Libya in from the Cold: Economic & Foreign Policy Developments Since 2003

More than 3 years of rapprochement with the West and dramatic shifts in foreign policy have yet to reward Libya with the full benefits of the economic rewards that were expected to materialise. In this paper, Murad H. EL-Anis provides an overview of developments in Libyan economic and foreign policy since its return from the ‘cold’ and provides an indication of where Tripoli is now looking to achieve its ambitions

For the best part of two decades Libya had been an international outcast amid hostile relationships with key western powers and a lukewarm association with regional neighbours at best. Prevalent tensions that characterised Tripoli’s foreign relations and international policy stemmed from a number of intrusive crises, including government links to terrorism illustrated in the Berlin Disco bombing of 1986 and the Lockerbie case of 1988 (amongst others), in which Libyan agents were implicated (and later found guilty of terrorism charges). Adding to the country’s unpopularity with the west was an openly hostile stance towards Israel and US strategic interests in the Eastern Mediterranean during the 1980’s and 1990’s were considerably worsened by Libyan President Qadhafi’s pursuit of covert WMD programmes.

International trade fares have become frequent events in Libya as it strives to promote international trade and investment.

The consequences imposed by the US, EU and the UN served to close Libya off from the international economy and contract the country’s economy throughout the last two decades of the 20^th century. Reagan imposed complete restrictions on US passport-holder travel to Libya in 1981; the following year the US banned all imports of Libyan oil and a number of export products deemed of dual civilian-military use as well as being vital to the Libyan economy; the Berlin Disco bombing in 1986 lead to a broadening of US sanctions to include a comprehensive ban on all US-Libyan trade, commercial contracts and travel between the two countries; in 1996 Congress passed the Iran-Libya Sanctions Act (ILSA); and in 2001 the ILSA was amended to allow the Whitehouse to impose economic punishments on non-US firms investing more than US$20 million annually in the Libyan (and Iranian) energy sectors.

 

EU and UN sanctions were not applied to Libya until a decade after the first US impositions and were considerably less wide-ranging. In 1992/1993 the Security Council imposed an air and arms embargo on Libya and banned the sale of oil-sector equipment to Tripoli in order to pressure Qadhafi to hand over two Libyan suspects in the Lockerbie bombing. Libya was, however, to come in from the cold in Spring 2003 following a lengthy series of closed-door negotiations – primarily with European partners – that resulted in a number of progressive developments. Dating back to 1999, the EU and UN both suspended sanctions on Libya following the submission of the two wanted suspects in the Lockerbie case and the subsequent dialogue that broadened into other areas of concern. Four years later, Qadhafi agreed to pay US$2.7 billion in compensation to the families of the Lockerbie victims (over 170 families in total), which resulted in British PM Tony Blair drafting a UN resolution to authorise the permanent lifting of all UN sanctions. The EU concurrently indicated that it would lift sanctions also and the US stated that it would not object to such measures even though it would not lift its own sanctions. Further compensation paid in relation to a French UTA airliner bombing, which occurred in 1989, resulted in all UN sanctions being lifted on 12 September 2003.

 

When Libya announced at the beginning of 2004 that it was abandoning its WMD programmes and opened up their formerly guarded secrets the international community was largely stunned. This was, however, the culmination of years of talks between Tripoli and key western governments that were kept out of the public sphere. The US-led invasion of Iraq several months earlier is seen as a key factor that led to this dramatic move as are apparent offerings Washington made to Tripoli in order to encourage an abandoning of WMD interests. In April 2004 most US sanctions were halted as a result of the move and in September President Bush formally lifted those that remained – including general trade, aviation and the importation of Libyan oil. In October, the EU followed-suite and lifted all sanctions, including the sensitive arms embargo. This largely followed Italian and German pressure to liberate EU-Libyan relations, as both had distinct economic interests in mind – such as Italian aspirations to export hi-tech equipment to Libya for border control and countering illegal immigration.

