The game is over.”

The uncertainty at the Central Bank is throwing Libya’s “pirate” economy into a deeper crisis. Although the government managed to pay last month’s salaries with existing reserves, this is little more than a one-time fix. In summary, the future of divided Libya remains bleak. The roadmap set by the 2015 Skhirat Agreement was squandered for personal interests. The same goes for 2021. Throughout these processes, Turkey tried to play a leading role. It made deals with one side of Libya, whose legitimacy was disputed, to shape the political process and gain military bases and ports. Despite its assertive stance, Turkey’s capacity to influence developments appears to be severely limited.

While Turkey is normalizing relations with Egypt and the UAE, actors with whom it clashed over Libya, it is experiencing fluctuations with Russia. Egypt, Russia, and the UAE are in a position to say “yes” or “no” to Turkey’s membership in BRICS. And everyone expects Turkey to adopt more cooperative policies. Here comes another test run. In foreign policy, the saying “We’ve boarded a vehicle bound for disaster” continues to resonate.

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Fehim Taştekin is a graduate of Istanbul University, Political Sciences Faculty. He started journalism in 1994 as a reporter.

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The fund created to rebuild Derna, devastated by Storm Daniel a year ago, also serves as a political launching pad for its director Belkacem Haftar, son of the east’s leader.

Cranes scattered throughout the city, construction trucks on the move, and the deafening noise of countless machines: one year after the devastating passage of Storm Daniel through the Mediterranean basin, hitting Libya the hardest, the eastern city of Derna has changed a lot. In recent months, no fewer than 155 building projects have been launched, ranging from the renovation of the university to the construction of new dams, not to mention parks and leisure facilities.

Last February, the government of eastern Libya – a rival authority to the internationally recognised administration based in the western city of Tripoli – created the Libya Development and Reconstruction Fund for this purpose. The fund is led by 43-year-old engineer Belkacem Haftar, one of the six sons of Khalifa Haftar, the commander who controls the east of Libya. Though it has schemes across Haftar-held territory, Derna appears a priority.

On the night of 10 September 2023, torrential rains from Storm Daniel destroyed the two dams located upstream of the city of 100,000 inhabitants, wedged between Djebel Akhdar (the “green mountain”) and the Mediterranean. The unleashed water swept away entire blocks along the Derna River, which cuts the eponymous city in two. According to the official toll, 4,557 people died, 4,227 disappeared and 7,000 families lost their homes.  The tragedy was ascribed to years of neglect, as the dams had not been properly maintained.

At the end of July, 12 officials responsible for managing water resources and maintaining the dams were sentenced to prison terms ranging from nine to 27 years, charged with crimes including negligence, premeditated murder and wasting public money. The sentenced officials did not include senior commanders and members of the armed forces, which managed the crisis response.

‘People want to enjoy life’

Derna has long been marginalised by the Libyan authorities. A hotbed of protest against the rule of long-time autocrat Muammar Gaddafi, the conservative city became in 2014 the first stronghold of the Islamic State group (IS) in North Africa. A year later, IS was driven out by a rival group, the Derna Mujahideen Shura Council (DMSC). From 2018 to 2019, Derna was the scene of a war between this coalition of militias and the forces of Haftar, who conquered the city during a military campaign that saw the commander seize control of all of eastern Libya.

But Derna, with a reputation for hard-line Islamic militancy, was sidelined by the authorities. Its residents, many historically from western Libya, did not benefit from the support of the local tribes that is so important in the east. In the aftermath of Storm Daniel, the survivors of Derna expressed their anger at what they saw as the authorities’ failure to protect them from the floods. According to the UN, most of the deaths could have been prevented if early warning and emergency management systems had been in working order. Nearly a year later, when Middle East Eye visited the city in the summer, the mood had radically changed. “The city is modernising,” Islam al-Mountasser, a 40-year-old shopkeeper, told MEE with a broad smile.

Mountasser now runs a brand-new perfume shop in front of the park on Garden Street, some 600 metres from the Derna River and the buildings that still lie in ruins. “After the storm, Derna was a black hole. We spent 100 days without electricity,”’ he recalled. “I left the city, but the community asked the shopkeepers to come back. When I returned two months later, I was surprised.” The building where his shop was located was reconstructed by Haftar’s fund, while Mountasser redid the interior space himself. He should soon receive 100,000 dinars (around $21,200) in compensation.

“The reconstruction’s impact on trade has become apparent. Business is better than before,” said Mountasser, whose first child was born on the day of the storm. In the city, where posters glorifying Haftar appear on every street corner, as in all the territories of eastern Libya, criticism is rare and discreet. Reached by telephone, a resident told MEE on condition of anonymity that there was less renovation work in the historic centre of Derna, where there are families considered sympathetic to the militias that held power previously, and therefore opposed to Haftar.

“We can see that there are favoured neighbourhoods. Those, like me and my family, who did not welcome the arrival of Haftar’s army in Derna, are now being punished,” the resident said. In a report published on Tuesday, Human Rights Watch said the “slow recovery and lack of a national response plan was having a severe effect on the economic rights of survivors”. “In Derna, the hardest hit city, devastation and damage to infrastructure remains widespread, including to homes, water and sanitation networks, electricity grids, hospitals, and schools. Access to financial and government services is limited and thousands of victims remain unidentified or missing,” the New York-based organisation said. Another Derna resident told MEE they were worried about the speed of the work. “Everything is being built so quickly that I doubt it will be done properly. Today’s brand-new infrastructure may not last,” the person said anonymously.

But outwardly, there is enthusiasm.

In the newly built park opposite Mountasser’s shop, children could be heard playing loudly, running from a slide to a swing. Further away, the rebuilt city stadium attracts older youths. Rajab, a 15-year-old boy wearing a FC Barcelona jersey, stopped his football game to speak with MEE. “We lost our house, we used to live in the city centre,” he said. “We now live with my uncle. But thank God, Derna is fine now. We didn’t have a pitch like this one to play before.” A few metres down the street, the Renaissance Cafe, built by Haftar’s fund, is at full capacity. Mohamed Nasser, its manager, obtained the job in compensation for the destruction of his refreshment bar by the storm. The 25-year-old n reckons his income has increased by 60 percent since then. “People want to enjoy life. They go out more,” he told MEE.

On the walls of his cafe are displayed photos of Haftar visiting Derna, the eastern Prime Minister Osama Hammad and, most prominently, Belkacem Haftar. The latter seems hyperactive, like the fund he runs, which reportedly operates in about 20 Libyan cities and closely oversees Derna’s reconstruction. “We have clear objectives: companies are working day and night, because Derna must be rebuilt – better than before the storm – by the end of 2025,” Belkacem Haftar told MEE. Several companies have reportedly already been dismissed for being late, a fund employee told Middle East Eye. As for the dams, the priority will be to ensure more serious maintenance in the future, a local official told MEE. The fund is currently studying four different proposals. One suggests not rebuilding the dams at all, arguing that the river has been so widened by the storm that there is no longer much risk of flooding.

Politicised reconstruction work

The fund’s operating mode and largesse appear to have earned Haftar some degree of popular support from local Libyans, accustomed to the authorities’ inertia. Or at least, this seems one of the goals. According to Jalel Harchaoui, an associate researcher at the British Royal United Services Institute (RUSI), “there is a real desire on the part of the reconstruction fund to stand out. “They want to get the message across: we make promises and we keep them,” the Libya specialist told MEE.

The fund is also relaunching projects that have been at a standstill for years. In 2005-2008, after the removal of international sanctions imposed on Gaddafi’s Libya in the 90s, coinciding with a global rise in oil prices, Libya experienced an exceptionally prosperous period. The Gaddafi government then launched projects worth tens of billions of dollars, under the supervision of the Organisation for the Development of Administrative Centres (ODAC), then headed by Ali Dbeibeh, cousin and brother-in-law of the current prime minister of Libya’s western government, Abdul Hamid Dbeibeh. But the work was often stalled.

“Everything was so abnormally slow that many projects were bogged down or at a standstill before the revolution of February 2011 [that overthrew Gaddafi],” Harchaoui explained. In January of that year, sit-ins took place on construction sites that were no longer making any progress, he added. “The prices of these projects, at the time, were rather realistic, but they were rarely finished because 30 percent, sometimes more, of the budget often disappeared in bribes,” he added. This is the case of an entire neighbourhood at the western entrance to Derna. The project to build 2,000 apartments by Chinese and Korean companies took the form of concrete skeletons abandoned since 2009.

The construction site restarted a few months ago, with mainly Egyptian and Libyan companies involved. The fully furnished and equipped 200-square-metre apartments are set to be offered for free in December to some of the 7,000 Dernawi families who lost their homes during the storm. So far, none has been rehoused. According to observers, the political dimension of these construction efforts is evident, and it is a policy that was successfully implemented in the past. “This is the strategy of King Idris,” a local journalist who wished to remain anonymous told MEE, in reference to the emir who reigned over Libya from 1951 until the coup led by Gaddafi in 1969.

“Idris ruled over [the eastern region of] Cyrenaica and, thanks to the discovery of oil in the territory in 1959, he developed the region and thus drew [the north-western region of] Tripolitania under his influence to unify the country and abolish federalism in 1963,” he explained. Similarly, Khalifa Haftar is believed to nourish the ambition of controlling the whole country and could use reconstruction as a means to extend his influence to the west. Libya broke down into warring factions after the overthrow and death of Gaddafi in 2011. Fighting in the strategic, energy-rich country rapidly degenerated into a proxy war with foreign powers backing opposing sides.  In 2019, Haftar tried to conquer the capital Tripoli but was defeated by the forces of the UN-recognised government with the help of Turkey. A ceasefire was concluded in 2020 and a period of relative calm followed, despite unsuccessful attempts to reunify the country.

The sinews of war

Last month, Haftar deployed his troops in the southern and western regions of the country, close to the Tunisia-Algeria border, sparking alarm in the international community about the possibility of a resumption of fighting in the country and beyond. Now, if the eastern leader decides to heed the calls for “wisdom and restraint” and opt instead for a continuation of his “diplomacy of concrete”, money will be needed. While money is not lacking in Libya, the financing of the reconstruction fund remains opaque, as does the cost of the work. Belkasem Haftar claims to benefit from the part of the national budget dedicated to development. But the long-time governor of the central bank, Sadik al-Kabir, has officially denied any payment.

However, the tensions that arose nearly a year ago between Dbeibeh, the western prime minister, and Kabir following disagreements over economic policy are said to have pushed the latter closer to the eastern camp. According to analysts, arrangements were found between the central bank and the eastern administration so that the east’s banks, to which Haftar’s government was indebted, would receive assets allowing them to extend credit to the authorities. However, since August, the central bank has been shaken by a deep crisis after it was besieged by fighters who reportedly tried to force Kabir to resign.

On 18 August, Libya’s presidential council, which is aligned with Dbeibeh, unilaterally announced the dismissal of Kabir, who fled the country. In response, Libya’s eastern government suspended all oil production and exports. The crisis of the central bank, the sole legal repository for Libyan oil revenue, which pays state salaries across the country and supports projects nationwide, could jeopardise the funding of Haftar’s financial arm and his goals of cementing power.

_____________________

Fehim Taştekin

As Turkey normalizes its relations with Egypt and the UAE—with whom it has clashed over Libya—it experiences fluctuations in its ties with Russia. All these actors are in a position to approve or reject Turkey’s membership in BRICS. And everyone expects Turkey to adopt more cooperative policies.

As the ruling Justice and Development Party (AKP) government pursued its goal of joining BRICS by employing a strategy of leveraging tensions between global South and North blocs, Turkey faced escalating challenges in the regions where it had embarked on new ventures. In Syria, Turkey’s allies began to turn on each other, and in Libya, the situation grew increasingly out of control.

