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Financial Times http://www.ft.com/cms/s/0/198e48b4-411a-11e0-bf62-00144feabdc0.html Britain and Libya: "No line in the sand" By James Blitz and Lina Saigol Published: February 25 2011 21:56 | Last updated: February 25 2011 21:56 Stood near a Bedouin tent outside Tripoli on Wednesday March 24 2004, Tony Blair offered what he called the hand of friendship to Muammer Gaddafi. That five-second handshake with the Libyan leader was one of the most remarkable moments in Mr Blairs decade-long premiership and in the recent history of the Middle East. For years, Col Gaddafi had been the pariah of the western world, the man US President Ronald Reagan dubbed the mad dog of the Middle East, the instigator of terrorist attacks across Europe. Yet here was Britains charismatic leader standing alongside him, declaring that the whole world would benefit from Libya becoming a strong partner of the west. EDITORS CHOICE Gaddafi forces open fire on protesters - Feb-25.Chinese oil interests attacked in Libya - Feb-24.Editorial: Time to muzzle Libyas mad dog - Feb-24.Libya refugees flee to Malta - Feb-24.Libya regime admits 300 dead in uprising - Feb-23.Editorial: EU - the feeble monster - Feb-23..That handshake quickly came to be known as the deal in the desert. Col Gaddafi promised to cease sowing terror, in return for which international oil companies would help him extract Libyas huge oil reserves. But seven years on, the deal seems like a cynical and ill-judged act in the eyes of many Britons. In the past seven days, Col Gaddafi has emerged once again as the abominable figure he once some would say always was. As he prepared for what may be his last stand in Tripoli, he called on mercenaries to shoot ordinary Libyans protesting against his 41-year rule, whom he calls rats and cockroaches. He has used helicopter gunships to massacre his countrymen from the skies. In a tirade this week, he threatened to cleanse Libya house by house to keep himself in power. Many in Britain now wonder how on earth their government could have contemplated doing business with this man. To be fair, the UK is not the only nation that has cosied up to the colonel. After he renounced terrorism in 2003, several sought to do business with the despot. Prime Minister Silvio Berlusconi has backed him to such a degree that trade between Italy and Libya is today eight times that between Tripoli and the UK. Unlike his British counterparts, President Nicolas Sarkozy of France has received Col Gaddafi in his capital city, where the Bedouin tent was set up within sight of the Elysée palace. The US, Brazil, Germany have all rushed to do business with his regime. Yet some argue there was something unusually intimate craven, even about the political and business relationship between London and Libya. You cannot exaggerate the role that Blair and Britain played in bringing Gaddafi in from the cold, says Professor Fawaz Gerges of the London School of Economics. In 2004, Gaddafi was still a maverick someone dismissed as an insane, babbling idiot by most serious people. By allowing Gaddafi to rebrand himself, Blair sacrificed principle at the altar of economic gain. The rest of British business duly followed. In spite of the mayhem now being visited on Libya, architects of the deal in the desert maintain it was the right thing to do. In the 30 years before the event, Col Gaddafi had been a serious threat to western security, supporting the Irish Republican Army with weapons and instigating the 1988 bombing of a Pan Am airliner over Lockerbie in Scotland that killed 270 people. Yet Jack Straw, foreign secretary at the time of the deal, insists it was a valuable prize because the Libyan leader surrendered weapons of mass destruction that included important elements of a nuclear programme. The situation on the ground in Libya is difficult enough today, he says. But imagine what it would be like now if he had gone on developing that nuclear capability over the last seven years. We would be dealing with an autocrat of questionable mental stability in charge of a nuclear weapons system. This seems to be forgotten by many people. Others, however, question this argument. Sir Menzies Campbell, former Liberal Democrat leader, accepts there was a clear benefit in convincing Col Gaddafi to surrender WMD. But once this had been secured, he believes, UK government and business leaders were too quick to embrace him. We should have been far more sober and fastidious in the way we dealt with Gaddafi after that, keeping a tough restriction on arms sales and holding him to account on his human rights record, he says. Prof Gerges is more blunt. Business interests were dominant from the very start, he says. We needed to make sure that we pressed human rights and the rule of law in Libya. But for too many people, the commercial interests were key. Why and how was British business seduced by Libya? There were two prizes. First, oil