Friday, 25 March 2011

Britain plans for regime change in Libya

The Daily Star
Friday, March 25 2011
By Michael Glackin

After a series of embarrassing fumbles, the British government appears to have finally come to grips with how to deal with Libyan leader Moammar Gadhafi. Or has it?

When it comes to Libya, Prime Minister David Cameron has been guilty of more flip flops than an Olympic gymnast. Still, his role in the United Nations’ decision to protect innocent civilians should be welcomed. Unfortunately, while the West sat on its hands for a month, Gadhafi launched a vicious rearguard action against the myriad forces opposed to his regime, leaving thousands dead and allowing him reassert control over the west of the country.

The problem now that the West has finally taken action is to determine what happens next. A Foreign Office official told me that the British government’s objective in opposing Gadhafi is to ensure that there is “a unified Libya under a central government that is more open and democratic, not run by Gadhafi, which does not pose external threats either in the region or more broadly.”

This is a huge change from Cameron’s earlier statements – not to mention the United Nation mandate which does not mention regime change. Increasingly, the statements from the government are starting to resemble former Prime Minister Tony Blair’s ever shifting objectives in Iraq. The Foreign Office official declined to explain how Gadhafi would be deposed, but British policy, and with it that of French President Nicolas Sarkozy and the United States President Barack Obama, still appears to be tied in to three doubtful outcomes.

First, the hope that coalition air attacks on Gadhafi’s military machine, which have successfully grounded Libya’s air force and destroyed its air defenses, will push the Libyan leader’s armed forces to desert him to the extent that his regime implodes.

Second, and much more unlikely, is the hope the bombing has done enough damage to enable the rebels in the east to mount their own counterattack against Gadhafi’s forces. Unfortunately the rebels holed up in Benghazi are a ragtag bunch and extremely unlikely to topple the regime on their own. According to defense analyst Anthony Cordesman, from the Washington-based Center for Strategic and International Studies, the rebels are “divided, lack discipline and structure and are both poorly supplied and untrained in using advanced weapons.” It is unlikely that the West will send these people arms and the American-European coalition does not want to be transformed into the aerial arm of the rebellion.

The third outcome is what politicians like to call “decapitating” the regime, or more simply killing Gadhafi. The United Kingdom’s chief of the defense staff, Sir David Richards, was slapped down by the government for insisting that assassination was not an option after coalition planes dropped a bomb on Gadhafi’s private compound last weekend, in what looked like an obvious attempt to kill him.

All three options are weak platforms to support the view that military action will be short and accelerate Gadhafi’s demise. In fact, far from Gadhafi’s regime collapsing, it is actually the coalition that is now showing distinct signs of breaking apart.

Partly, that’s because several key questions remain unanswered. It is unclear who would take over were Gadhafi to be overthrown or killed. Readers of American diplomatic cables leaked by WikiLeaks will also be aware of concerns within the U.S. government that eastern Libya is a hotbed of Islamic extremism. Any new Libyan government is likely to require a good deal of support from the West, and it is against this backdrop that many in the U.K. are firmly opposed to the current intervention, and to further involvement in Libya.

Media reports that firing a single U.K. Tomahawk missile costs around $1.4 million, at a time when Gulf Arab countries are filling their coffers on the back of sky-high oil prices, sits equally badly with many in the British public. That is particularly the case when at least three of the Gulf states – Bahrain, Saudi Arabia and Yemen (not to mention Syria) – are using force to crush pro-democracy movements.

Hardly helping matters is that Washington has been looking for the Libyan exit since the first coalition airplane took off. Barack Obama’s interest in foreign affairs seems limited to finding destinations for state visits with his photogenic wife. This poses a problem for Sarkozy and Cameron. Despite France being the first in the air last week, around half of the missions currently being conducted over Libya are being carried out by American pilots and, so far, all combat operations have taken place under American command.

Moreover, while Sarkozy and Cameron are united in support of military action, the European Union is not. The EU’s foreign affairs chief, the hapless Baroness Ashton, sided with Germany in opposing the imposition of a no-fly zone over Libya. Then there’s the unconcealed opposition of key NATO member Turkey to both the no-fly zone and to any further military action.

As things currently stand, it seems inevitable that the coalition will have to put boots on the ground at some point. The promise implicit in U.N. Security Council Resolution 1973 that there will be “no occupation force” does not necessarily rule out a temporary deployment of troops. Whether this is done through the dispatching of Arab troops remains to be seen. Bearing in mind that Qatar is the only Arab state that has committed any active military support to the current operation – four warplanes – it is more likely that the West will have to act alone, raising the specter of the bloody occupation of Iraq.

The coalition has saved Benghazi, but if Gadhafi survives this will create a stalemate, as it did in Iraq after 1991. At the time, Saddam Hussein’s regime survived while Iraqis continued to suffer. To believe that “intervention lite,” in the shape of a no-fly zone, can successfully safeguard Libyan civilians ignores recent history and Resolution 1973 itself. Obama, Cameron and Sarkozy have encouraged Libyans to stand up against Gadhafi’s repression and it would immoral to leave him in place to harm his people as the west abandoned Shiite rebels to their fate in Iraq. Anything less than Gadhafi’s departure prolongs the agony of those whom the coalition insists it is protecting.

Rarely has the West more clearly exposed itself to charges of hypocrisy in its policy and dealings in the Arab world than in its cozying up to Gadhafi in recent years. But now, it has no other option than to see what it has started through to its logical conclusion.
Michael Glackin is former Managing Editor of Beirut based newspaper The Daily Star.

