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US-Libya Business Association Urges Closer Diplomatic Ties
The Washington Diplomat / September 2007

By Larry Luxner

The two-year-old US-Libya Business Association formed in 2005 to promote closer business ties between the United States and Libya is urging Washington to send an ambassador to Libya, build an embassy in Tripoli and finally restore full-fledged relations after 25 years of mutual suspicion and distrust.

In early July, President Bush nominated career diplomat Gene Cretz to be the first American envoy to Libya since 1972. Cretz, currently deputy chief of mission at the U.S. Embassy in Tel Aviv, has also held key posts at U.S. missions in Egypt and Syria.

But four Democratic senators New Jersey's Frank Lautenberg and Robert Menendez and New York's Charles Schumer and Hillary Clinton say they intend to block Cretz's nomination until Libya pays compensation for terrorist attacks in the 1980s.

Libya was held responsible for the bombing of Pan Am Flight 103 over Lockerbie, Scotland, in 1988. It later agreed to pay $2.7 billion $10,000 for each of the 270 people who died in that mid-air explosion as reparations to the victims' families.

The four Democrats want the Bush administration to pressure Libya to also compensate the families of two U.S. servicemen killed in a 1986 Berlin disco bombing.

That's the wrong approach, says the USLBA's executive director, David Goldwyn.

"If you want to talk to Libya about its role in the neighborhood and its role in counterterrorism, you must have normal diplomatic relations just to have the conversation. What we have now is trade and investment that functions largely independent of diplomacy," he told the Diplomat in a recent interview.

"Secretary of State Rice has not been to Libya, but she's been to Khartoum, and Sudan is still on the terrorist list," he complained. "Part of Libya's unhappiness is that there doesn't even exist the trappings of a minimally normal relationship."

The USLBA, a Section 501(c)(6) trade association, says its objective is three-fold: to promote the development of commercial law in Libya so that U.S. companies can do business there; to "educate" the U.S. government and the public about Libya's new approach to the world, and to overcome "serious obstacles" to the bilateral relationshp.

More specifically, the USLBA aims to speed up the issuance of visas in both directions and remove the foreign-assistance ban which is still being enforced against Libya, despite the fact that Rice formally restored full diplomatic relations on May 15, 2006.

"Our focus has really been to promote a strong bilateral relationship between the U.S. and Libya, so that all of the infrastructure for international travel and business can be in place," he said. "And our first priority was to have a full ambassador appointed to Libya."

Senate hearings on the Cretz nomination are set for this month [September], which if successful could lead to the Stars and Stripes fluttering atop an embassy somewhere in Tripoli in the near future.

But one thing is for sure: it won't be located in the same embassy the United States used up until 1980, when Washington and Tripoli broke diplomatic relations.

"The old U.S. Embassy building is completely decrepit and inhabited by squatters," according to Goldwyn. "Also, since then, U.S. security regulations have changed. For example, all diplomatic buildings must be set back from the street. There's talk about building an embassy. The U.S. has worked with the Libyans to identify a property, and they're now trying to obtain clear land title to it. That's not an easy issue in Libya."

Right now, said Goldwyn, the U.S. Embassy is operating out of the Corinthian Hotel in Tripoli, "and because they're in a hotel, they have no ability to issue visas. So any Libyan businessman who wants to come here has to go to Tunis for an interview, and then back to Tunis a second time to pick up the visa."

As a result, he said, "the Libyan government is upset that the U.S. is taking so long to set up a facility for issuing visas in Libya. So they are reciprocating by slowing down the number of visas they're willing to issue Americans. The embassy here has been wonderful about trying to facilitate visas for U.S. businessmen going to Libya, but there's definitely a go-slow policy emanating from Tripoli."

Goldwyn, a longtime Washington-based foreign affairs and energy expert, served during the Clinton administration as assistant secretary of energy for international affairs as well as national security deputy to Bill Richardson, when Richardson was U.S. ambassador to the United Nations.

The USLBA now has 15 corporate members paying a minimum $10,000 a year. These include AIG, Boeing, Booz Allen Hamilton, BP, Chevron, ConocoPhillips, Dow Chemical, ExxonMobil, Fluor, Hess, Marathon Oil, Motorola, Occidental Petroleum, Shell, Valmont and White & Case.

In December, Goldwyn traveled to Libya for the first time, along with eight American executives.

"We had a fantastically warm reception. We saw the minister of foreign affairs, the minister of planning, the head of the National Planning Council, head of the Housing and Infrastructure Commission," he said. "They were happy to see us back, and very positive. Remarkably, there's no sense of anti-Americanism."

Goldwyn said Libay's first-tier priority is infrastructure, and that the government plans to spend $25 billion this year alone on roads, bridges, water infrastructure and electricity.

"They'll be doing this in all major and minor Libyan cities, and they've set up a special-purpose Housing and Infrastructure Authority to oversee the international tenders," he said. "There's a lot of construction going on in Tripoli, but the rest of the country seems to have tremendous potential that's yet to be developed. What we learned from the Libyans is they're still developing their strategy on tourism. They're not looking for spring-break tourists."

Goldwyn says Libya's decision in late July to release five Bulgarian nurses and one Palestinian doctor accused of intentionally infecting children with HIV was "significant" and positive. "It alone will not be a breakthrough for Libyan relations. Resolution of the disco bombing is really the primary issue," he said.

Because Libya was so insular for so many years, says Goldwyn, most Americans tend to have a caricature of the country being a one-man state run by Moammar Qaddafi.

"That's a huge misconception," he said. "In fact it's a multicultural, multi-tribal state with a number of factions. It's a consensus-driven system which makes for incredibly slow decisions."

He added that "opening to privatization, allowing tourism and letting Libyans travel outside the country are all good things, if they actually happen. So we spend a good part of our time talking to Libyan officials and how to get there and why they should get there and about how they are perceived in the United States."

Likewise, he said, "when we talk to Congress about not barring funds for an embassy in Tripoli, our rationale is that the only way to deal with these issues is to have a robust diplomatic relationship with Libya. The bottom line is that you don't make peace with your friends, but with your enemies. And you have to be willing to take 'yes' for an answer when you ask countries to change."

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