 

Libya turned to economic reforms and trade liberalisations to capitalise on the removal of sanctions which had locked off much of the potential economic growth that now seemed achievable. This also involved a shift in foreign policy relations that saw a disgruntled Qadhafi distancing himself from the League of Arab States, partially restricting the country’s relationship with the EU to bi-lateralism and turning to Africa and the newly established African Union as his bastion. However, the economic reforms undertaken have not diversified the economy away from over-dependence on the oil and gas sector and the reform of institutions to remove Non-Tariff Barriers (NTB’s) such as licensing authorities and investment partnerships, has been limited. Furthermore, political reforms have been negligible, leaving major issues such as human rights, party politics, political participation and the development of an active civil society have hindered the country’s political foreign relations. The lack of genuine political reforms have also hindered the expansion of a competitive, export-orientated and investor-friendly economy. Without a commitment to extensive and conclusive political reforms that are pursued with sincerity the success of economic reforms and rapid growth of the economy will be under question.

 

Developments in Key Fields of Cooperation

 

Libya’s economic and demographic characteristics offer enormous potential for rapid economic growth. With a population little over 5.8 million, ample land exceeding 1.75 million km², and vast hydrocarbon assets Tripoli does not exactly face a crisis of resources (other than fresh water limitations). However, a monstrous public sector has dominated sectoral distribution of the labour force and had hampered diversification, until the January 2007 announcement by Qadhafi that 400,000 civil servants would be laid off (a third of the workforce). This painful measure is in line with the government’s policies of economic reform and is being undertaken in order to cut public spending and stimulate the private sector, but will prove politically costly in the short- to medium-term. It is one example of the lengths to which the government is willing to go in order to meet reform targets in the economic sphere. It is in the economic sphere that reforms are being pursued rather than in the political where liberalisations are notably limited, human rights abuses are still evident and press and media freedoms are largely as restricted as they have ever been. The appointment of Shukri Ghanem in June 2003 - a liberal technocrat and advocate of the market economy – as PM was a positive step and seen as a victory for the liberal reformers. However, his removal and the appointment in March 2006 of Baghdadi Mahmoudi – a more conservative figure with distinct reservations of political reform – has to some extent symbolised a slowdown to the prospects of political liberalisation of 2003 (Fernandez, 2006). Within the economic sphere there are some evident trends in reform policies that correspond clearly to prevalent sectoral orientations.

 

Oil - The primary theme evident in the reform portfolio is that of the energy sector. Libya’s production capacity in 2006 was on average 1.65 million barrels per day (mbd), which actually fell far short of the 3.2 mbd it had produced in the 1970’s. With proven oil reserves of 39 billion barrels (equivalent to 40% of total proven reserves in Africa) and an international market desperate to secure medium- to long-term energy sources there is massive potential for Libya to re-enter the market lucratively. Traditionally, the energy sector in Libya had been operated relatively autonomously and as a result with efficiency. However, during the sanctions era this efficient management was not sufficient in overcoming the endemic problems faced by an aging and wearing oil industry. In order to recover from the setbacks of the previous two decades and replace the infrastructure needed to reach a similar or higher output to that of the 1970’s it is estimated that Libya will need to attract over US$30 billion of FDI (EIU, 2006).

 

Exploration and production licences have been awarded at an accelerated rate over the last two years, with US firms stepping back into their former productive roles in the Libyan oil sector – two of the last licence auctions having been awarded to ExxonMobil, ChevronTexaco and Oasis Group, all of the US). However, there is tough competition emerging from the EU and notably a very significant increase in Chinese and Southeast Asian investor presence that has come to challenge US corporations. In 2006 there was a noticeable hesitation within the Libyan authorities in awarding a number of exploration contracts, however, that were potentially linked to what is being seen as US reluctance. If Libya is to be able to overhaul the oil sector and reach the 3mbd by 2015 quota set by Qadhafi, the pace of investments and contract awards will have to remain high. The main issue here is the shortfall in dividends granted by the US for Libya’s political realignment. Tripoli, it seems, is pursuing a cautious route on which it does not over-commit and over-compromise in a manner that is not correlated by Libyan policy in Washington. Therefore, even though international competition for Libyan oil exploitation is clearly a healthy attribute to the industry, it is being kept in check to ensure that the Bush Administration will not feel tempted to renege on promises of closer political ties due to the prospects made available to US investors. In either case, Asian, European, American or other FDI sources is fundamental in restoring the oil industry that lies at the heart of Libya’s economic reform project.