Tuesday, 1 March 2011

The U.K. vacillates on Mubarak money

The Daily Star
Tuesday, March 1 2011
By Michael Glackin

Fresh from savoring post-Hosni Mubarak Egypt first hand, the British prime minister, David Cameron, offered the Arab world a mea culpa for what he called the United Kingdom’s “double standards” in supporting autocratic governments in the region.

Cameron lamented that past governments “faced a false choice” between British interests and values. The U.K.’s interests, he said, will now lie in “upholding our values, in insisting on the right to peaceful protest, in freedom of speech and the Internet, in freedom of assembly and the rule of law.”

Unfortunately, while the prime minister was impersonating a statesman, he was also busy being a salesman. He touted the virtues of British defense companies – whose executives accompanied him across the Middle East – even as equipment and arms sold to Moammar Gadhafi by the U.K. were being used to murder peaceful protesters attempting to assemble freely in Libya.

So it was probably just as well that Cameron inserted a few of his own double standards into his speech. For while stressing democratic values, he also insisted that he respected the right of leaders to manage reform at their own pace.

This double standard is essential. For the following day Cameron was in Qatar – a country with no political parties and where the last election was held more than 40 years ago – presiding over the signing of a $3 billion gas supply deal between Qatar and the British group Centrica. The Qataris also sounded Cameron out about the possibility of investing in government-owned British banks.

What passes for Qatar’s political system is a long way short of what Cameron is enthusiastically calling for in Egypt. Qatar is not Libya of course, but then again neither, despite its many appalling aspects, was Mubarak’s Egypt. The simple difference is that the Qatari royal family’s relatively benign autocracy retains a much firmer grip on power than Mubarak could manage after 30 years. The great 19th-century statesman Lord Palmerston famously said that Britain has no permanent allies, only permanent interests. That remains the hallmark of Cameron’s policy. Values are measured in hard cash.

In fact every aspect of the British government’s current reaction to events in the Middle East is riddled with double standards. Take the cash piles dotted around the globe by the Mubarak family and the Gadhafi government. Witness the speed with which the U.K. and the European Union reached agreement to freeze the assets of ousted Tunisian President Zine al-Abedine Ben Ali and his cronies. France has confirmed receiving an Egyptian request for similar action against Mubarak family assets. The U.K. has also received an Egyptian request, but will not  confirm which assets Cairo wants frozen. It matters little since neither Paris nor London has acted on the requests, even though the Washington-based Global Financial Integrity estimates that around $57 billion in illicit assets left Egypt between 2000 and 2008.

Bizarrely, Switzerland, banker to many a despot in the past, moved with commendable speed to freeze the assets of President Hosni Mubarak, his family, and his former ministers. The Swiss will now assess whether the money came from illicit activity.

Mubarak has close ties to London’s financial community through his son Gamal. Gamal owns half of Cyprus-based Bullion Company, which owns London-based investment fund Medinvest Associates, which Gamal helped set up in 1996 before leaving in 2001. Medinvest, Egypt’s first private equity fund, invested in Egyptian companies and public-sector organizations during the large scale privatization of the Egyptian economy undertaken by Mubarak in the 1990s. Gamal also has an 18 percent stake in EFG Private Equity, a subsidiary of London listed Egyptian investment bank EFG-Hermes.

But rather than act unilaterally and freeze these assets as the Swiss have, the British government is keen to secure agreement with the European Union. Why? Insiders at the U.K.’s Serious Fraud Office and Serious Organized Crime Agency, which investigate financial crime, say they have made inquiries and can act quickly if the go-ahead comes from the politicians. But for the U.K. to act alone requires proof of wrongdoing. Unlike Switzerland, the U.K. is not prepared to freeze first and ask questions later. In contrast, an EU decision to freeze the assets requires no such proof, merely agreement among European leaders.

Government officials insist that this is the speedy route. However, there may be another reason why the U.K. wants to pass the hot potato to the EU. Egypt has also asked that the assets of Ahmed Ezz, an Egyptian politician and owner of London-listed Ezz Steel, Egypt’s biggest steel company, be frozen. The main charge against Ezz, who insists he is innocent, is that he took control of a state-owned steel company illegally during the privatization program thanks to his links with Mubarak’s regime.

A similar charge could be leveled at some very rich Russians currently residing in London – the so-called oligarchs. Their fabulous wealth, speedily acquired and taken West during the chaotic privatization of Russia’s heavy industries during the country’s transition to a market economy, is largely attributable to connections to corrupt politicians. And it may explain why the U.K. is so reluctant to start freezing assets on that basis, when it is allowing billionaire Russians to enjoy the fruits of what many would argue are similarly ill-gotten gains. Far better to wait for the EU to act, allowing the U.K. to avoid setting what would be an awkward precedent.

Meanwhile, Libya’s cash is even easier to trace than Egypt’s. Moammar Gadhafi’s investment vehicle for Libya’s oil money, the Libyan Investment Authority, has stakes in commercial property across London. It is also the fifth largest shareholder in Pearson, which owns Penguin Books and publishes The Financial Times.

It seems bizarre to expect the U.K. to be capable of coordinating an international no-fly zone over Libya or sanctions on the country, or to take any action to stop the bloodshed, when it can’t even implement a standard financial transaction without passing the buck to the EU. Standards, even double standards, clearly aren’t what they used to be.