Last week, the country focused on the newly opened chapter marked by Egyptian President Abdel Fattah el-Sisi’s visit to Ankara. However, during this time, the main topic on the agenda with Egypt—Libya—was witnessing conflicts that exceeded Ankara’s capacity to resolve. Despite their rivalry in Libya, Turkey and Egypt found themselves in a stalemate, forcing them to keep an eye on each other.

The actors in Libya did not maintain consistent relationships with the foreign powers involved in the country, leading to a complex and unpredictable web of alliances. As alliances continuously shifted, the chaos escalated to a point where no external power could control the situation alone.

To understand the current dynamics, it’s important to look back.

In 2019-2020, the Egyptian, UAE, and Russian-backed Libyan National Army, led by Khalifa Haftar, attempted to capture Tripoli. Turkey’s intervention thwarted this effort. However, when the Tripoli forces attempted to advance eastward, they were stopped at the Sirte-Jufra line. Turkey’s support was insufficient to push further.

In February 2021, under the auspices of the UN, a roadmap was adopted to establish the Presidential Council and the Government of National Unity (GNU), with the aim of leading the country to elections and unifying institutions. This roadmap, coupled with the ongoing deadlock, prompted the rival parties to reposition themselves. Egypt established bridges with Tripoli, while Turkey did so with Benghazi.

Abdul Hamid Dbeibeh, who was elected to lead the GNU, was supposed to guide the country to elections by December 24, 2021. However, not only did he fail to fulfill this obligation, but he also clung to power beyond his term, using Turkey’s support to consolidate his position. He struck new deals with Ankara and disregarded domestic objections and criticisms.

As the situation in Libya continued to evolve rapidly, former Interior Minister Fathi Bashagha, who had been a close ally of Ankara during Turkey’s intervention, was appointed head of an alternative government by the Tobruk-based House of Representatives in 2022, which did not recognize Dbeibeh’s legitimacy.

Bashagha’s attempt to march on Tripoli was unsuccessful, and he stepped down in 2023. Meanwhile, Ankara took steps to de-escalate tensions with House of Representatives Speaker Aguila Saleh and Haftar.

Cairo also began working with the Dbeibeh government. While the UAE maintained its support for Haftar, it also assisted Dbeibeh’s oil and gas projects in Ghadames as a country that had normalized relations with Turkey.

After the death of Wagner Group leader Yevgeny Prigozhin, Russia restructured its militia presence in the region under the name “African Legion” and adjusted its relationship with Haftar. The visit of Russia’s Deputy Defense Minister, Yunus-Bek Yevkurov, of Ingush origin, to Benghazi confirmed that Russia would not withdraw from the Libyan game.

In response, the United States, which had entrusted Libya to its “project partner” Turkey after the assassination of Ambassador Chris Stevens by jihadist allies in Tripoli in 2012, re-entered the scene to balance Russia. A private military company, Amentum, working with the Pentagon and the State Department, was deployed to unify the militia forces in and around Tripoli.

In recent weeks, U.S. Special Envoy for Libya Richard Norland and Chargé d’Affaires Jeremy Berndt increased their engagements with local actors, while AFRICOM Commander General Michael Langley visited both Tripoli and Benghazi.

While a scenario of unresolved but relative stability continued, the situation suddenly escalated in August. Haftar’s forces began advancing southward, targeting Ghadames and aiming to expand control toward the Algeria-Tunisia border, while Turkey—typically the “protector” of Tripoli—remained notably silent.

Meanwhile, Dbeibeh had been sharpening his stance against Central Bank Governor Sadiq al-Kabir since October 2023, as Kabir had been curbing the government’s uncontrolled expenditures. Dbeibeh sought ways to sideline Kabir, who had been working closely with the U.S., the UK, and Turkey.

Kabir had also angered Haftar’s camp by blocking Bashagha’s access to the Central Bank’s resources when he was head of the House of Representatives-affiliated government. However, Kabir occupied a unique position as the man overseeing the distribution of funds to rival factions in Libya. He had the backing of Western powers involved in Libya, which granted him a degree of immunity.

For the U.S., which masterminded the intervention that destabilized Libya, the most direct way to control the country was through the Central Bank.

Internationally, the sale of oil is monopolized by the Libyan National Oil Corporation, with the revenue deposited into an account at the Libyan Foreign Bank in New York. The authority to disburse these funds rests with the Central Bank of Libya, making Kabir the financial patron of both the Tripoli/Misrata and Benghazi/Tobruk-based political and military powers.

Dbeibeh increased pressure on Kabir by surrounding the Central Bank with militias. On August 12, Norland visited Kabir, showing American support against attempts to besiege the bank, forcibly remove him from office, and abduct its employees.

As pressure on the Central Bank intensified, the House of Representatives issued a memorandum on August 13, declaring that Dbeibeh’s government had ended and that the cabinet led by Usama Hammad was the sole legitimate government.

Additionally, Aguila Saleh was declared the Commander-in-Chief of the Libyan Armed Forces, a decision supported by Haftar. In response, on August 18, Dbeibeh issued a decree from the Presidential Council calling for Kabir’s dismissal.

Resisting the decision, Kabir sought refuge in Istanbul, while militias kidnapped the bank’s IT director in an attempt to seize the Central Bank’s codes.

According to Kabir, the militias were threatening and intimidating bank employees, occasionally kidnapping their children and relatives to force compliance.

Although Abdulfattah Abdulgaffar, who was appointed acting governor of the Central Bank, gained access to dinar accounts, it was reported that he could not access the dollar reserves. Even though the new administration had access to SWIFT codes, it was predicted that the bank’s international relations would not normalize without the U.S.’s green light.

Following a warning from the U.S. Treasury, foreign banks refused to conduct business with the Central Bank of Libya until a clear leadership was established. Essentially, the U.S. was saying, “You cannot make changes at the Central Bank without my approval.”

Kabir also maintained a good relationship with Erdoğan, and it was reported that Turkey supported Kabir’s return to his position until a joint solution could be found.

In such crises, the opposing side is always prepared to make a move. Haftar immediately shut off the oil valves, signaling that “if Dbeibeh seizes control of the Central Bank, he will lose access to oil revenues.”

***

Fehim Taştekin is a graduate of Istanbul University, Political Sciences Faculty. He started journalism in 1994 as a reporter.

________________

Dr. Ufuk Necat Taşçı

There is no doubt that elections need to be held in Libya. However, the way to hold fair and equitable elections is possible with a constitution drawn up by mutual consent.

There are many hot topics occupying the global agenda. While there is the genocide in Gaza on one side, the Russia-Ukraine war and the tension between Israel and Iran on the other, the process in Libya has remained in the background like many other issues. However, the ongoing activity in Libya for a few weeks has reached a level that should not be ignored due to its possible consequences.

On August 13, the House of Representatives in Eastern Tobruk, backed by Khalifa Haftar, held a vote to end the term of the government of Abdulhamid Dibeiba. The House declared the government of Osama Hammad, based in the east, as the sole “legitimate” government until a new and holistic government is elected. The House of Representatives also declared pro-Haftar Speaker of the House Aqila Saleh as the commander of the “Libyan Armed Forces.” However, according to the Libyan Political Agreement of 2021, this title was to belong to the head of the Presidential Council and two of his deputies until democratic elections were held in the country. A few days after this move, the situation in the country became even more tense when Prime Minister of the Libyan National Unity Government (NUG) Abdulhamid Dibeiba dismissed Siddiq al-Kabir, the Governor of the Central Bank since 2011.

Mutual decisions cause tension

Another known fact is Siddiq al-Kabir’s very close relations with the United States (US) and his anti-Dibeybe stance. These developments were followed by the mobilization of Haftar’s armed militias around Tripoli. In the face of this chain of events, the United Nations Security Council (UNSC) made a statement demanding that military conflict be avoided, that the UNSC resolutions in 2023 be adhered to by referring to the 2020 ceasefire agreement, and that the roadmap in the Libyan Political Dialogue Forum be adhered to. While Haftar declared that he did not accept the removal of Kahbir, the eastern-based Hammad Government and Parliament Speaker Saleh decided to halt oil production in the country.

The problems in Libya can be solved by an organization consisting of several actors, including Turkey, first providing the basis for a final agreement on the constitution and then establishing a security mechanism to ensure ballot box security throughout the country during the election process.

Currently, Abdel Fattah Abdel Ghaffar, who was appointed as acting Central Bank Governor by the Presidential Council, is making efforts to prevent a financial crisis in the country and to prevent salary delays. The Libyan High Council of State referred to the Libyan Political Agreement for a permanent solution to this problem and invited all parties to dialogue. The President of the Libyan High Council of State, Mohammed Miftah Takala, warned to hold elections on the basis of the agreements made on March 10 between the Tobruk House of Representatives, the Presidential Council and the High Council of State under the auspices of the Arab League.

Past problems in Libya

These current events, which are clearly difficult to explain in just a few paragraphs, are actually a residue of past promises that were not kept and agreements that were not kept. We can see this contradiction on many occasions, especially on the Eastern (Haftar) side. Despite the ceasefire signed in 2020 and the agreements that followed, Haftar and Haftar supporter Salih, who unilaterally established parallel governments, have long been trying to move the country’s capital from Tripoli to Sirte. Similarly, although the eastern-based parliament and Haftar are trying to create the image that they are not breaking the agreements made to date, it is another known fact that Haftar unilaterally declared the Suheyrat Agreement and the presidential council “illegal” in 2017.

While Kebir’s agreement with the US and his “untouchability” since 2011 are another mystery, the billions of dollars of support Haftar, who reacted to his removal from office, received from Russia as early as 2024 is another issue. Although the Libyan dinars previously printed by Russia were declared “invalid” by the Central Bank of Libya, it is known that these currencies are being used in the market.

In short, the situation in Libya is much more complicated than it seems and is an equation with many unknowns. In a sociology where a population of around 7 million consists of over a hundred tribes and hundreds of armed individual groups, resolving such crises is of course not easy. However, the mistakes that the United Nations (UN) Libya representatives have repeatedly admitted after leaving office, their adherence to bilateral motives with unknown details instead of legitimate authority and agreements signed at the UN, and the network of relations of the US, France and Russia that are contrary to UNSC decisions have brought the process to this point in Libya.

Turkey’s position as one of the decisive forces in the country in this picture may be preventing a war that could have broken out much earlier. However, there are also international actors who are trying to interpret the support that Ankara gave to the UN-backed government at the request of this government, for the benefit of some, through other actors who have established illegitimate relations in the background.

Elections are a must in Libya

There is no doubt that elections need to be organized in Libya. However, holding fair and just elections is possible with a constitution that is prepared by mutual consent. Everyone knows that healthy results cannot be obtained from an election that will take place on the eastern side under the shadow of the weapons of the Haftar militia. In addition, there is the fact that Imad El Sayeh, who has been in office for years despite all the chaos, just like Kebir. Sayeh, the head of the Libyan High Election Commission, has relations with France, another obstacle to a possible “objective” election process. We can say that the fact that France and Egypt called for immediate elections shortly before the current events is closely related to this and is not well-intentioned.

Turkey’s transition to a normalization climate in its new foreign policy dynamics over the last few years has helped it gain more influence in regional events and thus prevent crises. However, other actors need to approach the Libya case with the same sincerity.

Although Haftar and the groups supporting him initially recognized the political authority created by the Libya Political Agreement signed at the UN in 2015, they later opposed the agreement in order not to lose their own questionable legitimacy and moved the House of Representatives from Tripoli to Tobruk. In other words, the legitimacy of the side that currently declares the Dibeybe government illegitimate in Libya should have been put into question long ago. Despite the hypocritical policies that ignore this fact and attribute disproportionate legitimacy to the Eastern side, Turkey is currently seeking to establish a basis for dialogue with both sides. Therefore, the problems in Libya can be solved by an organization consisting of several actors, including Turkey, first providing the ground for a final agreement on the constitution and establishing a security mechanism that will ensure ballot box security throughout the country during the election process. However, the real problem in Libya stems from the fact that other actors, primarily UN officials, the US and Russia, do not really want a solution and are taking advantage of the conflict environment.