 

Trade – Boosting trade with major partners is a high priority for Tripoli, which has signed or is in the process of negotiating a number of bi- and multi-lateral trade agreements. These include Libya’s membership of the Greater Arab Free Trade Area (GAFTA) signed in 1998 and which came into full force in 2005, observer status in the Euro-Mediterranean Partnership (EMP) and bi-lateral agreements with a number of regional and global partners, including Syria, Jordan and China amongst others. Following the 2003-2004 sanctions abolishment Libyan trade has been opened up to the international market and exposed to competitive market forces in a way that it had not experienced since the 1970’s. These trade agreements or negotiations have helped mitigate the domestic fallout of warming trade relations in a country that has a very serious and ongoing unemployment and underemployment problem. But, oil still remains the single major export product, over-pressurising this sector and under-pressurising other sectors, such as manufactures, agriculture, textiles and pharmaceuticals that could otherwise become significant contributors to the trade balance.

 

Nonetheless, in 2006 Libya was the world’s 35^th exporter, although with what appears to be a meagre 0.4% of total world exports but of a considerable value of US$31.1 billion (WTO, 2006). This was a dramatic 46% increase in export value over the previous year (US$23.2 billion). The EU has remained Libya’s major trading partner over the last two decades and is exceeding in this role in the post-sanction era, although Libya is only the EU’s 19^th trade partner. In 2001, Libya imported €11.6 billion from the EU but exported just €3.0 billion resulting in a trade deficit of €-8.6 billion. By 2005 this balance had sunk further to €-15.9 billion as Libya imported €19.5 billion to the EU (an increase of €7.9 billion) but only exported €3.5 billion (an increase of €0.5 billion). This negative shift was largely a result of Tripoli’s desperate need to gain access to import goods that had been blocked since the early 1980’s as well as the expansion of the EU to 25 members – the additional 10 being East European economies that Libya has traditionally imported from but has not exported to (as Libyan exports are dominated by the oil sector and the new EU-10 imported their energy needs primarily from Russia). The deficit was not a very welcome sign in Tripoli. Libya has since sought to attract more FDI from the EU, which has become a major source of investments that counter’s some of the trade deficit’s negative affects but is not factored-in when reviewing trade statistics.

 

Libyan trade within the MENA has not, however, changed considerably since the international sanctions of the 1980’s and 1990’s were lifted. Despite Libya’s member status within GAFTA and bi-lateral trade agreements with regional partners, Libyan-MENA trade remains strikingly low. This again relates to Libya’s over-reliance on oil and natural gas as chief export products, which consequently has limited the export market within the region – chiefly to Maghreb partners. Imports, on the other hand, like much of the region’s economies have come mostly from the EU, Asia and the US with only a small market penetration for regional commodities. Libyan exports to Arab partners totalled US$540.92 million in 2005, down from US$592.99 million in 2001 while imports totalled US$715.63 million in 2004, considerably up from US$450.85 million in 2001 (AMF, 2006). Of this trade, Tunisia was the major exporting and importing partner (exports: US$389.92 million in 2001 [67.1%] and US$372.73 million in 2004 [69%]; imports:US$159.76 million in 2001 [35.3%] and US$396.01 million in 2004 [55.8%]) , while Libya traded almost negligibly with the remaining regional partners with only a few exceptions. Morocco, Egypt, Jordan, UAE, Lebanon and to a much lesser extent Sudan, have been the only other MENA partners with whom trade has been worth noting over the same period.

 

In each of these four cases, trade patterns have emerged that indicate towards some linkage with the pre- and post-sanction era. In the case of Morocco, imports less than halved in the same 2001-2004 period whereas exports almost doubled. Libyan imports from Egypt grew considerably whereas exports declined. Imports from Jordan increased very slightly while exports to the kingdom declined marginally. Where the UAE is concerned imports rose dramatically by 2004 but exports declined to virtually nothing. It is worth noting here that the UAE did not have any considerable trade with Libya until 1998. Lebanese imports to Libya faded considerably between 2001 and 2004 but exports to Lebanon more than doubled. Imports from Sudan declined as did exports in the same period. These shifts contradict Libyan trade patterns with its Arab neighbours during the 1990’s, although not universally, which appear to have been largely reversed and are largely attributed to Qadhafi’s foreign policy re-orientation towards Africa (see below) as well as his dissatisfaction with a number of regional governments for their compliance with the sanctions regimes.

