Unity govt under pressure on security, economic reforms

A month of deadly clashes between armed groups in Tripoli has stepped up pressure on Libyas unity government to end its reliance on militias and to implement economic reforms.

UN envoy Ghassan Salame stressed this week as a ceasefire came into effect that "security cannot remain in the grips of the armed groups but must be in the hands of the state".

"It was the first time that the pro-GNA militias have been described (by the UN) as undesirable and need dismantling," said Jalel Harchaoui, a specialist on Libya at Paris 8 University, referring to the internationally-recognised Government of National Accord.

The GNA was set up under a UN-brokered agreement signed in Morocco in December 2015 that raised hopes of an easing of the chaos that followed the 2011 NATO-backed revolution which ousted Libyan dictator Moamer Kadhafi.

But a rival administration based in the country's east and supported by military strongman Khalifa Haftar refuses to recognise the GNA's authority.

Tripoli itself has been at the centre of a battle for influence between armed groups with shifting allegiances, leaving the GNA dependent on the support of militias for its security and that of the capital.

In exchange for their military support, armed groups in the capital have infiltrated both political and military institutions in Tripoli.

After the latest clashes, calm returned to Tripoli on Tuesday following a battle using heavy weapons that killed at least 117 people and injured more than 400 others, according to official figures.

GNA relies on them

At the end of August, militias from western Libya entered the capital, sparking the showdown with local groups.

Under the ceasefire terms, the GNA has committed itself to sever links between state institutions and armed groups.

That is a tall order.

"These groups were intelligent enough to penetrate the capital's police and economic institutions... The GNA works with them, depends on them, relies on them," said Harchaoui.

The GNA has set itself the target of eliminating "dysfunctions" in the economy and banking sector that are exploited by militias as sources of enrichment.

The main aims are to narrow the gap between the official foreign currency exchange rate and the market rate, and to lift state subsidies on fuel in the oil-rich country that open the door to traffickers.

Corruption

At the official rate, the US dollar trades at 1.4 Libyan dinars, but because of Libya's cash-starved banking sector, the black market rate is four or five times higher.

The wide discrepancy encourages corruption.

Armed groups with access to dollars at the official rate can make huge profits by then selling the hard currency on the black market.

In a move which amounts to a devaluation, the unity government has imposed a 183 percent "tax" on the sale of foreign currencies.

As a result, the dollar, when it is available in banks, is sold at the official rate of 3.9 dinars.

But Kamal al-Mansouri, a Libyan economy expert, said the impact would be limited so long as the GNA and the eastern authority each run their own central bank.

All parallel authorities must be abolished, he said.

Ismail al-Sherif, a deputy in Libya's elected parliament based in the east, said that for economic measures to take effect they would have to be accompanied by political and security reforms.

"There'll be no success at the economic level so long as tensions persist and if weapons remain in the hands of armed factions," he said.

Sherif said the way forward was a "restructuring" of the GNA, a delicate process of UN-brokered negotiations between the GNA and its rivals in eastern Libya.