***

[Dr. Ufuk Necat Taşçı is a faculty member at Çanakkale Onsekiz Mart University.]

____________________

Ben Fishman

Instead of civil war between armed groups, a new kind of war is being fought over Libya’s vast wealth—especially control of the central bank and oil production.

Libya continues to descend into chaos as the conflict over the future of the Central Bank (CBL) continues. Sadiq al-Kabir, the long-serving governor of the bank, fled the county due to threats against him and his staff. The bank’s operations ground to a halt, threatening the financial system within the country and international confidence in the bank itself.

Instead of another civil war with armed groups, this war is being fought over Libya’s significant wealth—especially control of the central bank and oil production. More broadly, the country’s illegitimate leadership class has driven Libya further into chaos for their own gain. Without a strong international intervention, which could take advantage of the current financial disaster, Libya’s political environment will further deteriorate, even if the immediate banking crisis is temporally resolved.

Dysfunctional politics

The latest UN-sponsored initiative announced on 2 September requires some background on the evolution of Libya’s political institutions. The purported agreement on the future of the Central Bank is between the House of Representatives (HoR) elected in 2014 and the High Council of State) (HCS) formed as part of the Libya Political in 2015 on one side and the Presidential Council on the other. This is an unusual formulation because the HoR and HCS never agree. They have purportedly now agreed on an alternative transitional arrangement following al-Kabir’s departure.

The Presidential Council grew out of the 2021 Libya Political Dialogue Forum after the 2019-2020 civil war. The three-member Presidential Council was essentially a non-factor, ceding most of its nominal authority to the Government of National Unity and its prime minister, Abdul Hamid Dbeibeh, who was in office more than two years after his term was set to expire. Dbeibeh’s rift with al-Kabir was over spending, which sparked the latest crisis. The Presidential Council ousted al-Kabir, citing its constitutional right—a dubious legal claim that was immediately challenged.

The council then appointed a new governor, Abdel Fattah Abdel Ghaffar. This version of the CBL tweeted on 2 September that its functions are “back to business as usual.” In a press conference two days earlier, Abdel Ghaffar pledged “transparency and disclosure to the supervisory authorities related to the bank and will not hide…data.”

Although the new CBL now controls the physical building—and, according to one report, the SWIFT codes—it seems unlikely that the bank’s international relationships will return to normal absent an internationally agreed resolution to the banking crisis. It may be able to pay the majority of Libyans on public sector payroll in dinars, but the dinar will continue to slide as the banking system hangs in the balance.

Over the years, any potential Libyan agreement has either been stymied by the commander of the eastern-based Libyan National Army (LNA) Field Marshal Khalifa Haftar or international spoilers – or both. During the several rounds of negotiating the LPA, Haftar always found a way to say no. His counterparts in the West were certainly not innocent, but chasing Haftar proved futile, as demonstrated most egregiously when he attacked Tripoli in 2019. And when elections were planned for December 2021, Haftar’s candidacy was one of the main stumbling blocks to postponing them indefinitely.

Oil used as leverage

Egypt has supported Haftar throughout, while Turkey saved Tripoli in 2020. But today, Haftar’s most threatening alliance is with Russia, who will certainly not let the battle for Libya’s wealth go to waste. That certainly will include playing with Libya’s oil production.

In early August, Saddam Haftar, the unforgiving son of Khalifa Haftar, shut down the Sharara field in southwest Libya production by 300,000 barrels per day out of almost 1.3 million bpd reported in late July, according to Libya’s National Oil Corporation (LNOC). By 24 August, production had decreased again to less than 600,000 bpd, and the NOC declared force majeure on several of the fields, most of them shut down by Haftar to establish leverage over the contest for the CBL.

Production decreased as low as 300,000 bpd, with only the westernmost Waha field running consistently. AGOCO has resumed production by 140,000 bpd, but mostly for domestic refineries to feed the local power grid, not exports.

Once the NOC declared force majeure, international oil prices spiked 2-3%. Prices have since settled back down due to other factors, such as a planned increase in production by OPEC+ and lower Chinese demand, but Libya’s fluctuations indicate how variations in its production will continue to have a significant impact on the price of oil. One energy analysis firm estimates Libyan production could stabilise between 300,000 – 400,000 bpd if Waha remains open—even if output is reduced and AGOCO-run fields continue to operate.

Other experts are more bullish and believe the crisis will quickly resolve itself. Current oil terminals are offloading spare capacity from excess storage, but that will soon cease, so the actual impact of the stoppages will appear soon. Either way, the process of resuming oil fields will not be instantaneous.

International leverage

Unlike previous political negotiations in Libya, where the US and its European partners failed to lean sufficiently on Libyan and international parties who prevented stabilising Libya, Washington now has significant leverage to address the crisis over the central bank.

UNSMIL—the UN Special Mission in Libya—has convened a negotiation forum to resolve the crisis over the CBL. To support these negotiations, the US can threaten banks not to trade with the CBL until an acceptable, transparent resolution is resolved. Because major banks have reportedly stopped dollar transactions with the CBL, US support for the UNSMIL-led process should have great weight—significantly more than the traditional spoilers can bring to bear.

In an even more extreme proposal, the US and its European partners can employ the same tactic to resolve the longstanding dispute about forming a new technocratic government to help stabilise the country. Such a government would face threats from armed groups, but if these groups are starved of funds, they may concede. It may also create time and space for alternative Libyan coalitions to form from the population and replace the political elite who have long treated Libya as their personal bank accounts.

______________

Joshua Yaphe

Elections have never been in the interests of any of Libya’s power brokers and will likely remain postponed indefinitely.

Abdulhamid al-Dbeibah is the Prime Minister of the Government of National Unity (GNU) based in Tripoli and the political face of one of the wealthiest business families to have survived Libya’s transition from authoritarian rule under Muammar Gaddafi to the patchwork landscape of militias and councils today. In the last three weeks, he has succeeded in alienating both the militias that form his most vital constituency and the international community that he so desperately relies upon for his legitimacy. 

Perhaps he genuinely believes that he can somehow unite the rival factions and increase his government’s share of national resources, thereby centralizing power and signaling that he is truly irreplaceable. However, his recent moves are more likely a cynical effort to forestall his inevitable ouster, buying him a little more time in which he can create the appearance of a man in control of his destiny as he hopes that circumstances change and his fortune improves.

Elites and Elections

The GNU was launched in February 2021 in an effort to reform and revitalize the government in Tripoli, following two attempts by Khalifa Haftar’s National Army to seize the capital. It was in line with the spirit of the Political Agreement of 2015, which produced the Presidency Council as a centralized executive branch in Tripoli and the Higher Council of State as an advisory body coordinating decisions between the two governments in eastern and western Libya. These were always interim arrangements in the minds of the UN Security Council member states, who envisioned moving quickly toward elections in which the Libyan people could express their will about the future of the state. 

Morocco hosted talks of a “6+6 Committee” that failed to deliver a roadmap for elections in June 2023 but was able to issue recommendations for a set of procedures and regulations that should appeal to both sides. The government in the West has made vague promises to hold elections before Revolution Day on February 17, and the government in the East has repeatedly asserted that it will support elections after a broader unity government is formed. 

However, elections have never been in the interests of any of these power brokers and, therefore, will likely remain postponed indefinitely. Elite families on both sides now hold their respective institutions captive, using them as a platform for extending lines of patronage while holding the UN and international oil consumers hostage to their local agendas. In that sense, the relative calm of the period since 2021 has provided breathing room for key political and military actors to entrench themselves and explore common interests.

The United Arab Emirates has helped broker an understanding between Haftar and Dbeibah on sharing oil revenues. At the same time, Turkey and Russia have reached a détente that allows them to expand their own military basing arrangements in the western and eastern regions, respectively. 

Leap of Faith

Over the last month, Dbeibah has upset the balance and provoked such a strong reaction that the equilibrium probably cannot be restored. He has effectively seized the Central Bank, probably in an effort to gain a greater share of the budget and secure access to the foreign reserves. He has also attempted to unify the command structure and exert authority over the militias in Tripoli, probably in an effort to reassure his political allies and the public that he is still in control. 

Military Restructuring 

Dbeibah’s close ally at the head of the Presidential Council, Mohammed al-Menfi, gave a speech on August 18 (Armed Forces Day) calling for unifying the militias and, in his capacity as Supreme Commander of the Armed Forces, convened the first-ever meeting of commanders and intelligence chiefs. 

On August 23, Dbeibah launched a Supreme Committee for Security Arrangements, headed by Minister of Interior Emad al-Trabelsi, who immediately issued an order for all militias to evacuate government buildings within twenty-four hours. 

The new Supreme Committee is nominally tasked with supervising the withdrawal of all units to their headquarters, relinquishing control of all public buildings to the control of the Ministry of Interior, turning over all private properties to their proper owners, removing their checkpoints and leaving them in the control of the MOI, subjecting their prisons to government inspection, and submitting control of all ports of entry to government authorities. 

Central Bank Closure

On August 16, the Presidential Council voted unanimously to remove Central Bank Governor Sadiq al-Kabir on the grounds that his term had long since ended and appoint a new Board of Directors. They also announced a committee to investigate mismanagement by the Central Bank and the need for a “fair distribution of state revenues.”

Armed men arrived to seize the Central Bank headquarters in Tripoli only to find the premises locked and the staff dismissed on an extended “bank holiday,” according to a video posted on social media. 

Mohammed al-Shukri, who had been nominated for the post in 2018 but never assumed the duties, declined the offer this time around. Deputy Governor Abdul Fattah Ghaffar is now in charge, though only in an acting capacity, while various representatives from the two governments are exploring the idea of reaching a compromise that will reassure international markets. 

Dbeibah and his allies have forced through these measures in the hopes that they will convey strength and purpose, signaling that they are indispensable for stability in the West and irreplaceable in office. Neither is true. The loyalty of the militias in Tripoli only extends as far as they receive their paychecks. If Dbeibah is gambling that the militias hate each other more than they hate him, and his promise of a greater share of the national budget will rally their confidence in him, then he is likely to be disappointed. 

Dbeibah is a serious politician, however, and his latest moves were probably motivated less by an overestimated sense of his own self-worth and more by a fear that his removal from power was imminent. He cannot compete with eastern Libya in terms of natural resources or Foreign Direct Investment, and it shows when the newspapers and social media proliferate with images of long lines at fuel stations in the West and Emirati property developers signing deals for major projects in Benghazi. An MOU that he signed in March granting Turkey wide latitude for basing troops in Libya came under sharp criticism as a form of neo-colonialism when the details became public on August 12. 

Most importantly, Dbeibah’s ally as head of the Higher Council of State, Mohammed al-Takala, lost to his rival Khaled al-Mishri in second-round voting on August 6 and has overstayed his tenure in office. Takala has appealed to the courts, and now he and Mishri are each trying to convene the body as competing presidents. If fully empowered, Mishri could strike a deal with Aquila Saleh, Speaker of the House of Representatives (HoR) in eastern Libya, and work to convince the UN of the need for a new unity government in advance of elections. 

Watching and Waiting

Khalifa Haftar, Aquila Saleh, Osama Hammad, and others in the East are biding their time with the expectation that Dbeibah will falter. The HoR has issued endless proclamations—declaring the removal of al-Kabir illegal, the Presidential Council illegitimate, the oil fields under force majeur, the transfer of the title “Supreme Commander of the Armed Forces,” etc.