 

Libyan trade with the US had been virtually non-existent until the 2003-2004 lifting of sanctions. In terms of exportation, Libya exported US$314.46 million to the US in 2004, a considerable gain in the immediate aftermath of sanctions eradication. Imports, however, after having been negligible throughout the 1990’s peaked at US$597.93 million in 2003 and then shrunk to US$11.48 million in 2004 (AMF, 2006). The trade surplus was appreciated in Tripoli but had become a sore for Washington, which continued to demonstrate that its primary interests in Libya were not necessarily ones of economic gain but rather security-orientated. This has continued to remain the order of the day in Libyan-US relations. Although, other major trading partners, such as Japan and Switzerland (US$464.75 million in 2001; US$611.44 million in 2004 & US$39.95million in 2001; US$69.59 million in 2004 respectively) increased their trade share with Libya in the same period of 2001-2004, growth in US investments and trade is seen as the key to reaching Libya’s full potential of economic growth. This relationship and the prospects for trade growth remain hampered by the conflicting conceptions of what the relationship between the two former rivals should be anchored in: Tripoli seeking US trade and investment and Washington security arrangements if anything at all. It is to this issue of security cooperation that we shall now turn.

 

Security Cooperation – Libyan security cooperation with its international partners has revolved, since 2003, around two core concerns: the rise of radical Islam & terrorism and illegal immigration (primarily if not exclusively to the EU). The extent to which Tripoli has consequently built cooperative relations with the major western political communities correlates closely to these two fields. Washington seems to have placed the bulk of its cooperative framework within the theatre of combating international terrorism and the rise of radical Islam – Qadhafi’s government being the first to warn of Al Qaeda’s deviant activities and the threat it posed to international security and the history of the regime’s conflict with extremist Islamic groups has served to bolster this area of collaboration – whereas illegal immigration has been of virtually no concern. The EU, on the other hand, has placed more emphasis on illegal immigration, largely under Italian pressures. In 2006, it was estimated that as many as 700,000-1,000,000 illegal immigrants from sub-Saharan Africa were in Libya, the majority of who were on-route to the EU via the Italian islands of Lampedusa and Sicily.

Both parties appear eager to utilise the security arena as a parallel tier – along with trade expansion – to strengthening the ties that have been built over the last four years. This interest is not necessarily mutual, however, in the respect that the EU views this security assistance as directly linked to internal interests whereas Tripoli perceives it more as a mechanism by which the EU’s support can be won. There are some sticking points here that need to be overcome before ties can be strengthened, particularly in this area, including Libya’s notorious human rights record and a number of recent or ongoing cases – such as the Benghazi HIV scandal involving Bulgarian nurses and a Palestinian doctor.

 

In 2006 the US State Department removed Libya from its list of state-sponsors of terrorism under the Bush Administration’s instruction making Libya the first country ever to be removed from the infamous list. Qadhafi has described Libyan counter-terrorism cooperation with the US as “irrevocable” and both have moved to develop this cooperation by incorporating Libya in the interagency Trans-Sahara Counter Terrorism Initiative (TSCTI). This would permit Washington to extend counter-terrorism assistance in both financial, material and training terms to Libya (Blanchard, 2006). All of Libya’s neighbours except for Egypt and Sudan are members of TSCTI and it is expected that Tripoli’s appointment to the group would help strengthen cross-border cooperation with these neighbours, which is sought by Washington but a measure held with some contention by Qadhafi (see section on Libyan foreign policy below).

 

That said, in 2004 Libya transferred Amari Saifi (also known as Abderrazak Al Para) the deputy commander of a militant Islamist group, the Salafist Group for Call and Combat (GSPC) to Algeria where he was wanted on terrorism charges. Qadhafi has also called on other Arab governments to maintain close counter-terrorism contacts with the US and is party to all 12 international conventions and protocols relating to international terrorism. Nonetheless, Tripoli’s security cooperation with MENA neighbours has not developed greatly in stark contrast to its warming stance towards the west. The traditional lukewarm relationships Libya maintained with its Arab neighbours for the last two decades have either continued or cooled further. This can be illustrated by the discomforting case of an alleged plot to assassinate Saudi Crown Prince Abdullah in 2004 in which Colonel Qadhafi was directly implicated. The affair soured relations with many Arab governments and strained the country’s unsure relationship with the US.