and gas. With 44.3bn barrels of proven reserves, Libya has more oil than any other African country, four times as much as Britain and Norway combined. A confidential document recently released by the UK government declares that Libya is one of the few countries with medium-term capacity to bring significantly more energy to world markets. For BP, a company with close relations to the UK government, this was immensely attractive. In 2007, it agreed to invest $900m in a deal to explore Libyan fields. As Tony Hayward, then chief executive, said at the time, this was BPs single biggest exploration commitment anywhere in the world. The second attraction was the operation of Libyan Investment Authority, a sovereign wealth fund worth $60bn-$80bn, according to analysts. The fund, which opened a London office in 2009, has invested in Britain to a lesser degree than rivals in Qatar and Dubai. But it has recently disclosed a 3.01 per cent stake in Pearson, the educational publisher and owner of the Financial Times. It also owns considerable London commercial property assets. Mohamed Layas, LIAs head, told US diplomats last year that he preferred operating in the British capital to the US because of the ease of doing business and the relatively uncomplicated tax system. However it is not just the scale of the trading relationship that has caused alarm but also the close ties between leading UK establishment figures and the Gaddafi regime. Mr Blair has repeatedly insisted he has never had any commercial relationship or advisory role with any member of the Gaddafi family or Libyan company. But the former prime minister, who now runs an advisory business called Tony Blair Associates, has since leaving office travelled to Tripoli on business for JPMorgan Chase, the US bank and met Col Gaddafi as recently as last summer. Saif al-Islam, one of the Libyan leaders sons, has been a regular figure on the London business and social circuit. Other close links exist between former UK government figures and Libya. Sir Mark Allen, the former MI6 officer widely credited with negotiating Col Gaddafis volte-face, later went to work for BP. Robin Lamb and Oliver Miles, who both served in the UK embassy in Tripoli, are leading figures in the trade promotion body, the Libyan British Business Council. Baroness Symons, a Foreign Office minister in the Blair government, is a paid member of the National Economic Development Board of Libya. . . . There have also been repeated indications of how serving British ministers and officials have been keen to accommodate Libya. The most striking is the saga of Abdel Basset al-Megrahi, the Lockerbie bomber, who was returned to Libya in August 2009. A government inquiry this month judged that the last Labour government had done all it could to help secure his release from a Scottish jail. However, leaked US cables give insight into UK enthusiasm for working with the regime. Last year, Sir Vincent Fean, while UK ambassador to Libya, urged US diplomats to engage with the leaders family. We need to work with what we have in Libya and you shouldnt be frightened by the name Gaddafi. It goes with the territory, Sir Vincent is reported as saying. On the same occasion, he told a group of diplomats: Its our job to deliver what [Libya] can absorb, which means starting engagement on their terms. In all of this, there is no allegation that any UK figure is guilty of legal wrongdoing. In the meantime, those who promoted the relationship stand by their actions. I deplore the military action against unarmed civilian protesters, says Lord Trefgarne, a former government minister who now chairs the Libyan British Business Council. But hindsight is a wonderful thing. Nobody for one moment imagined that what has happened in recent days was going to happen. Mr Straw, too, is unrepentant. Libya has oil and so do other countries whose regimes we would not voluntarily choose, he says. The world needs energy and the simple truth is that if we had been more fastidious in our approach, then other countries notably China would have moved in to take our place. Still, as they watch the mayhem in Tripoli this weekend on their televisions, there will be those who find this argument wanting. Convincing Col Gaddafi to give up his WMD may have been an achievement. But for many politicians, the enthusiasm with which he was feted by Britain, Italy, France and other states is troubling. As Sir Menzies says: There was certainly a need for some hard-headed engagement ... and that can be accepted. But the extent to which the Libyan leader was embraced and endorsed by many people in recent times now looks very foolish. .Copyright The Financial Times Limited 2011. You may share using our article tools. Please don't . ________________________________________________ Send list submissions to: Marxism@greenhouse.economics.utah.edu Set your options at: http://greenhouse.economics.utah.edu/mailman/options/marxism/archive%40mail-archive.com