Throughout all of this drama, Haftar’s son Saddam has been leading his land forces on desert patrols on raids of drug dealers and human traffickers in the South in order to show the public that while politicians bicker, his family is achieving tangible gains in promoting border security and public safety. As long as the HoR remains united, Osama Hammad presents himself as a credible alternative, and Khalifa Haftar remains in good health and ready to mediate among the factions, the government in the East can watch and wait. 

They would be right to keep their distance. Dbeibah can create new security structures, lock down the Central Bank’s headquarters, and jettison the principles of broad consensus that underpinned the Political Agreement of 2015 and every attempt at national dialogue ever since. He may even try to hold a referendum on a constitution accompanied by-elections sometime this winter, though they would probably only be held in the West, and their legitimacy would come under attack.

With all of these moves, Dbeibah is probably only buying six months more time in office. If anything, the last three weeks have shown that the situation is fluid and unstable. Dbeibah and his allies have overextended their authority, and the international community does not want to write him a blank check.

 ***

Joshua Yaphe, Ph.D., is a Visiting Fellow at the Center for the National Interest. For fifteen years, he was the lead analyst for the Arabian Peninsula at the State Department’s Bureau of Intelligence and Research.

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Bottom Line up Front

• The ongoing rift between political leaders in eastern and western Libya briefly roiled the oil market last week, as both sides seek to control the state’s assets to further their objectives.
• As has been the case in several regional countries, United Nations, U.S., European, and other mediators have failed to persuade rival factions to implement a roadmap to forge a unified political and security structure.
• Libya’s political crisis has provided opportunity for regional and global actors to empower Libyan factions to advance their agendas.
• The infusion of outside weapons technology to Libya’s warring groups sets the stage for the rise of potentially destabilizing non-state actors.

More than five years of international and regional diplomacy has failed to unify the country still divided between rival factions and governmental administrations based in eastern and western Libya – each of which has solidified its grip on power in their respective regions since the overthrow of dictator Muammar Qadhafi in 2011. 

The failure to forge a unified political and security structure has, in turn, enticed regional and global powers to forge ties to the various factions in an effort to advance their own agendas – and not those of the Libyan people. In addition, the provision of increasingly sophisticated weapons to the warring Libyan factions, particularly armed drones, is not only fueling increasingly lethal warfare between Libya’s groups but also increasing the potential for Libya’s militias to intervene outside Libya or threaten regional commerce.

U.N. mediators appear increasingly pessimistic about the prospects for a resolution in Libya. For several years, U.N. mediators have sought to broker eastern and western Libyan concurrence on a roadmap consisting of uniting their separate administrations into one governing body, and holding nationwide elections for a president and a unified parliament.

However, reflecting the stalemated diplomatic process, Stephanie Khoury, the head of the U.N. mission in Libya, told the U.N. Security Council on August 20: “In the absence of renewed political talks leading to a unified government and elections, you see where this is heading—greater financial and security instability, entrenched political and territorial divisions, and greater domestic and regional instability.”

The difficulty mediators have faced in brokering a resolution between Libya’s rival governments resembles the challenges diplomats have faced in resolving conflict and curbing the rise of non-state actors in several of Libya’s neighbors. In neighboring Sudan, Saudi Arabia, the United States, European, African, and other Arab state mediators have failed to broker more than brief ceasefires in the war between the Sudan Armed Forces and the paramilitary Rapid Support Forces (RSF) that broke out in the spring of 2023.

In Yemen, U.S., U.N., and regional mediators, particularly the Sultanate of Oman, have repeatedly failed to forge a settlement between the Houthi movement (Ansarallah) and the U.N.-recognized but politically marginalized Republic of Yemen Government. The lack of a resolution between the Houthis and the Government has provided Iranian leaders with what they perceive as justification to provide the Houthis with increasingly sophisticated weapons technology such as ballistic and cruise missiles and armed drones.

The Houthis have used this weaponry to emerge as a significant non-state actor that is challenging the U.S and other world powers by attacking commercial shipping transiting the Red Sea as long as Israel’s offensive against Hamas in the Gaza Strip continues.

In Libya, no militia has, to date, emerged as a threat to global commerce or regional stability to the extent the Houthis have in Yemen. However, one group in particular, the Libyan National Army (LNA) of eastern Libya-based strongman General Khalifah Haftar, has been reportedly receiving progressively sophisticated arms provided by an array of regional and global powers, including Russia, the United Arab Emirates (UAE), and neighboring Egypt.

He has also placed some of the military bases he controls at the disposal of both Russia and the UAE to facilitate arms shipments to the RSF in Sudan. At the same time, Haftar’s rival, the U.N.-backed government in Tripoli and allied militias were able to thwart Haftar’s attempts to capture Tripoli and consolidate his control over the country in 2019-2020 with the help of armed drones and armor supplied by Türkiye.

The political divisions in Libya have served as an arena for the regional actors to advance divergent agendas and try to undermine each other by proxy. Egypt and the UAE have backed Haftar in part because of his staunch anti-Islamist ideology that opposes the reliance of the Tripoli government on militias linked to the Muslim Brotherhood movement.

Türkiye, by contrast, has engaged regional Muslim Brotherhood-inspired movements and views Haftar as a right-wing figure dedicated to reducing Ankara’s regional influence. Russia, for its part, sees Haftar’s control of most of Libya’s oil fields as a tool in Moscow’s global competition with the United States and its European partners, all of which are backing Ukraine.

Domestically, Haftar and his Tripoli rivals have sought to control state resources as a means of outflanking each other strategically. The battle erupted again on Monday, August 26, when a Tripoli government delegation attempted to take over the offices of Libya’s Central Bank.

Under applicable U.N. Security Council resolutions, the Bank is the only legally-recognized depository for Libyan state oil revenues. About 95 percent of Libya’s state budget is dependent on those revenues, meaning that whoever controls the Bank and other institutions that oversee it can exert essential control over the economy.

The attempted takeover of the Bank represented an effort by Tripoli to implement its declared replacement of Central Bank Governor Sadiq al-Kabir, a Haftar ally, arguing he mishandled the country’s oil revenues. A week earlier, Tripoli announced it had appointed Mohamed al-Shukri as Bank governor. However, Kabir, governor of the institution since late 2011, and with Haftar’s backing, refused to step down and Tripoli’s nominee, Shukri, turned down the job offer, rejecting “any bloodshed between Libyans on his behalf.”

Failing to succeed to gain control of the Bank peacefully, the Tripoli government raid of the Bank offices reflected its attempts to use a modest amount of force to gain control of the institution and its financial resources. The rival attempts to control the Central Bank triggered militias to mobilize on both sides, although it did not appear that any actual armed clashes have taken place.

Yet, even though no Libyan faction claimed they sought to deliberately harm global commerce or the world economy, as the Houthis in Yemen have done through their attacks in the Red Sea, the escalation of Libya’s political crisis nonetheless introduced new world economic risks. On August 28, Haftar’s allies in eastern Libya sought to shut down the country’s oil production entirely until Tripoli relented on its attempt to replace the Central Bank governor.

Libya produces about 1.2 million barrels of crude oil per day, and Haftar’s demands reduced production by about 500,000 barrels per day – adding to 300,000 barrels per day in production shut down earlier by the dispute. Oil engineers said Libya’s Sarir field had almost completely halted its 209,000 barrel per day output as a result of the threats. However, some accounts suggested the production disruption was either less extensive than feared, or temporary, and world oil prices largely shook off the Libya crisis. Helping keep prices from a sustained spike were market forces predicting a global economic slowdown.

Experts assessed that, if the world oil market were in a period of greater supply constraints, the Libya unrest might have had a more significant effect on prices. Some speculated that Moscow has purposely urged its ally, Haftar, to undertake actions to spike global energy prices, in an effort to harm the West economically as retaliation for supporting Ukraine.

Whether or not Russia is instigating unrest in Libya, the escalation of tensions in Libya demonstrated the ability of non-state actors in the region’s intractable political disputes to take actions that potentially produce an outsized effect well beyond their countries’ borders. These ongoing crises also illustrate the limitations that existing diplomatic processes and forums face in regional conflict resolution.

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Giorgia Valente

While international eyes flit between Russia-Ukraine and Israel-Palestine, Libya faces a potential revolution after the Central Bank collapse, with tensions between rival governments and armed militias rising.

Libya straddles the verge of a revolution, with the Central Bank having just collapsed and the growing tensions between the Government of National Accord (GNA) headed by Abdul Hamid Dbeibah in Tripoli, a government in Benghazi supported by the warlord Khalifa Haftar, and the rising power of armed militias in the capital.

Mohamed Khaled Elghuel, Chairman of the Peace and Prosperity Party in Libya, explained to The Media Line that the country currently faces two main scenarios: either a revolution that may be worse than the one of 2011 if no actions are taken to end this endless circle of dysfunction or a total reset towards a federal system. 

Libya went through the collapse of the Central Bank in the past few days, and this poses a serious threat to the country’s stability since armed militias could easily take over. The bank dominates the Libyan economy, owning the two main commercial banks and holding $27bn in reserves, most of it from oil revenues.

Sadiq al-Kabir, the sacked governor, has recently started attacking Dbeibah’s overspending and is now seen to favor the forces in the country’s east. Abdel Fattah Ghaffar, the new interim deputy governor appointed by the Tripoli-based government, held a press conference in the capital and insisted he could ease the current liquidity crisis, pay unpaid salaries within two days, and be accountable to a board of governors.

Kabir has run the bank since 2011, the year that Col Muammar Gaddafi was toppled with Western backing, leading to the paralyzing split between the west and east of the country. The rival eastern administration has opposed Kabir’s sacking and said on Tuesday it would continue “suspending all oil production and exports until Kabir is reappointed,” citing “force majeure.” The affected oilfields constitute about 90% of the country’s oilfields and terminals.

Kabir said on Tuesday, for a second day running, the bank had been unable to operate due to threats from militia and the kidnapping of four staff, leading him to warn that August salaries may not be payable. 

“The current events are caused by different historical reasons. Libya’s independence was historically a foreign decision more than a national process. In fact, Libyans do not have a national charter that sets peace within the country as its principle. This is why we are still facing inner disputes,” Elghuel stated. 

“On top of that, since the 1960s, there was not a clear plan adopted by the country to invest the money coming from oil revenues, which turned Libya into a rentier state with an endless circle of corruption that led to social uprisings like the one in 2011. The current situation may lead to a far worse scenario”, he added. 

According to a recent report by the Central Bank of Libya, the country’s oil revenue totaled 51 billion dinars from the first of January until July 31, 2024. Last year, oil income reached 99.1 billion dinars, a decrease from 105.4 billion dinars in 2022. This fluctuation highlights the volatile nature of Libya’s oil-based economy, which is influenced by global oil prices and domestic production challenges. Moreover, according to a report from the National Institution for Human Rights in Libya, from the end of December 2023, the poverty rate in the country has risen to 40%.

“Our economy is shrinking; our expenditure is increasing, but the corrupted parties are only benefitting from this. This system created the dichotomy of a lot of billionaires with 40% of the people under the poverty level,” Elghuel stated. 

Aside from economic issues, Libya also faces a lack of security since no Western nation has shown interest in stabilizing Tripoli’s political system and has reduced everything to its personal goals. The Europeans are primarily concerned with irregular migration and thus find it convenient to deal with a semi-anarchic situation. The United States is concerned with terrorism and the spread of Islamist organizations such as ISIS throughout the region. It pays no concern over who governs Libya as long as extremist groups are contained. 

This vacuum allowed external entities, mostly Russia and Turkey, to take over militarily.

“Currently, there are foreign powers competing with one another. Russia recently deployed 1800 fighters to eastern Libya to have a strategic asset close to the Sahel region, where Wagner is also present,” Omar Misbah, Local Coordinator at the Institute for Integrated Transitions (IFIT), said to The Media Line. 

