Monday, 20 May 2013

For full article, please visit: http://www.geopoliticalmonitor.com/division-or-attraction-an-overview-of-libyas-future-after-gaddafi-4813/

Division or Attraction: An Overview of Libya’s Future after Gaddafi
By: Nicolai Due-Gundersen
May 20th, 2013

Libya is a country located in Northern Africa that borders the Mediterranean Sea. Until the 1950s, it was regarded as another poor African state, but the discovery of oil greatly increased its wealth, turning it into one of the richest African countries and also increasing its significance in the eyes of Western Powers. Emerging from the colonial era, Libya struggled with independence and experienced almost two decades of fragile stability as the United Kingdom of Libya from 1951-1969.  However, the September 1st Revolution of 1969 saw Colonel Muammar Gaddafi seize power in a bloodless coup d’état. Gaddafi’s Libya lasted over 40 years, though recent events have seen the dictator ousted and the ascendance of the National Transitional Council (NTC).

Although the NTC has promised to appoint cabinet ministers and allow democratic elections, uncertainty over Libya’s future remains, spread across the interests of external actors such as Europe and NATO and also internal conflicts between the NTC and Islamist militants whom have helped resist Gaddafi loyalists.  Further, to understand potential outcomes of Libyan politics, it is necessary to analyze historical centers of power and importance, such as Tripolitania and Cyrenaica, along with the geopolitical factors of bordering states and of course the distribution of natural resources. Such factors may determine if Libya eventually splits into two politically autonomous territories; namely, Tripolitania and Cyrenaica.

A Brief History and the Geography of Libya

Libya’s tribal system has been an enduring feature of its culture of resisting imperial influence. Throughout Libya’s history, Libyans saw their own people as authority figures. Tribal families and heads were regarded as the country’s elite. Rather than believing in a nation state, the tribal system categorized Libya into local governments, headed by tribal leaders. Such leaders, in turn, would exercise their own patronage system to maintain and exert influence (which was of greater importance after the discovery of oil). The local and familial aspects of the tribal system, by their very nature, did not include a sense of national unity. The primacy of tribal belief thus mitigated certain effects of imperialism. While Italy attempted to disrupt and divide the tribal system, they were not very successful. Europeanization was resisted, and Libyan elites who worked with Italian masters retained cultural links with their fellow Libyans. Italian colonial rule ended in 1911, and Arab Muslim culture reemerged rapidly in full strength. Nonetheless, Gaddafi himself disliked tribal roots, viewing such a system as antiquated and an obstacle to modernization. Hence, tribal boundaries were worked into new zones that attempted to weaken tribal links and local patronage systems in order to prioritize a more modern belief of (political) competence through education of the elites. Government attempts to abolish the tribal system were, however, resisted. Ultimately, Gaddafi was forced to maintain his power through the manipulation of tribal allegiances, all the more significant because of the small size of Gaddafi’s own Gaddafa tribe.

Gaddafi’s patronage network was structured around both security and the nation’s resources. Given his own tribe’s small size, Gaddafi had to compensate and thus used members of Libya’s largest tribe, the Warfalla, as security personnel. In addition, the Zuwayya tribe in the oil-rich South would have had to be placated in various ways (i.e. through being granted a privileged status in Gaddafi’s patronage system) due to their proximity to resources. This importance became clearer during anti-Gaddafi protests, when Zuwayya members threatened to withhold oil supply due to Gaddafi’s violence against protestors. In addition, Gaddafi’s treatment of protestors also cost him support of the Warfallas, a major security loss.

Geographically speaking, Libya has three regions of significance to both political and agricultural stability. Tripolitania and Cyrenaica have historically been political rivals. Both partnered with Axis and Allied powers respectively during the Second World War. In addition, tension increased considerably post-independence when Western powers supported the installation of King Emir Sayid Idris, a Cyrenaican, causing much bitterness in Tripolitania. When Gaddafi seized power in 1969, feelings of bitterness and joy were reversed. Mutual hostility has thus prevented a sense of national unity, further enforced by the geographical layout of the Gulf of Sirte, which creates physical distance between the two regions, symbolizing their mutual callousness and feelings of being more Tripolitanian or Cyrenaican than united Libyans. Finally, the region of Fezzan holds some importance for its pastoral culture (and thus minor agricultural capabilities).

