Published on the Malta Independent¸ issue 28th August 2011
The news of the downfall of a tyrant who ruled Libya with an iron fist for 42 years could only send confidence levels up in the beleaguered eurozone .We all watched extensive coverage on foreign TV channels showing hundreds of victorious Libyan rebels entering Gaddafi’s forbidden city of Bab al’ Aziziya. This jubilation is reminiscent of the fall of Saddam Hussein in Baghdad. In Libya we witnessed the rebels pulling down the gold decapitated statute of the colonel. Memoirs of a bygone era were discovered in Gaddafi’s inner sanctum including documents giving evidence of his tyrannical rule. Rebels in Bab al Aziziya also wanted to be remembered for posterity atop a golden statue showing a clenched bronze fist symbolically clutching a US fighter jet. It was sweet revenge for a Libyan people who has quietly endured the servitude imposed by a dictator who had skilfully manoeuvred top European leaders to dance to his tune. Undoubtedly¸ oil wealth opens new horizons and with clever brinkmanship Gaddafi outsmarted many a Tony Blair of this world. But how the mighty have fallen!
Forty-two years is a lifetime for any young nation that silently endured repression¸ a poor infrastructure¸ no rule of law¸ and no freedom of expression. Now the National Transitional Council (TNC) has started to plan for a post Gaddafi Libya to become a democratic Muslim country governed by the rule of law. But can the heads of tribesmen in Libya ever forget the torture¸ corruption and repression and give the old regime a ‘fair’ trial. Not so easy. Again looting the rich bounty amassed by the dictator and his family and his coterie of close friends will be difficult to halt. It is no consolation for the underprivileged masses to be told that after four decades of shameful standards of living their leaders had billions stashed away in foreign bank accounts (apart from vast investments in companies and real estate such as luxury hotels in London).
The positive side of the civil war (which has cost so many lives on both sides) is that the rebels are finally acquiring control of oil refineries and production wells near Brega. After much bloodshed¸ Libyan rebels seized full control of the Zawiyah oil refinery¸ which caused an immediate drop in international oil prices. Sentiment in oil markets was high that Libya will slowly return to full production of its sweet (low in sulphur) oil plus the good news that oil prices tumbled by more than $3 a barrel. As rebel commanders laid claim to 90 per cent of the capital Tripoli¸ the benchmark being Brent¸ crude fell by as much as $3.47 or 3.2 per cent¸ to $105.15 a barrel before regaining some ground. This added some jubilation to an otherwise bearish market sentiment and saw the FTSE 100 enjoy a brief improvement. After losing 5.25 per cent of its value in mid August¸ the FTSE index rebounded¸ rising by 54.54 points to close at 5095.30.The euro also followed with some gains. It is widely known that the six-month civil war has disrupted business in the oil rich desert nation and now that Gaddafi’s reign is reaching its end more scope for a secure revival appears on the horizon.
Foreign companies that were heavily committed in the Libyan market bet that the likely opportunities for business in Libya outweighed the decline in revenues caused by falling oil prices. But nobody knows how long it will take for oil production to reach the pre-Februa