“The US and European countries, like France and Italy, maintain their small military influence in the country to monitor terrorism and irregular migration. While Turkey aims to expand its influence by gaining the trust of both the Eastern and the Western governments, trying not to be an obstacle to Egypt’s plans, too. Libyans need these foreign powers out to gain back control of the country,” he added.  

“The possibility of Libya becoming a field for proxy wars is plausible in the future since we see conflicting actors being present in the country and destabilizing it as well. You have the US vs Russia, and Italy, France, Turkey, Qatar, the Emirates, and Egypt competing over influence”, stated Ibrahim M.S. Grada, Former Libyan Ambassador to Sweden and Former UN Senior Advisor. 

This overall chaos may increase the threat of ISIS and even Iran’s influence in the country.

“With a chaotic scenario like the one we are seeing, ISIS may be able to recruit more people who are struggling to survive economically and are poorly educated. At the same time, Iran could use Libya as a tool to compete against Saudi Arabia, The Emirates, and Qatar while harming Europe by creating a new axis of terrorism connected to the Mediterranean’s migration flow,” commented Misbah. 

Both Elghuel and Misbah stressed that a federal system might be the solution to stabilize the country again and reset everything. This would avoid the current centralized power and create the basis of a new modern state. 

For Grada, the international actors’ influence may be decisive in understanding whether a solution to the current situation is reachable or whether a war will break out instead. 

“International powers are currently busy with the situation going on in Gaza, in Ukraine, in Sudan, so the Libya issue is currently not on the table. So far, both armed militias and local politicians seemed not to want a war, but if the current situation will go further and no international actor will intervene, a war may occur,” Grada concluded.

***

Giorgia Valente is a recent graduate of Ca’ Foscari University of Venice and an intern in The Media Line’s Press and Policy Student Program.

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Simon Watkins

• Libya’s oil production has been repeatedly disrupted due to ongoing conflicts between various factions since the removal of Muammar Gaddafi in 2011.
• The latest shutdown has reduced Libya’s oil output by over 60%, echoing a similar blockade in 2020, which lasted for eight months and resulted in massive revenue losses.
• The current shutdown stems from efforts to remove the present Governor of the Central Bank of Libya, Sadiq al-Kabir.

Every episode of the late-1970s/early-1980s cult spoof TV soap-opera series, ‘Soap’, began with the recounting of a bizarre series of events followed by the phrase, ‘Confused? You won’t be after this week’s episode’. The events behind every single oil shutdown in Libya that has occurred since the removal of long-time leader Muammar Gaddafi in 2011 make the introductions to ‘Soap’ seem as clear as crystal. The reasons that prompted the latest closures of the country’s oil fields are no different and, given their eye-watering complexity, it may be a long time since the current standoff between the main actors involved is resolved.

It is apposite to note at this point that before Gaddafi was removed as leader, Libya had easily been able to produce around 1.65 million barrels per day (bpd) of mostly high-quality light, sweet crude oil. Production had also been on a rising production trend at that point, up from about 1.4 million bpd in 2000.

Although this output level was well below the peak levels of more than 3 million bpd achieved in the late 1960s, its National Oil Corporation (NOC) had plans in place before 2011 to roll out enhanced oil recovery (EOR) techniques to increase crude oil production at maturing oil fields. There had also been plenty of interest from a slew of international oil companies (IOCs) to be involved in expanding production on existing fields and exploring new opportunities in oil and gas. After all, Libya still has 48 billion barrels of proved crude oil reserves – the largest in Africa.

Following Gaddafi’s forced exit from the top job, the power vacuum created sucked in multiple factions warring for the largest share of this huge oil wealth. By 2020, two broad power blocs had emerged – one being the rebel Libyan National Army (LNA) commanded by General Khalifa Haftar, and the other being elements of the then-United Nations (U.N.)-recognised Government of National Accord (GNA).

A near-total blockade of Libya’s oil producing fields had run from 18 January to 18 September of that year (conservatively estimated to have cost the country US$9.8 billion in lost oil revenues) before an agreement was reached between the two sides to end the dispute. Crucially, though, Haftar made it very clear that this agreement would be contingent on certain measures being undertaken that would more fairly distribute the revenues from oil sales between the principal warring factions.

Very shortly after this demand by Haftar, then-GNA Deputy Prime Minister Ahmed Maiteeq said that an in-principle agreement had been made to establish a commission to determine by the end of 2020 how those oil revenues would be dispersed.

To address the fact that the GNA effectively held sway over the NOC and, by extension, the Central Bank of Libya (in which the revenues are physically held), the commission was also tasked to “prepare a unified budget that meets the needs of each party… and the reconciliation of any dispute over budget allocations… and will require the Central Bank [in Tripoli] to cover the monthly or quarterly payments approved in the budget without any delay, and as soon as the joint technical committee requests the transfer.”

According to a Washington-based legal source who works closely with the Presidential Administration on energy matters spoken to by OilPrice.com at the time, the NOC had been working on “alternative banking arrangements for the oil revenues that may or may not involve the input on final dispersal of more players [than Haftar and his LNA, and the U.N.-recognised elements of the GNA].”

However, the details of this were never worked through and no replacement ideas have been forthcoming since then. Consequently, Libya has been subject to repeated shutdowns of some or all of its oil fields, for various spurious reasons that simply disguise attempted asset-grabs by various of the warring factions involved. In the run-up to the current big shutdown, for example, a smaller one began in the first half of August seemingly caused by the arrest of Saddam Haftar, the son of General Haftar.

The younger Haftar had been briefly detained at Naples airport after his name appeared on a European Union database over an arrest warrant issued in Spain for alleged weapons smuggling. This followed comments from former U.N. special envoy to Libya, Abdoulaye Bathily, that the country was becoming a mafia state dominated by gangs involved in smuggling operations, especially for arms. Indeed, last September, General Haftar travelled to Moscow for talks with Russian President Vladimir Putin, whose Wagner mercenary soldiers provide support for LNA forces in Libya. Early July also saw Italian authorities seize two Chinese-made military drones that were destined for Libya and disguised as wind turbine equipment.

One month on, the current shutdown stems from efforts to remove the present Governor of the Central Bank of Libya, Sadiq al-Kabir. General Haftar and his LNA forces in the east of the country (where most of Libya’s big oil fields are located) oppose al-Kabir’s removal. Prime Minister Abdul Hamid Dbeibah and his internationally-recognised Government of National Unity (GNU), based in the capital Tripoli in western Libya, want al-Kabir gone.

As of a televised broadcast on 26 August, the separate Government of National Stability (GNS) – based in Benghazi in the east, and dominated by General Haftar’s followers – said that a ‘force majeure’ would apply on all oil fields, terminals and facilities in the oil crescent, south and southeast, effectively halting the country’s oil production.

The following day, several key Libyan oil fields were offline, including the 70,000 bpd El-Feel field. Meanwhile, the Sirte and Waha oil companies both said in statements that they were gradually reducing their joint output of around 200,000 bpd of oil. As of the end of last week, Libya’s crude oil production was down over 60 percent from the 1.15 million bpd average it had pumped in July. The last time such a shutdown was as rigorously applied by the same forces as are applying it now was the 2020 closure, and that lasted for eight months.

***

Simon Watkins is a financial journalist, and best-selling author. He was Head of Forex Institutional Sales and Trading for Credit Lyonnais, and later Director of Forex at Bank of Montreal. He was then Head of Weekly Publications and Chief Writer for Business Monitor International, Head of Fuel Oil Products for Platts, and Global Managing Editor of Research for Renaissance Capital in Moscow.

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Tarek Megerisi

The North African country appears trapped in an endless cycle of dysfunction and malfeasance with no way out but a total reset.

Libya’s latest political standoff, this time over who should head the country’s central bank, has once again highlighted the chronic dysfunction that has plagued the country since the 2011 overthrow of Moammar Gaddafi. Libya’s political economy, militarized and bedeviled by foreign interference, is broken: unsuitable even for Libya’s rival leaders, incapable of constraining them, and perennially unable—by design—to meet the needs of ordinary Libyans. 

The failure of the system becomes evident through its repeated breakdowns: closures of oil fields, military flare-ups, announcements that politicians no longer recognize one another. Often read as standalone events, these are in fact natural features of a system made up of a series of overlapping political agreements and quasi-constitutional documents built to manage Libya and divide control over its wealth.  

Yet the international community stubbornly attempts to restart the same system every time it fails, desperate to avoid the cost of building something new like an impatient technician stabbing at a computer’s restart button, trying to squeeze a bit more use out of an obviously broken machine. This is why Libya’s failure is periodic, and its breaking points, each of which reveals a deeper problem, now familiar.  

The latest stand-off began on August 5, when Saddam Haftar, the notoriously hot-headed son of eastern Libya’s dictator Khalifa Haftar, shut down Libya’s largest operational oil field. That move was intended to punish Europe, after Saddam, who is a senior commander in his father’s self-styled Libyan Arab Armed Forces (LAAF), was detained in Napoli as part of a Spanish investigation into weapons smuggling. The field he shut down is co-operated by an all-European line-up: France’s TotalEnergies, Austria’s OMV, Norway’s Equinor, and Spain’s Repsol.  

This move demonstrated the younger Haftar’s determination to guard his longstanding impunity, especially given his reported ambitions to succeed his father. It also showcased a deepening trend among the Haftar family to use Libya’s resources and infrastructure as their personal property. This wasn’t the first time they had shut down Libyan oil exports for political goals, but they had never done so for something so petty. It was telling that Saddam tried to blame the closure on local protestors, showing he is mindful of optics, given the blockade would cause local power shortages and worsen pre-existing fuel shortages.  

Shortly afterwards, Saddam — who, like his father, desires to take control of the capital Tripoli—sent a large force westwards in a likely bid to seize the last oil-producing territory in Libya still beyond his control, the Ghadames basin. He also hoped to take over key border crossings with Algeria and Tunisia, and ideally a chunk of territory west of the capital. The plan was to create an overnight fait accompli, utilizing a local ally who would secretly convince the region’s constellation of armed groups to join Haftar’s forces, allowing Saddam to simply move in a manner that would dissuade his rivals from attacking his new positions. It is a strategy used regularly by his father. 

However, his proxy failed to flip enough local forces, and the grand march west, widely broadcast on social media, put forces aligned to the Tripoli government on high alert. Saddam then shifted his narrative, claiming the operation had always been a mission, coordinated with Algeria, to secure Libya’s borders following recent violence in Mali—notwithstanding the fact that Mali’s closest border lies around 1,000 kilometers (600 miles) from Libya, and that Algeria publicly denounced the LAAF’s movements.  

Force as Legitimacy 

As all this was playing out, the Haftar clan’s rivals, led by Tripoli-based interim Prime Minister Abdul Hamid Dbeibah, were also plotting. Over the course of the year, Dbeibah had been forced to cut his spending drastically following a feud with the governor of the Central Bank of Libya (CBL), Sadiq El-Kabir. This had played in favor of the Haftars, as El-Kabir sent funds their way instead. They were also earning oil revenues by cannibalizing Libya’s National Oil Company through a fuel-for-crude scheme. In response, Dbeibah started looking for ways to oust the CBL governor, leveraging his own control over Libya’s political institutions. 

In a pre-emptive attempt to defang the Dbeibah plan, on August 13 Libya’s parliament—which is controlled by the Haftars and their loyalists—issued a legal ruling aimed at delegitimizing Dbeibah’s government and the accompanying three-seated Presidency Council, which is technically Libya’s head of state. The parliament argued that the mandates of both bodies had expired—with no hint of irony, from a legislature itself elected in 2014 which hasn’t made quorum in years. 

