There has been a stark contrast between messaging coming from the international community and trends on the ground as Libya’s latest bout of civil war enters its eighth month.

Led by Germany, some states have been trying to build consensus for a ceasefire ahead of a summit that is expected to be held in Berlin in the next few months. Today marks the date of one of the final planning meetings for the summit.

The increasing use of drone technology, airstrikes and further influxes of fighters trend points in the opposite direction. Warring groups in Libya continue to receive support from external states, undermining international efforts to de-escalate the conflict. A UN arms embargo goes largely unenforced. As the Berlin process unfolds, there is little evidence to suggest that these external states will shift their positions.

The launch of Field Marshal Khalifa Haftar’s Libyan Arab Armed Forces (LAAF) offensive on Tripoli in April sunk a UN-planned ‘national conference’, intended to be held less than two weeks later, to negotiate a framework for transition out of Libya’s governance crisis. Yet, Haftar has so far failed in his objective of capturing Tripoli. While his offensive continues, had he the capacity to capture the city, he would have done so already.

This has created a conundrum for peace talks: there appears to be little chance of negotiating a deal with Haftar, while it is also hard to see how a deal could be reached without him.

The field marshal has little interest in accepting a withdrawal, even a partial one, of his forces. His opponents – who have found unity in their shared efforts to defeat Haftar’s forces – will not accept a ceasefire that leaves the LAAF on the hinterlands of the capital. Similarly, a deal apparently agreed in Abu Dhabi between Haftar and Prime Minister Fayez al-Serraj in February is also dead in the water.

Amid this logjam, there has been an increasing interest in the economic content of the Berlin summit. Countries supportive of Haftar argue that his alliance has legitimate concerns over the management of Libya’s economy and, particularly, the dominant role of the Tripoli-based central bank and its governor in supporting armed groups.

For some within these countries, changing the leadership of the central bank and a finding means of limiting the dominance of the UN-backed Government of National Accord (GNA) over the state’s resources – thus reducing flows of funding to armed groups fighting Haftar – could present a point of agreement in Berlin.

But their focus on financial management in Tripoli is not mirrored by interest in holding the rival central bank in the eastern city of Bayda – an institution unrecognized by the international community – to account for its pursuit of its own monetary policy. This is built on approximately $23 billion of unsecured debt from commercial banks and $11 billion of currency supplied by Russia.

Indeed, very few of the conversations surrounding parameters for Berlin contain details of what would be asked of eastern-based actors beyond pursuit of an audit of the Tripoli and Bayda central banks (only the Tripoli bank is recognized by the international community).

Clearly, the GNA and its allies would have no incentive to accept provisions that limit their means to mobilize resources for the war while its opponents do not receive the same scrutiny. 

However, it is possible to capitalize on the broad interest in economic content to reach some points of agreement over the management of the economy and state institutions. Rather than seeking to replace individuals aligned with one faction for those aligned with another, or expecting asymmetrical concessions from the GNA and its allies, this effort must instead focus on structures and processes that exacerbate the conflict and represent major grievances for the warring parties.

Importantly, this would include the establishment of a system of transparency and accountability for the management of Libya’s finances.  The opacity of current processes enables the support of patronage-based networks with no effective oversight.

Linked to this, the development of effective processes for budgeting and allocating funds could help to reduce graft.

And, finally, rationalizing the role of state institutions to agree their roles and responsibilities, creating the room for reforms to Libya’s system of state employment and subsidies through provision of direct payments to Libyan citizens, is essential.  

An economic commission that comprises members from across political and institutional divides – receiving political support from international powers and technical support from international financial institutions – could be an effective approach. Such a commission could match an inclusive, Libyan-led process with international support to progressively harmonize economic and financial policy between rival authorities and develop consensus for a process of institutional reunification in Libya.

This would constitute a major element of an eventual political settlement and reduce the risk of a limited set of actors capturing the system at the expense of the others – an outcome which would likely result in future bouts of violence.

Such a commission would offer a means of addressing a key driver of the conflict by decentralizing aspects of Libya’s governance, moving away from the dominance of Tripoli and the current winner-take-all system. 

