Who is to get Moamer Qadhafi's frozen funds?

04 Sep, 2011

The covered market on Rashid Street in the centre of Libyan capital Tripoli has been closed for weeks, although a few traders have set up stalls in the alleyways behind it, selling bread, potatoes, onions, tomatoes, grapes and bananas.
Prices shot up as leader Moamer Qadhafi's rule collapsed, and now the traditional flat bread costs 75 dirhams (equivalent to about 5 cents) and almost twice the usual price. "We've got no choice, if we want to eat," a middle-aged customer says with anger in his voice.
Libya is not short of money. There is reported to be about 150 billion dollars in bank accounts around the world, held in the name of the Qadhafi clan and of the country as a whole. An estimated 15 billion dollars have been released, as French President Nicolas Sarkozy announced at a conference on Libya's future in Paris.
British military aircraft delivered Libyan bank notes worth close to 200 million dollars overnight to the eastern city of Benghazi, where the revolt against Qadhafi started in February. That money was earmarked for the thousands of civil servants who have not been paid for months in Tripoli and other centres that have only recently been freed from Qadhafi's rule.
The new leadership will face other problems: Hospitals lack medicines and equipment, Tripoli's water supplies have been largely cut off, and then there's the high-priority task of disarming the many people who laid hands on guns to rise up against the dictatorship.
Who will receive the money initially? The rebels' Transitional National Council headed by Mustafa Abdel Jalil, with its base in Benghazi, is the body that the international community is dealing with. Few of the council's ministers have yet shown their faces in Tripoli, although expectations are that they will move to the capital soon.
Tripoli saw initial signs of a return to normal administration on Friday, with municipal workers, many of them black migrant workers from countries to the south, cleaning up Martyrs' Square - formerly Green Square - ahead of prayers. Lotfie Amal, a plumber, was putting his household refuse out on the pavement on Omar Muchtar Street. "They're now doing the rounds once a day to take it away," he said.
"The water should be back in the next couple of days," he added hopefully. Whether the expected money will be an unalloyed blessing is open to question. "The funds must be distributed very wisely," says Robert Malley, Middle East director for the International Crisis Group think tank.
"It must be used for immediate improvements, as well as for long-term projects, in such a way that Libyans know what it is being spent on and that they are benefiting from it," Malley said. This is by no means certain, as Qadhafi's state apparatus was not based on transparent institutions, but rather on secretive structures and "people's committees" that have now collapsed. The regime's rapid demise has left a vacuum. Libya will have to invent itself anew from the ground up.

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