Nevertheless, on August 19, the Presidency Council issued a decree sacking El-Kabir. Again, this was legally incoherent, given that the Presidency Council doesn’t really have that right, and that its decree was based on a 2018 law that has since been rescinded. However, when all state bodies’ mandates have expired and loopholes are all that remain of political agreements, force becomes the only source of legitimacy.  

El-Kabir hunkered down in the bank, knowing that if he left, militias wouldn’t let him return. Dbeibah, meanwhile, twisted the screws and replaced the head of the national body purchasing the fuel that Haftar so lucratively smuggles.  

But Dbeibah’s ill-executed gambit failed. While El-Kabir will probably still be replaced, this will now be an agonizing negotiation rather than a fait accompli. The political heads and military muscles of Libya’s broken system are setting up a new board for the CBL, echoing Libya’s last negotiated settlement from two years ago to replace the head of Libya’s National Oil Company.  

The divvying-up of the CBL, which was only reunified last year after a decade of division, is likely to be no less damaging for Libya given the vying for credit and funding allocations that will accompany the bartering for board positions. It also risks the long-term effects of Libya being quarantined from international financial systems.       

Cycles of Collapse 

Throughout the latest crisis, the architects of the system made do with offering appeals for calm and pleas to return to the status quo, rather than the hard-nosed mediation that might move Libya towards a real solution. Ultimately, like everyone else, they will gather wherever new facts on the ground are created to smooth the edges into something more amenable and less threatening. 

Whether negotiations over a new CBL board can stop a violent breakdown and be enough for a soft reboot of Libya’s system has yet to be seen. What is certain is that either outcome will be destructive. Unless Libya’s system is replaced, it will eventually end in yet another civil war. Meanwhile, given enough time, it will hollow out and bankrupt the once wealthy state of Libya.   

Clearly the system is broken. When it runs smoothly, greedy politicians and gangsters prey on the state and its treasury, foregoing any actual governance. When it breaks down, wars and the divisions they cause preclude any potential reconciliation or rebuilding. As the same system is simply restarted, there is no mechanism for accountability, and no opportunity to turn structures that incentivize competition and corruption into ones that engender cooperation, compromise and good governance. 

The deleterious effects of this continuously cycling system is evident in last year’s catastrophe in Derna, where years of neglect caused a dam to cataclysmically burst, killing thousands and displacing many more. It is also on show in the way the shadow economy has overcome the regular economy, turning what was once a quiet economy of oil, civil servants and educated professionals into a smugglers’ paradise. 

So, as Libya swings once again into the news and up the list of diplomatic priorities, two questions remain. Is the system about to collapse once more? And how many more cycles can Libya survive? 

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Wolfram Lacher

It’s Not about Deniability

This self-isolation from Libyan society is not – or at least no longer – about deniability. Turkey has never made a secret about its troop deployment. Russia did (implausibly) deny that it had forces in Libya for a long time. But since the rebellion and death of the founder of Wagner, Yevgeny Prigozhin, Russia has slowly moved towards acknowledging its presence as the Russian defence ministry takes over Wagner’s previous role.

The Russian ambassador in Tripoli has publicly stated in several interviews in 2024 that Russian “elements”, rather than forces, are cooperating with Haftar’s forces in eastern Libya. The much noted delivery of weapons by Russian vessels via the port of Tobruk in April 2024, and the visit to Tobruk by several Russian warships in June, both reinforced the message that the Russian presence was becoming more overt and official.

Instead, the modus operandi of Turkey and Russia in Libya offers clues to the purpose of their presence. In Mali and the Central African Republic, Wagner pursued objectives that required far greater interaction with the population: It conducted brutal counterinsurgency campaigns that resulted in many civilian victims, but also business ventures and public relations campaigns that heroized Russians as champions of national sovereignty against French neocolonialism.

In Libya, by contrast, the Turkish and Russian presence has involved very few armed interventions against local actors since the end of the Tripoli war. Nor have they used their deployments to take control of resource extraction – although the presence itself offers opportunities for profit, such as through the exploitation of Syrian fighters.

Rather, the point of having a presence in Libya seems to be to keep it. For Turkey, a Libyan commander with close ties to Turkish officers argued that the purpose of the Syrians’ presence is to secure Turkey’s foothold. One day, it may be possible to convert that military muscle into political influence and economic profit in ways that have broadly been elusive for both states thus far.

For Russia, the presence also serves as a hub for deployments in sub-Saharan Africa, and potentially for maritime power projection in the Mediterranean. To serve those goals, keeping a low profile appears to be the right approach.

… And It’s Working

In cases where interactions between foreign troops and local populations are expected to provoke conflicts, they are often curtailed to the extent possible. This logic also appears to inform the Russian and Turkish postures in Libya, where two factors make deployments particularly prone to controversies: First, Libyan public opinion is particularly averse to foreign troops; second, the legitimacy of Libyan government institutions is at best dubious, meaning Russia and Turkey both lack solid relationships on which to found their presence.

By and large, it appears this posture is working as intended. The foreign military presence is now rarely the subject of controversy, and the public appears to have gotten used to it. There have been two major exceptions to that rule: drone strikes that thwarted an attempt by a political-military alliance in August 2022 to install a new government in Tripoli, and another campaign of drone strikes in May 2023 that targeted opponents of the incumbent Prime Minister in Tripoli, under the guise of fighting smugglers.

In both cases, those at the receiving end of the strikes publicly accused Turkey of involvement. Public and private denials by Turkish diplomats and military officers did little to convince Libyans. A senior politician who had welcomed the Turkish intervention against Haftar told me after the August 2022 strikes that he could not accept a foreign state deciding who ruled in Tripoli.

But such controversies have rapidly blown over, while the general absence of incidents has kept the issue of this foreign presence out of everyday political debates. One resident of the Jufra region even went as far as to claim that people were “happy about the Russians, because they keep to themselves, they mind their own business” and did not do anything that would destabilize the local situation. Of course, that view may not be representative, and it brushes over the fact that the fear of repression by Haftar’s forces effectively rules out any expressions of opposition to the Russian presence.

Adopting a low profile doubtlessly also helps Russia and Turkey, as they are reaching out to their former Libyan opponents. Turkish companies now operate in Haftar-controlled eastern Libya, having scooped up contracts in the reconstruction bonanza controlled by Haftar’s sons.

The Russian embassy returned to Tripoli in mid-2023, led by a new ambassador who is fluent in Arabic and has gone on a charm offensive. More broadly, the polarization among the foreign backers of Libya’s rival forces has long given way to ambiguity:

The Tripoli-based government has relentlessly courted two other key foreign powers in Libya – Egypt and the United Arab Emirates – that have traditionally supported Haftar. For Libyan actors, multipolarity implies juggling competing foreign interests rather than choosing between them.

In other contexts, the secrecy surrounding the foreign bases and the self-isolation of troops from their social environs have at times backfired by encouraging the spread of rumours about allegedly hidden motives and malign activities by foreign forces. This, for example, applied to the French and US presence in the Sahel states, before the leaders of military coups forced them to leave.

Interestingly, the Russian and Turkish presence in Libya tends to be much less of an object of speculation than the activities of Western states – in particular those of the US, the United Kingdom (UK), and France, despite the fact that all three have a far more limited military presence in Libya than Russia and Turkey.

Over the past two years, the US, the UK, and Italy have each made separate efforts to build relationships with selected western Libyan commanders by training small numbers of their troops. These modest undertakings have fuelled recurrent – but, to the best of my knowledge, wholly unfounded – rumours that Western states are training and equipping a Libyan force with the objective of attacking the Russians. Ironically, then, even Libya’s rumour mill sees aloof Western powers as a more likely source of instability than the Turkish and Russian military presence.

***

Dr Wolfram Lacher is a Project Director of Megatrends Afrika and a Senior Associate in the Africa and Middle East Division at SWP.

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Hafed Al-Ghwell

Libya remains embroiled in a state of political fragility, which is being exacerbated by a new “war” among its litany of belligerents that now seek to undermine key institutions, particularly the central bank and the National Oil Corporation. This new warfare, characterized by insidious maneuvering as an alternative to disastrous kinetic warfare, has emerged as rival factions struggle over control of the nation’s vital oil resources and revenues, as well as influence over the institutions that control them.

This struggle signifies more than just a bureaucratic tug of war; it marks the latest phase in a decade-long endeavor by Libya’s nonstate armed factions to solidify state capture by drawing the essential pillars of the country’s economy into their competing spheres of influence. Thus, control over the central bank and oil company — the equally troubled state-owned enterprise that dominates Libya’s oil and gas sector — is now a battlefield where political elites vie for dominance, threatening an already fragile relative peace.

The central bank has long been one of the few institutions to unite Libya’s east and west. However, recent moves to oust the bank’s governor, Sadiq Al-Kabir, reflect deeper political machinations. The UN-recognized government in western Libya, led by Prime Minister Abdul Hamid Dbeibeh, and the eastern parliament under Khalifa Haftar both see the bank’s leadership as crucial to their power.

Analysts predict that ousting Al-Kabir could sever Libya’s access to international markets, further crippling its economy. Such a scenario would have dire ripple effects, paralyzing government salaries and essential services that millions of Libyans depend on. Additionally, manipulating the bank’s resources would also allow either faction to keep funneling public funds into sprawling kleptocratic networks, unchecked by a war-weary public and an exasperated international community not keen on a return to open conflict.

Rather, the preferred status quo is the current political climate — an unsteady peace between two equally matched foes that recognize the futility of leveraging violence to achieve their objectives. However, Libya’s quarrelsome ruling elites have yet to forgo their ambitions to usurp their rivals by any means possible.

Recently, this has manifested itself in covert strategies aimed at delegitimizing and destabilizing the institutions that manage the country’s primary export — oil. Last week’s blockade of Libya’s largest oil field by Haftar and subsequent militia deployments around the central bank’s Tripoli headquarters are eerie reminders of familiar strategies prior to the October 2020 UN-brokered ceasefire, with disruptions at key locations and threats of violence leveraged to drive bargains where discourse fails.

Although self-defeating, such escalations remain relatively effective, illustrating how crucially intertwined oil revenues and financial control are when it comes to Libya’s power dynamics. As the mudslinging escalates in Libya’s east-west divide, the country’s ruling elites double down on sidelining legal norms for political expediency, ultimately diminishing the linchpin role of key institutions in fostering unity between east and west.

While Libya has avoided large-scale conflict since the October 2020 ceasefire, reduced prospects for national elections have, on the other hand, left power in the hands of the inherently corrupt and deeply compromised. Foreign fighters and entrenched militias continue to erode Libya’s infrastructure and economic prospects, while the struggle for control over key institutions foreshadows an intensifying structural destabilization. The ensuing power vacuum is already responsible for the current environment of relentless greed as elites prioritize self-preservation over restoration and national stability.

The result is an increased intensity of episodic troubles of the constant power struggles, militia deployments outside key institutions and, more recently, the kidnapping of the central bank’s IT director, which has even prompted dire warnings from abroad. For instance, the US special envoy to Libya has called threats to the central bank’s staff and operations unacceptable in a rare show of international concern over events in Libya beyond impromptu reactions to the UN envoy’s periodic updates to the Security Council.

Of particular concern is the escalating power of nonstate actors over the national treasury and the oil sector, which threatens the nation’s fragile economic structure. This shift toward decentralized control worsens existing divisions and fuels rampant corruption, which has become endemic. Despite numerous interventions and diplomatic efforts, international actors have consistently failed to bridge Libya’s internal rifts or deter its entrenched factions from pursuing state capture.

Libya’s oil sector, already hobbled by corruption, also finds itself enmeshed in a web of regional exploitation, complicating efforts to establish transparency and accountability in this vital sector, which is responsible for more than 90 percent of Libya’s gross domestic product.

This convergence of domestic and international interests, manifesting through illicit activities and economic plundering, are glaring examples of Libya’s debilitating kleptocracy, as domestic grievances and global complicity deepen the country’s crises. It is very unlikely the global community will be as engaged, adequately equipped and highly motivated to address the current standoff beyond finger-wagging and penned rebukes.

