Libya’s UN-backed government wants control of wealth fund


Libya’s UN-backed government has formed a board of trustees and appointed directors for the country’s contested sovereign wealth fund, moves opposed by those laying claim to the key financial institution.

The Libyan Investment Authority (LIA), which holds about $66 billion-worth (£51 billion) of mostly frozen assets, is the subject a long ownership struggle in a country where rival factions support different governments.

The fund is a potentially important source of income for Libya, whose economy is in crisis because of conflict, diminished oil revenues and bloated public salary and subsidy bills.

The UN-backed Government of National Accord (GNA) said the new board of trustees included GNA prime minister, the ministers of finance, planning, and economy and the governor of Tripoli’s central bank.

They held an inaugural meeting on Saturday, where they appointed a board of directors made up of members of an LIA steering committee the GNA nominated in 2016.
“Under the new legal framework, the board of directors will have full authority to deliver the strategic, operational and legal vision of LIA, by building an institution that is transparent, accountable and neutral,” a GNA statement said.

Head of the board of directors, Ali Mahmoud Hassan Mohamed, said: “This positive move provides us with the mandate and the authority to continue the reform programme we initiated last year.”

The GNA’s steering committee nominated last year was challenged by AbdulMagid Breish, appointed LIA chairman in Tripoli in 2013, leading to a struggle for control of the LIA offices in Tripoli.

Breish, who said the committee was illegal because the GNA has never been endorsed by a parliament based in eastern Libya, won a legal appeal against its creation. He previously said any attempt by the GNA to set up a board of trustees would be “a blatant abuse of power”.

Ali Shamekh, appointed chief executive of the LIA by authorities in eastern Libya in 2016, also questioned the latest GNA move, saying a board of trustees under Libya’s eastern government already filed a court appeal against the new, rival board.

The GNA said the formation of its boards was in accordance with a law regulating the LIA and any move to contest it would be “destabilising”.

A UN report last month pointed to losses due to the failure to reinvest matured LIA investments, but concluded it would be difficult to modify the sanctions regime while the fund remained divided.