Libya: Britain cuts last ties with Gaddafi regime
Push to unfreeze cash assets as William Hague recognises Libyan rebels as government
Britain is to open negotiations at the UN to unfreeze assets running into hundreds of millions of pounds to be funnelled to the Libyan rebel council that was recognised by the UK on Wednesday as the "sole governmental authority" in the country.
As the foreign secretary, William Hague, announced the expulsion of the Libyan charg d'affaires and eight remaining Libyan embassy staff in London, British diplomats in New York planned to unfreeze assets covered by UN sanctions.
Britain has frozen 12bn of Libyan assets since the conflict began in February this year, the bulk of which will remain frozen until the regime of Muammar Gaddafi loses power. But a proportion of the assets can be released if Britain can prove that they will only be used by the Benghazi-based National Transitional Council (NTC).
The push by the UK, which has temporarily closed its embassy in Tripoli, will raise questions about whether the funds will be used to buy arms. Foreign Office sources said assets would remain frozen if there is any evidence or suspicion that they were being used to pay for arms, even for the Libyan rebels. Arms sales of any description to any quarter in Libya are banned by UN sanctions.
But a source close to the NTC said funds may be used to buy weapons. "We can't," a source close to the NTC told the Guardian when asked how it would make sure funds are not used to buy weapons.
The source added: "We are militarily engaged in removing Gaddafi. Therefore it would be a bit strange to say that we are happy for you to have the no-fly zone, but rather that you didn't buy arms.
"They [the NTC] haven't been able to meet their payroll, which is their biggest problem to keep going. They also desperately need money to buy arms, particularly in the western mountains where there is often one weapon between two fighters, who go into battle hoping to get one from the enemy or a fallen comrade! ."
Libya's deputy foreign minister Khaled Kaim condemned the UK for recognising the NTC as the "sole governmental authority" in Libya. Kaim said the decision was "unprecedented in diplomatic history" and that he considered it "a stain on the forehead of Britain".
Kaim said: "It's illegal, it's irresponsible and for us it was a surprise to happen from the British government because if other countries will [follow] Britain, then the international diplomacy will be chaos."
He said Libya would try to reverse the decision by legal action in British courts and the international court of justice.
Hague paved the way for the unfreezing of assets after expelling the last remaining diplomats loyal to Gaddafi and announcing the embassy would be taken over by the NTC. The charg, Khaled Benshaban, was summoned to a meeting at the Foreign Office, where he was given three days to leave Britain. Other diplomats at the Libyan People's Bureau in London have been told to leave over the course of the summer.
Shortly after the meeting with the charg, Hague invited the NTC to nominate an ambassador and other diplomats to take over the Libyan mission. In a statement crafted with the advice of Foreign Office lawyers and the attorney general, Dominic Grieve, Hague said: "The prime minister and I have decided that the United Kingdom recognises and will deal with the National Transitional Council as the sole governmental authority in Libya."
The remarks by Hague allowed the government to unfreeze 91m in UK assets belonging to the Arabian Gulf Oil Company, a Libyan oil firm under the NTC's control, which had been on an EU sanctions list.
Assets would be unfrozen by using three main methods:
Exemptions for basic services, such as paying for food and fuel. That can be agreed at the UN security council without a vote as long as there is a consensus.
Provision for exceptional services such as medical supplies. That would need a formal vote.
Releasing large assets. That would also n! eed a fo rmal vote. Britain would not apply for the release of these assets, which are inextricably linked to the Gaddafi regime, until the Libyan leader leaves power.
Speaking about Britain's move to recognise the NTC, Hague said: "This decision reflects the National Transitional Council's increasing legitimacy, competence and success in reaching out to Libyans across the country. Through its actions, it has shown its commitment to a more open and democratic Libya, something that it is working to achieve in an inclusive political process. This is in stark contrast to Gaddafi, whose brutality against the Libyan people has stripped him of all legitimacy."
Hague has warned that a lot of the democratic changes made during the Arab Spring could be at risk from internal political issues and sectarianism.
"The next few months could be quite turbulent and difficult in Egypt," he said in an interview with the Times. "One of the risks in the Arab Spring is the unleashing of sectarian divisions."
"What has started this year will take a generation to work through," he added. "We mustn't expect each country to be neatly done in six months. It's not a computer game that comes to an end when you get bored. It's not a TV programme that finishes at 10pm. We are going to be working at this for the rest of our lives."
The foreign secretary said that Britainnow runs its largest diplomatic mission in north Africa after Cairo in the Libyan rebel stronghold of Benghazi. This will be designated as an embassy if the NTC requests an upgrade.
The decision to recognise an opposition group is a rare step for Britain, which declined to follow the example of the French president, Nicolas Sarkozy, who recognised the NTC at the start of the conflict. Britain said at the time it could not recognise the NTC because it recognises states rather than governments.
A Foreign Office source said Britain would continue to abide by the convention by which it recognises states rather than governments, saying: "Thes! e are ex ceptional circumstances. It was an anomaly that we had these people here still representing Gaddafi ... we dragged in the charg d'affaires. He and his colleagues are now packing their bags."
The Treasury has frozen the assets in the UK of 39 individuals in Gaddafi's government, family and army.
A further 53 entities have had their assets frozen including oil companies, airlines, property firms, banks and investment authorities in London, the Isle of Man, the British Virgin Islands and in Libya.
In February, 900m of recently printed hard Libyan currency was impounded in the north-east of England. The assets of six Libyan ports were also frozen, including the port in the oil town of Ras Lanuf in the east of the country which was claimed by rebel forces in March.
Hague said Britain only decided to recognise the NTC after it was certain that Libyan students in Britain, who are funded by their embassy, would continue to be supported.
He added that the appearance this week on Libyan television of the Lockerbie bomber Abdelbaset al-Megrahi showed it had been a mistake by the Scottish justice minister to release him on compassionate grounds in 2009. Hague said no deadline has been set for the military campaign against the Gaddafi regime. British military chiefs have advised ministers they can continue with the bombing indefinitely.
Hague, who appeared to indicate earlier this week that Britain was more relaxed about Gaddafi's personal future, made it clear that it would be better if he left Libya. But Britain could not dictate the outcome of a political settlement to the Libyan people.
"Let's point out though, at the same time, that the view of the chairman of the NTC is that any successful political settlement does involve Gaddafi leaving Libya and that is what we continue to say is the best solution," he said. "So don't make any mistake about that, but we're sayin! g we can 't impose that or guarantee that."
Hague also said Britain was committed to ensuring Gaddafi faced justice before the international criminal court.
The foreign secretary denied that discussions about Gaddafi were part of a back-channel communication with the regime, but did not deny that such a channel existed. The renewed diplomatic offensive comes as British aircraft stepped up the bombing against Gaddafi's security and intelligence apparatus before the start of Ramadan on 1 August.
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