However, as the quiet war on Libya’s institutions enters a new phase, self-interested middle powers are as emboldened as ever to preserve the quagmire as a means of asserting their own extraterritorial designs. This meddling is further exacerbated by the stunning ineptitude of more influential actors like the US and the EU, which consistently fail to find and speak with one voice concerning Libya’s milieu.

Meanwhile, there is growing momentum at the UN Security Council to unfreeze Libya’s assets, which could potentially flood the country with billions of dollars, empowering its sprawling kleptocracy and further entrenching the ruling elite. The ramifications of this influx of cash for Libya’s immediate neighborhood would be significant. Unchecked financial resources would likely sponsor spoilers, prompting renewed conflict, humanitarian catastrophes and mass migration.

Unfortunately, credible political and economic reforms will always remain elusive when power rests in the hands of individuals with little incentive to change. The failure to hold national elections has crippled Libyan governance almost permanently.

The UN-brokered deal that installed Dbeibeh and created the Presidential Council was meant to unify the country, but political authority remains fragmented, combative and ineffective. The anticipated elections that never took place have since left Libya’s institutions, particularly the central bank, caught in the crossfire.

As political elites and militia factions conspire to undermine each other, Libya’s ability to effectively manage oil and its ensuing revenues will remain compromised. The failure to foster a robust environment to establish a stable and unified government is now not only jeopardizing Libya’s future, it is threatening to destabilize the region, which could spark difficult conversations on mounting a daunting, yet essential, forceful intervention to restore Libya.

***

Hafed Al-Ghwelli is a senior fellow and executive director of the North Africa Initiative at the Foreign Policy Institute of the Johns Hopkins University School of Advanced International Studies in Washington.

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Jonathan M. Winer

The ongoing effort by various factions in Libya to gain control of the Central Bank of Libya (CBL) poses a clear and present danger for the entire country, threatening its safety and security as well as its economy.

Already, the crisis over the control of the CBL has resulted in the closure of 60% of Libya’s oil production, whose revenues are supposed to flow through the bank, with some 700,000 barrels a day of production halted and further shutdowns imminent, leading to an immediate spike of 7% in global oil prices.

If the conflict is not resolved, millions of Libyans who rely on the CBL to ensure the payment of their salaries and the letters of credit essential to providing them billions of dollars a year in imported fuel, cooking oil, and food will face immediate shortages, as already reflected in reports of seven-mile-long lines at some Libyan gas stations. Indeed, the United Nations Support Mission in Libya (UNSMIL) is warning that the situation “risks precipitating the country’s financial and economic collapse.”

The CBL’s central role in Libyan life

Throughout the chaotic period and dysfunctional politics that have characterized Libya since the 2011 uprising against Moammar Gadhafi, the CBL has been one of two institutions central to maintaining the country’s economy, the other being Libya’s National Oil Corporation (NOC). The NOC provides some 97% of Libya’s export earnings, through pumping roughly 1.2 million barrels a day of oil to generate $20 billion-25 billion in recent years, despite recurrent politically driven production shutdowns.

Under Libyan law, these revenues are supposed to be deposited into the CBL for distribution under government-approved budgets in four major categories: salaries, grants, operating expenses, and development projects. Salaries for government employees, including members of Libya’s array of military forces, have been the biggest item in the budget for years, constituting about two-thirds of the CBL’s total transfers.

Thus, for Libya, oil revenues remain the lifeblood of the economy, with the CBL acting as the heart that keeps this lifeblood flowing. To follow the metaphor, attacks on the CBL, and its ability to keep the money flowing, are for Libya’s economy the equivalent of heart attacks — dangerous and potentially crippling or worse.

The CBL and its governor, Sadiq al-Kabir, have faced their share of troubles over the 12 years he has remained in place. During that time, he has survived divided governments, the breaking away of the bank’s Benghazi offices to create a parallel institution for funding eastern political and military groups, and recurrent efforts by various Libyan factions to replace him with people who could be more easily controlled.

But throughout these stresses, Kabir managed to preserve the CBL’s quasi-independence from Libyan politics, and he kept Libya’s sovereign wealth safe from some of the efforts to raid its budget, even as critics spoke darkly of corruption — especially alleged abuses of letters of credit by favored importers and government contractors.

Dueling charges of corruption and abuse

Kabir’s independence has played a primary role in the current effort to remove him. In February, the CBL governor made public his differences with Libyan Prime Minister Abdul Hamid Dbeibeh over spending. In a letter, he criticized Dbeibeh for promising salary increases and other public spending that would exceed the country’s income; moreover, he pointed to the continued loss of value of the Libyan dinar against other currencies. In response, Dbeibeh accused Kabir of dishonesty and corruption, opening the door for the further politicization of the CBL and leading to the current fight for control.

The smell of blood in the water attracted additional Libyan sharks. These included Libya’s Presidential Council (PC), operating in concert with the Dbeibeh government; the Tobruk-based House of Representatives; the Tripoli-based High State Council; the Benghazi-based Libyan warlord Khalifa Hifter and his sons; as well as Tripoli militias and ministries with the power to determine which would be in physical possession of the CBL’s offices. At various times, each of these groups have played politics over the CBL, either to grab more of its resources or to prevent them from going to anyone else.

Warring governmental bodies and

increasing violence

Efforts to take over the bank from Kabir came to a boil this month. In mid-August, armed men tried to take over the CBL’s Tripoli offices. On Aug. 16, an unidentified group entered the home of a key CBL official who possessed the passwords needed to access its payment systems and kidnapped him.

In response, Kabir shut down the CBL on Aug. 17, which secured the official’s release the following day. In response, the head of Libya’s PC, Mohammed Menfi, appointed a new board to the CBL and announced that Kabir had been fired and replaced. This decision was swiftly followed by physical raids on the CBL offices by unidentified armed men and then placed under the control of the Ministry of Interior, whose head was appointed by Dbeibeh.

The effort to grab control of the central bank by Menfi and the PC and their unilateral effort to appoint an entirely new CBL board of directors was promptly rejected by the two parts of Libya’s legislative branch, the House of Representatives and its High State Council. Their leaders stated that they alone had the right to appoint a new head of the CBL.

As the fight over the CBL intensified, forces in Libya’s oil crescent, supported by the president of Libya’s internationally unrecognized eastern government, closed oilfields, essentially shutting down Libyan petroleum production. Simultaneously, the CBL itself reportedly curtailed its operations, preventing some Libyan banks from conducting routine banking activities. According to one report, Western Union consequently suspended its international payment operations in Libya.

Amid additional kidnappings of CBL staff, Kabir reportedly left Libya for Turkey, taking with him critical personnel who hold the keys to the central bank’s operations, thereby getting them out of harm’s way. Meanwhile, a new acting governor, Abdul Fattah Ghafaar, who had just been appointed to be a deputy governor, announced that he was now in charge of the bank.

In response, Kabir referred to his successor as an illegitimate “usurper,” declared his decisions to be “void,” and ordered CBL personnel to leave their offices and not come back until the “criminal” takeover was rectified. Notably, the person who was appointed to be the governor by Menfi and the PC to replace Kabir, Muhammed al-Shukri, announced that he would not accept the position so long as there were disputes about who had the right to appoint him to the job, saying that preventing bloodshed was worth more to him than any government position.

The current impasse

As of late August, Kabir continues to control access to the CBL’s information and payment systems, but he can no longer enter the CBL without the risk of being immediately arrested. The new acting Central Bank head and the new CBL board have no control over the bank’s systems — only its physical offices — nor, it appears, even much of its staff.

The situation threatens domestic as well as international payments. Given Libya’s dependence on imports for basic daily needs such as food, as well as the payment of people’s salaries, this risks a rapid descent of an entire country into a maelstrom of instability and potential collapse.

With rumors swirling that various militia groups are preparing to engage to retake the Central Bank offices by force, the UNSMIL called for an emergency meeting of all involved parties to reach a consensus on a solution. Moreover, it demanded the suspension of all “unilateral actions” relating to the CBL, the reopening of oilfields, a halt to military escalation and the use of force regarding the CBL, and guarantees of the safety of CBL employees to protect them from arbitrary arrest. The statement was immediately backed by the United States Embassy in Libya.

Finding a path forward

All of Libya’s political institutions are at this point jerry-rigged. Neither of the two internationally recognized interim governments based in Tripoli that came into existence, since 2015, through flawed UN-brokered processes have ever had unitary control of Libya’s territory. Control in the eastern coastal region, and much of the south, has been exerted instead by Hifter and his sons, with military and political backing from Russia, Egypt, the United Arab Emirates, Jordan, and, from time to time, France.

The various eastern governments, not recognized internationally, have also had the economic backing of Russia in the form of billions of counterfeit dinars. While Kabir is being blamed for higher prices and a decreased value of the dinar, an obvious factor in helping to devalue the dinar and reduce its purchasing power for ordinary Libyans has been the introduction and use of these currency notes over an eight-year period by the Hifter-controlled parallel Central Bank in Benghazi, without disclosure or controls. In recent months, domestic counterfeiting — allegedly undertaken by members of the Hifter family — has further undermined Libya’s currency.

Kabir still has a few cards to play. In addition to physically holding the keys to the kingdom and the recognition of his role by other governments (including the United States) and other central banks, he retains apparent protection by the Turkish government generally and by Turkish President Recep Tayyip Erdoğan in particular.

Keeping Kabir in place has been in Turkey’s economic as well as political interests, as reflected in unconfirmed allegations that the CBL has been holding billions in gold in Turkey’s Central Bank and has placed substantial deposits there. It is difficult to imagine Turkey readily giving up that kind of relationship.

The situation is fluid, and there is a real threat that the economic crisis will evolve into a worsening political and security crisis. But one can imagine solutions that take the country beyond the use of local military forces to grab valuable governmental institutions as the spoils of war.

Some might involve Kabir making power-sharing concessions to his political enemies, dividing the authority of the Central Bank governor in some way that brings aboard currently competing factions and assuring each side that the other does not get more than its “fair share.”

For instance, Kabir and Shukri might share authority on a transitional basis, pending national elections, under a new temporary CBL board of directors whose members represent a wide range of Libyan political constituencies, with the total governance structure designed to checkmate anyone undertaking a power grab.

Resolving the crisis is clearly in the interest of most international actors active in Libya. On Aug. 29, the UN Security Council issued a statement reiterating UNSMIL’s call to Libyans to reach “a consensus-based solution to the current crisis regarding the Central Bank.”

Notably, about 85% of Libyan oil exports go to Europe, including Italy, Germany, France, and Spain, making resolution of the crisis strongly in their immediate economic interests as well. Russia, which has from time-to-time secured its own separate off-the-books deals for Libyan oil, also has strong interests in maintaining relations with the Hifter family, which for now is on Kabir’s side and opposed to what is seen as a grab by Dbeibeh and his allies.

Eventual compromise is familiar in post-Gadhafi Libya, as reflected in the CBL’s reunification with its Benghazi branch in August of last year, after a decade of division. Behind that agreement was a reported arrangement according to which Kabir agreed to bail out banks in Libya’s east that had previously been pillaged by Hifter and his associates, essentially recapitalizing the eastern part of the country and enabling its banks to lend once again for commercial development — including to businesses controlled by Hifter’s family members.

In Libya, sharing the wealth can patch over even the most serious differences among well-positioned and properly motivated stakeholders, especially to stave off even more difficult things, like elections.

***

Jonathan M. Winer, a Non-Resident Scholar at the Middle East Institute, was the US Special Envoy and Special Coordinator for Libya from 2014 to 2016 as well as the Deputy Assistant Secretary of State for International Law Enforcement.