However, Fezzan’s agrarianism is not enough to feed Libya’s population. As one critic explains, most of Libya is composed of arid land, which cannot sustain plant life or the growth of crops. The coast is the only area with less dryness. However, waves from the Mediterranean Sea frequently deposit salt on the coast, killing plant life and preventing the possibility of agriculture. Consequently, Libya is forced to import food, and it is therefore vital that the production of their resources resume forthwith. It is likely that for long-term economic growth, resumption of resource production will not be enough. As resources such as oil and gas must be exported, political stability will be needed to convince foreign companies to invest in the Libyan market.

Resources

With the discovery of oil in 1959, Libya became one of the wealthiest African states. Having been privy to Axis/Allied politics during the Second World War, the discovery of oil piqued Western interest in Libya more than ever, and Libya became another playing field for war games between the US and USSR. The Sirte Basin provides 80% of Libya’s oil output. With the largest proven oil reserves in Africa, oil is a major export good and source of income, with up to 1.5 million barrels exported on a daily basis. In addition, many critics argue that Libya remains underexplored, meaning that there is a potential for greater oil wealth. Further, Libyan oil often contains low sulfur traces, important to oil companies and exporters wishing to comply with stringent sulfur emission laws in Europe, Libya’s largest market. However, Libya’s biggest export is also significant in the domestic energy market, with oil dependence as high as 72%. Naturally, Libya must free up more oil for exportation in order to maximize state profits. Hence, the country is attempting to expand its use of gas (currently representing 28% of total domestic energy consumption) and is also experimenting with solar power in rural areas to reduce oil use. A balance between controlling the price of oil and domestic profits and maintaining positive relations with international oil companies has characterized Libya’s approach in the past.

As recently as 2005, however, the Libyan government changed the conditions of partnerships with international oil companies, limiting the profits such companies will receive. Previously, oil companies had enjoyed profit shares of up to 49%. Under the 2005 changes, this share has been reduced by up to half, and in some cases, oil companies are only granted an extension of their license to explore and profit from Libyan oil if they commit to further financial investment into the Libyan oil sector. This shift in attitudes from prioritizing positive relations with international oil companies to reducing their profits so as to increase state shares reveals how Libya now considers itself a well-established oil state (thus granting it greater control over its share of oil profits). Furthermore, the demands of reinvestment made on foreign oil companies illustrates how Libya both recognizes the importance of exportation as an almost sole source of profit and the potential for increased oil wealth through further exploration. Indeed, the latter likely explains why the state’s National Oil Company expects oil exploration to be undertaken by all oil companies operating in Libya.

Libya’s secondary natural resource is gas, which is becoming a significant good for both exportation and domestic energy consumption. As of 2011, Libya’s proven gas reserves were estimated at 54.7 trillion cubic feet. Though the second-lowest figure when compared to the rest of Africa, it is estimated that further exploration will see it rise considerably. Given Libya’s wish to decrease oil dependence, it is no surprise that gas production has steadily increased. By 2011, gas accounted for almost half of electricity production. While this figure does show an attempt to reduce oil dependence, gas use is still split between electricity generation and the use of gas to enhance oil recovery. Naturally, this split illustrates the difficult balance between reducing oil dependence through gas consumption and increasing oil production to increase oil exports. The difficulty of this balance, together with frequent project delays (exacerbated by Gaddafi’s downfall and subsequent turmoil) has limited the utility of gas and will likely continue to do so until the Libyan state is stable enough to focus on long-term state building and maximizing gas production through prompt project startups, both for domestic gas consumption and for increasing oil recovery and thus oil exportation.

For full article, please visit: http://www.geopoliticalmonitor.com/division-or-attraction-an-overview-of-libyas-future-after-gaddafi-4813/

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