Libya billions held up in sanctions tangle
New York - Governments around the world are holding up billions of dollars in assets ordered released to help the Libyan government which faces a growing cash crunch, diplomats said Wednesday.
The UN Security Council has authorized the release of more than $18bn in assets since easing sanctions in September, but barely $3bn has reached the interim government, diplomats said.
The Security Council is now looking to find ways to pressure government treasuries to overcome bureaucratic obstacles and free the money.
"There is a massive gap," one Security Council diplomat said on condition of anonymity because talks are still confidential.
"There is concern in the council... that despite the fact that more than $18bn of assets have been released only about $3bn have actually got through to the Libyan authorities," the diplomat added.
The UN Security Council froze assets belonging to state companies and the central bank when it ordered sanctions against Muammar Gaddafi in February and March.
The billions were originally released for humanitarian purposes as Gaddafi's battle with the opposition intensified but are not now needed for that reason and so new authorisations have had to be sought.
Libya's interim government needs cash to pay for salaries and to keep public services running, officials said.
Ian Martin, the UN special envoy to Libya, told the Security Council on Monday that the country has "an urgent need for liquid funds".
"The stabilisation of the country, the success of the government and the perception of the international community are all at stake," Martin said.
Libya's oil production is barely one third of the figure before the uprising against Gaddafi started in January and this has badly hit the revenues of the interim government.