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The Russian-Libyan rapprochement: what has Moscow gained?

Article Excerpt
In mid-April 2008, outgoing President Vladimir Putin went to Libya. He was the highest-level Russian official ever to visit this petroleum-rich North African country. A number of agreements were reached then, including a resolution to Libya's Soviet-era debt to Moscow, a contract for Russian Railroads to build a railway line between two Libyan cities (Sirte and Benghazi), and a memorandum of cooperation between Gazprom and the Libyan National Oil Company. There were also reports that major Russian arms sales to Libya may be forthcoming. In addition, Gazprom appears set to become heavily involved in Libyan gas exports to Europe through a swap of some Gazprom assets in Russia in exchange for some of the assets in Libya of ENI, Italy's multinational oil and gas company. In July 2008, Gazprom proposed that it buy all Libyan petroleum intended for export.

Gazprom's growing Libyan presence has led some to fear that Moscow is attempting to dominate European gas imports not just from the east, but also from the south. This fear has only been furthered by Libyan leader Colonel Muammar Qadhafi's enthusiasm for a "gas OPEC" and, despite his recent rapprochement with Washington, for Putin's confrontational approach toward America and the West. Far from presaging a Russian-Libyan alliance, however, the April 2008 Putin visit to Libya may actually have been an attempt to play catch-up with the West (especially Europe), which had benefited from the end of Libya's isolation following the lifting first of UN and later U.S. sanctions against it. Nor is it clear that Gazprom's offer to buy all of Libya's petroleum exports will be accepted. Finally, as some Russian analysts have noted, the benefits that Moscow receives from improved relations with Tripoli may turn out to be relatively limited.

BACKGROUND

Although Libya was not as firm a Soviet ally as many Third World Marxist regimes were, Moscow developed close ties with the anti-Western regime of Qadhafi, who had overthrown Libya's pro-Western monarchy in 1969. The number-two Soviet leader at that time, Aleksei Kosygin, went to Libya in 1975, and Qadhafi visited Moscow in 1976, 1981 and 1985. Soviet-Libyan trade volume during the 1970s and 1980s was approximately $100 million per year. (1) During this period, Moscow also supplied $4.6 billion in weaponry to Libya, providing about 90 percent of that country's arms inventory. (2) According to Kommersant, "Libya was one of the Soviet Union's few partners that paid in full for the military equipment it purchased from the USSR." (3) Libya, however, did run up a debt to Moscow during these years.

With Russian support, however, the UN Security Council imposed sanctions on Libya in 1992 (at the height of Yeltsin's pro-Western foreign-policy orientation). Russian-Libyan trade dwindled to $1 million per year by the mid- 1990s. (4) Due to the UN sanctions, Libya claimed it was unable to repay its debt to Moscow. (5)

In April 1999, UN sanctions against Libya were lifted. Yeltsin suspended Russian sanctions against Libya the following month, but America's remained in place. (6) It initially appeared that Russian-Libyan economic relations would resume. Aeroflot service between Moscow and Tripoli started up again in June 1999. (7) A contract was signed for a Russian firm to build a 117-kilometer natural-gas pipeline inside Libya. (8) In mid-2000, Promeksport began implementing contracts...

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