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Sean Mathews

Foreign powers backing Libya’s rival governments don’t want a return to war, but situation could spiral out of control, experts say.

Libya’s oil production and exports plunged Thursday as warring political factions appear to be digging in for a feud over control of the war-ravaged country’s central bank and the petrodollars it holds. 

The closure of oil fields and terminals across eastern Libya slashed the Opec member’s production by roughly 700,000 barrels per day, analysts told Middle East Eye.

Libya, home to Africa’s largest proven oil reserves, was producing about 1.2 million bpd this year. Brent crude was trading up 1.3 percent on Thursday.

Analysts at energy firm Kpler said the shutdowns are rippling across markets. “Key Mediterranean players are watching the Libyan escalation with great concern,” according to a market report shared with Middle East Eye. 

“Libya is poised to become the most significant wild card in the oil markets of 2025,” the report added. 

The closures are a result of a dispute between Libya’s rival governments for the reins of the central bank in Tripoli, which controls the cash generated by the country’s oil sales.

On one side is Abdul Hamid Dbeibeh, the prime minister of Libya’s UN-recognised government based in Tripoli, who wields an alliance of powerful militias. On the other side, is Field Marshal Khalifa Haftar, who controls a rival government based in the country’s east. 

While Libya’s central bank is located in Tripoli, the bulk of its oil reserves and infrastructure are located in the east.

The two governments fought a bloody civil war after Haftar’s army tried to take Tripoli, but over the last two years, they reached an uneasy stalemate, based on their mutual interest in dividing up Libya’s energy resources among themselves. 

“The central bank was the key cornerstone of this relative stability, which is based on an informal revenue sharing deal between Dbeibeh and Haftar,” Riccardo Fabiani, director of the North Africa Project at the International Crisis Group, told Middle East Eye.

Fight over Libya’s central bank

The crisis started in August when the central bank was besieged by armed militants who reportedly tried to force the bank’s long-time governor, Sadiq al-Kabir, to resign. Then, the bank’s head of information technology was kidnapped. He was released, but the move prompted the bank to suspend operations, jolting the local economy.

On 18 August, Libya’s presidential council, which is aligned with Dbeibeh, unilaterally announced it was firing Kabir. In response, Libya’s eastern government said it was suspending all oil production and exports, declaring that “outlaw groups” had tried to seize “Libya’s most important financial institution”. 

The rift started because Dbeibeh appeared frustrated with Kabir who has run the bank since 2011 and was previously viewed as a Dbeibeh ally, analysts say. But Dbeibeh resented the level of cash that has been flowing to Haftar. He believed he was getting the short end of the informal revenue-sharing deal. 

“The system was working more in a way that seemed to favour Haftar. A lot of money has been flowing into construction projects in the east. There is money left and right from smuggling there, but less in Tripoli,” Fabiani said.

‘Hell-bent on power’

Dbeibeh came to office in a 2021 power-sharing deal brokered by the UN. His government was supposed to be temporary, with the job of steering Libya to elections, and an eventual deal to unify the country’s east and west, but those elections have yet to materialise.

Analysts say the central bank dispute reveals that Tripoli’s government has no intention of stepping down. With no deadline for elections or term limits, they say leaders in Tripoli have been cementing control of other institutions like the National Oil Company (NOC). 

“The Dbeibeh family is hell-bent on staying in power. As a family, they want to be on the same level as the Haftars,” Jalal Harchaoui, a Libya expert at the Royal Service Institute, told Middle East Eye.

Libya splintered into warring factions after the overthrow and death of Muammar Gaddafi in 2011. Fighting in the strategic, energy-rich country soon descended into a proxy war with foreign powers backing opposing sides. Haftar, a former Qaddafi general and CIA asset, made a failed bid to capture Tripoli.

Libya’s conflict sucked in external powers, with Turkey backing the government in Tripoli and Egypt, and the UAE and Russia supporting Haftar.

Today, Turkey- and Russia-linked mercenaries are deployed in Libya, but foreign powers have diversified their relationships across the east and west since 2021, experts say.

US shuttle diplomacy

Libya’s instability has been overshadowed by Israel’s war in Gaza and tensions with Iran, but the latest showdown has unnerved foreign powers, who experts say don’t want to see a return to war.

On Tuesday, the US top commander in Africa, General Michael Langley, met with Haftar and visited Dbeibeh in Tripoli on Thursday. Analysts say the shuttle diplomacy is a bid to decrease tensions.

“Very influential states, like the US, are very afraid of a physical war in Tripoli,” Harchaoui said. But he added that the local actors may see that fear as an opportunity to stake out even harder-line positions, Harchaoui said.

“If you look unreasonable, you can scare this lame-duck (Biden) administration,” Harchaoui added. 

Fabiani said Haftar and Dbeibah would need financial and military support from regional states that have no interest in another war erupting.

“There is no sufficient external backing for a wider war. Turkey, Egypt and the UAE don’t think they can win one. The serious risk is that one erupts by accident,” Fabiani said. 

However, Russia’s top Middle East official held a phone call on Wednesday with Haftar’s top diplomat and vowed to strengthen security ties. Russian mercenaries support Haftar.  

Another risk, Fabiani said, could be if the tensions prevent government salaries from being paid or spark a battle between militias that spiral out of control. Libya’s oil revenues recently accounted for half of the country’s GDP. 

“Things aren’t escalating so much as they are crumbling.”

***

Sean Mathews is a journalist for Middle East Eye writing about business, security and politics. His coverage spans from across the Middle East, North Africa and the Balkans.

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Wolfram Lacher

Western governments have castigated Russia and Turkey for destabilizing Libya with their military deployments. But in daily life, their military presence is hardly noticeable – even in the immediate vicinity of their bases.

Both states have adopted a low profile in order to stay in Libya for the long term – and so far, their approach appears to be working.

On successive visits to Tripoli over the past two years, I repeatedly drove to a military base on the capital’s western outskirts for meetings. The base is located in a dead end that is set back a few hundred metres from the coastal road. To reach it, I would first pass by another compound just next to it, called Sidi Bilal – one of several bases hosting Syrian fighters whom Turkey has been deploying to western Libya since 2020.

On my first visits, the Turkish flag fluttering at the top of a mast inside the base was clearly visible from outside the base’s walls. Syrian fighters would keep a wary eye on me as I drove past. But on my last two visits, in late 2023 and mid-2024, the flag had been lowered so that it was no longer visible from beyond the walls. I could only catch a glimpse of a Syrian guard’s face peering out from a narrow gap in the gate. It was obvious that measures had been taken to make the Syrians’ presence as discreet as possible.

These changes reflect a broader pattern of how both Turkey and Russia have adapted their military deployments in Libya to the local political context while settling in for the long term. After initial episodes illustrated the explosive potential of troops having contact with local society, both states and their proxies have made their presence increasingly invisible and progressively reduced their interactions in the environments surrounding their bases. For now, this strategy appears to have been by and large successful in gaining a modicum of acceptance for the foreign military presence and thwarting attempts to politicize it.

Settling In

Led by the United States (US), Western states frequently point to the Russians’ presence as destabilizing Libya. Except for France, they rarely portray the Turkish deployment in similarly negative terms. Calls for all foreign forces to withdraw have become a routine talking point of Western states concerning Libya.

In fact, the balance of power created by Russia’s and Turkey’s military presence has been instrumental in freezing the Libyan conflict since the defeat of Khalifa Haftar’s offensive on Tripoli in June 2020. Both states gained their military foothold during that conflict after Western governments adopted a hands-off approach to Haftar’s offensive, with the US and France deciding to give war a chance.

Since the end of that conflict, Haftar has relied on Russia – initially under the guise of the Wagner Group – to deter social unrest and protect him from potential attacks by his opponents based in western Libya. The latter, in turn, have relied on Turkey to prevent another offensive by Haftar.

Both sides have paid their foreign backers for their assistance, allowing them to build a permanent presence in Libya at little cost. Western states, having already proven to Libya’s rival factions that they could not be relied upon, have been short of practical ideas for how to make their recurrent calls for foreign forces to leave a reality.

When both states first began intervening in 2019, their irruption into Libya was a striking illustration of how rapidly the international order was changing – and it heralded new patterns of foreign intervention in African conflicts.

It also startled Libyans and observers of the Libyan conflict. Both Russia and Haftar’s forces denied that they had deployed the Wagner Group – which, at the time, did not officially exist. Visual evidence of Wagner’s presence first came in the form of documents and photos captured by Haftar’s enemies on the battlefield.

Turkey, by contrast, officially announced its intervention, but its deployment of Syrian fighters in December 2019 embarrassed the anti-Haftar forces. Whereas the latter kept quiet about the mercenaries and restricted journalists’ access to them, the Syrians shared videos of their first battles.

When the Turkish intervention finally forced Wagner into a hurried retreat, the Russian’s stealth intervention was briefly caught in the spotlight. Images of Russian fighters being evacuated through the streets of a western Libyan town on uncovered trucks in broad daylight stunned Libyan social media.

Becoming Invisible

When the war ended but the foreign forces remained, early events appeared to underline the explosive potential of the foreign military presence. In Sirte, near the new frontline, Wagner terrorized the population by shelling a residential area to forcibly displace its inhabitants before occupying their houses and mining the surroundings, thereby potentially killing anyone who might approach the area.

In Misrata, Syrian fighters occupied the houses of displaced residents in a southern suburb, fuelling latent tensions with neighbours. When protests erupted in Tripoli in August 2020 amid an economic crisis and defunct public services, those protesting expressed anger that Syrian fighters were being paid in precious US dollars, whereas Libyans barely received their public-sector dinar salaries.

As rivalries among Haftar’s western Libyan adversaries resurfaced, some sought to damage their opponents by falsely accusing them of using Syrian fighters in local conflicts. Pro-Haftar propagandists, meanwhile, tried to stoke fear and anger by spreading fabricated stories of Syrian fighters abducting Libyan women.

The foreign presence seemed all the more likely to provoke a backlash, as contact between foreign forces and the local population was not uncommon, and largely unregulated. In Sirte and Jufra, Russians frequently turned up in shops and restaurants, at times openly carrying weapons.

Sudanese fighters, whom Haftar was no longer able to pay, became an even more vexing presence, as they began demanding tolls at checkpoints along overland roads, and as their ventures into fuel smuggling caused shortages for Libyan consumers. In Tripoli, Syrians also regularly ventured out of their bases on foot to shop for groceries, and in August 2021 they openly protested in front of a base about delayed salaries.

Since then, however, the Turkish, Syrian, and Russian presence has gradually become largely invisible. In Sirte, Wagner fighters withdrew from the areas they had occupied to a dedicated area in the Qardhabiya airbase in 2021.

Their visits to local shops in Sirte and Jufra, often together with their Syrian translators, have become much less frequent. On the rare occasions that they do appear in public, they now invariably wear civilian clothing, signalling that they are on their day off.

In the southern bases of Brak and Tamanhant, where the Russians also have a presence, it is even less common to encounter them outside the bases, local residents say. Interlocutors from the far south occasionally report hearing about Russian visits to remote sites such as gold mining areas or military bases, but they rarely describe seeing them with their own eyes.

Much of the same goes for the Syrian fighters deployed by Turkey. In Suq al-Khamis, south of Tripoli, residents had complained that Syrian fighters would often come out of a local base on foot. But for the past year at least, their sorties were restricted to a single weekly trip by car to local shops, suggesting that a regime regulating interactions with locals had been introduced – thus turning boredom into a major challenge for the Syrians.

The formal Turkish military presence itself has been even less visible, confined to a few military bases between Misrata and the Tunisian border. It is extremely rare to encounter Turkish military personnel outside of these bases.

***

Dr Wolfram Lacher is a Project Director of Megatrends Afrika and a Senior Associate in the Africa and Middle East Division at SWP.

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