 

Developments in Libyan Foreign Policy

 

Qadhafi’s decision to call an end to his country’s WMD and delivery system programmes and the overarching realignment of foreign policy has been motivated mainly by the prospect of economic gains. Political isolation and economic sanctions took a heavy toll on Libya’s economy and created a broad range of socio-economic crises that have resulted in threats to the regime. Combined with the ambitious pursuits of transforming Libya into a competitive and expanding economy, these threats have played a big role in motivating developments in Tripoli’s foreign policy. Such developments can be categorised in four distinct groups: relations with the EU, US, MENA and Africa, wherein significant policy shifts have transpired in the 1999-2006 period. In short, Libyan foreign policy can be summed-up as one orientated towards (i) rapprochement with the west – EU and US, (ii) quasi-neutrality in the MENA and (iii) expansion in Africa. In (i) developments can be explained by economic motivations, in (ii) political-economic, and in (iii)  by economic-political.

 

The West: EU – Libya’s relations with the west are often neatly placed in the context of closer and warming ties since 1999. Indeed, by 2004 several key European leaders paid official visits to Tripoli, including Tony Blair, Gerhard Schroeder, Jaqcues Chirac and Silvio Berlusconi. The Europeans had been more receptive to the notion of tying Libya into the political mainstream than had the Bush Administration, which has not sent over a Presidential delegation as of yet. There are a number of reasons behind this, which have been explored above and can be summarised as a result of the greater geo-strategic and historical relevance Libya has for the EU and vice versa. However, Libya’s foreign policy towards the EU is not without its reservations. There are a number of mutual interests that Tripoli shares with the EU, such as trade relations, immigration, counter-terrorism, telecommunications, transport, health and educational services, financial services, legislative reform, tourism, agriculture, infrastructure and environmental protection, all of which are areas of combined projects or dialogue. But, Libya still remains outside of the EMP and has demonstrated a bi-lateral approach to Euro-Med policy.

 

Due to Libya’s observer status in the EMP, Libyan delegates sit on high-level political talks and are incorporated in the dialogue functions of the partnership, but are yet to apply for membership. The formal reason given by Tripoli for this is that a Libyan delegation was not present during the Barcelona Conference held in 1995 and therefore Libya was not afforded the opportunity to have its say in the drafting of the Barcelona Declaration on which the EMP is based. Furthermore, by calling upon the need to resolve the Palestine-Israel crisis before a regional FTA can be established, Qadhafi has effectively signed-off on his country’s absence from the EMP for some time to come. Although these are credible arguments, it is also likely that there is no real perceived need within the Libyan government to commit to the EMP and its significant domestic political compromises. This is effectively due to the fact that the trade growth, FDI and other assistance Libya seeks to source from the EU as well as the growth in exports to the union are primarily involved with the oil and gas sector, which does not require the EMP framework to support it. Within some circles, it is felt that active involvement in the 5 + 5 Group (incorporating Algeria, Libya, Mauritania, Morocco and Tunisia to the south and France, Italy, Malta, Portugal and Spain to the north) could be a more productive route as it primarily involves palatable trade liberalisations. The 5 + 5 Group could also be a graduating basis for full entry into the EMP should economic diversification policies within Libya grow in importance therefore increasing the appeal of the multi-lateral framework.

 

The West: US – Libyan foreign policy towards the US – the desired major western partner – has become somewhat unrequited and less active than that towards the EU. Libyan interests here have led to political cooperation and a reversal of the hostilities both countries openly posed to one another pre-2003/4. However, where Libya has sought to warm relations with the US in order to open up the US consumer market for Libyan exports and build a strong FDI source as well as technical assistance from American firms, this transformation has not taken place. Washington has not reciprocated sufficiently in demonstrating genuine interests in Libyan political cooperation by failing to deliver the expected economic dividends, as well as political support, to Tripoli. One of the cornerstones of Libyan foreign policy shifts towards the US has been the attempt to draw in US investments in the oil industry to revitalise the sector and provide tough competition for European investors, but this has been very slow to materialise. All in all, Tripoli’s foreign policy towards the US has gone only so far before stalling at a point where hostilities are a thing of the past and cooperation is partially evident, but only in the security area while broader interactions remain limited.

 

MENA – Libyan foreign policy towards its Arab neighbours has almost undergone a u-turn in recent years. Tripoli has largely withdrawn from the Palestine-Israel debate, remained comparatively quiet on the Iraq issue and generally adopted a neutral stance towards most of the states in the MENA. Qadhafi’s disenchantment with the concept of pan-Arabism and the apparent lack of any real, coherent Arab platform for unity – demonstrated quite specifically here by the compliance with international sanctions witnessed amongst virtually all Arab states – have led to a serious disinterest in the ‘Arab framework’ (Mack, 2005). The removal of sanctions and warming ties with other international partners has allowed Tripoli to turn away from Arab partners, with whom very little trade or political alliance exists anyway, in favour of more amenable partners. Libya has even threatened to withdraw from the League of Arab States and GAFTA on a number of occasions, although these remarks are seen more as the voicing of discontent rather than genuine announcements.

 

Africa – Libya’s foreign policy towards Africa has been more progressive than the MENA equivalent with a major drive to develop the African Union and economic ties with African partners. In June 1999, Qadhafi proposed a United States of Africa be formed and backed up this proposal with promises of Libyan funding, economic aid and selective military transfers to partners. Considered over-ambitious and serving to raise considerable scrutiny within Africa, the proposal was diluted but nevertheless resulted in the formation of the African Union in 2002. The transformation of the nascent Organisation for African Unity (OAU) into the African Union (AU) has marked the greatest shift in Libyan policy towards the continent and is both symbolically and practically an embodiment of Tripoli’s interests in building its role in Africa. Modelled on the institutions of the EU, the AU has been far more active in continental affairs than its predecessor, the OAU. Its primary focuses revolve around increasing development, poverty reduction, bringing an end to corruption and ending conflicts amongst and within the 53 members (Morocco being the only non-member).

 

Libya is also negotiating its ascension into the Common Market for Eastern and Southern Africa (COMESA), which will grant it free trade access to the markets of 13 other members of the FTA. Libya is Africa’s fourth largest exporter with 10.1% of total African exports but most of this trade is with non-African partners, which is a condition that Tripoli would like to see shifted in favour of greater intra-African trade. The key for Libyan foreign policy, at large, will be the extent to which Tripoli can build committed relationships with major trade partners, including the EU and emerging Asian partners; play a leading role in the AU and press for its advancement in order to prevent the same ineffectiveness that plagued the OAU; and whether or not Qadhafi can compel the US to engage more constructively and actively, both on an economic and political level. By adopting a leading role in Africa, which is attracting growing international interest with China and India fervently building closer ties with many trade partners on the continent, the US announcing its Africa Command and exploring prospects for close economic and political ties to the continent and the UN looking to play a more active role there, Libya can position itself as a key player – both in African internal affairs and Africa’s international relations. Acting as a constructive player in Africa rather than a rogue on Africa is sure to bring considerably greater rewards and could be a flagship for a new Africa in the 21^st Century – if all goes to plan.

 

Bibliography

 

Arab Monetary Fund, (2006), Foreign Trade Statistics 1994-2004, AMF Publications

 

Blanchard, C., (2006), Libya: Background and US Relations, CRS Report for Congress, Congressional Research Service, Library of Congress

 

Economist Intelligence Unit, (January 2006), Libya Country Report, Economist Intelligence Unit, London

 

European Commission, (December, 2004), Technical Mission to Libya on Illegal Immigration, European Commission Publication

 

Fernandez, H. A., (2006), Libya’s Return: Between Continuity and Change, Real Instituto Elcano

 

Mack, D., (24 March 2005), ‘Libya and the United States at a Turning Point’, Remarks Delivered at Johns Hopkins School of Advanced International Studies, The Middle East Institute

 

WTO, 2006, International Trade Statistics 2006, World Trade Organisation Publication, Geneva

 

 

MENAAR | March-April 2007

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The EU’s decision to lift the arms embargo on Libya was greatly inspired by this issue in order to allow border control and internal security apparatus to be improved (European Commission, 2004). This also involved free training of Libyan police and exchanges in techniques, intelligence and best practices. The EU has, it needs to be noted, become interested in building strong ties over the issue of terrorism and radical Islam also, though to a lesser extent than the immigration matter. By playing an active role in securing the EU’s external borders and partaking in collaborative Euro-Med policy, Libya can secure EU assistance, trade exposure and support of the Qadhafi regime.

EU leaders were eager to approach Qadhafi with warmer relations after Libya’s dramatic moves at the end of 2003. Both parties had differing views of what they each wished to gain from the new cooperative relationship but there has been consensus on these mutual gains.