These issues cannot be put to one side, to follow progress on the security front. The remarkable resilience that Libya’s economy has shown over the last seven months should not be taken for granted. It has become increasingly difficult for Libya’s institutions to insulate themselves from the conflict as both sides seek to mobilize resources to sustain their war effort.

The LAAF is increasingly looking to sideline civilian authorities in eastern Libya. On the other side, the GNA has found means of routing funds to armed groups fighting Haftar.

In September, a dispute over the supply of jet fuel between the LAAF and the National Oil Corporation resulted in the establishment of a parallel Brega Petroleum Marketing Company, the state-owned company that possesses a monopoly over fuel distribution.

Meanwhile, other major problems lurk under the surface.  The banking sector is in an increasingly perilous state and debts continue to mount all around, with those in the east not accounted for by Tripoli’s official authorities.  

Through the establishment of an economic commission, the Berlin process provides an opportunity and – most importantly – a mechanism to address these problems while also helping to maintain the basic functionality of the state.  Even if a ceasefire deal does not materialize, initiating negotiations about the future shape of the state and its economy would be a significant step forward.

A shaky truce remains broadly in place among rival Libyan forces fighting for control of Tripoli. However, a durable ceasefire to bring an end to the current bout of conflict, which was initiated by Khalifa Haftar’s Libyan Arab Armed Forces’ (LAAF) offensive on the capital in April 2019, has not been reached. In recent weeks attention has focused on talks hosted in Moscow and Berlin, with the former aimed at agreeing a ceasefire and the latter seeking to reach agreement among international actors to bring an end to external military support for Libyan warring actors, and to craft a way forward for future intra-Libyan talks. Yet, there has been little emphasis on Libyan actors – beyond Haftar and prime minister Fayez al-Serraj – in this process.
 
This roundtable will bring together experts and policymakers to discuss means of de-escalating the conflict and seeking a lasting resolution through the development of interconnected intra-Libyan social and security negotiation tracks. Mr Usama Otman Essed of the Libya Center for Strategic and Future Studies (LCSFS) will present his research group’s ideas on these issues and discuss their ongoing efforts to promote dialogue among social and security actors.

Attendance at this event is by invitation only. 

There is a broad consensus that Libya’s rentier, patronage-based system of governance is a driver, and not only a symptom, of Libya’s continuing conflict. The dysfunction of Libya’s economic system of governance has been exacerbated by the governance split that has prevailed since 2014 whereby rival administrations of state institutions have emerged. Despite these challenges, a system of economic interdependence, whereby forces aligned with Field Marshal Haftar control much of the oil and gas infrastructure and the UN-backed Government of National Accord controls the means of financial distribution, has largely prevailed. Yet, at the time of writing, this is under threat: a damaging oil blockade is being implemented by forces aligned with Haftar and those state institutions that do function on a national basis are finding it increasingly difficult to avoid being dragged into the conflict.

This roundtable will bring together analysts and policymakers to discuss these dynamics and look at possible remedies. Jason Pack, non-resident fellow at the Middle East Institute, will present the findings of his latest paper on the issue which recommends the formation of 'a Libyan-requested and Libyan-led International Financial Commission vested with the requisite authorities to completely restructure the economy.' Tim Eaton, who has been leading Chatham House’s work on Libya’s conflict economy, supporting UNSMIL’s efforts in this field, will act as respondent.

Attendance at this event is by invitation only. 

Since the overthrow of the regime of Muammar Gaddafi in 2011, Libya’s multitude of armed groups have followed a range of paths. While many of these have gradually demobilized, others have remained active, and others have expanded their influence. In the west and south of the country,  armed groups have used their state affiliation to co-opt the state and professionals from the state security apparatus into their ranks.

In the east, the Libyan Arab Armed Forces projects a nationalist narrative yet is ultimately subservient to its leader, Field Marshal Khalifa Haftar. Prevailing policy narratives presuppose that the interests of armed actors are distinct from those of the communities they claim to represent. Given the degree to which most armed groups are embedded in local society, however, successful engagement will need to address the fears, grievances and desires of the surrounding communities, even while the development of armed groups’ capacities dilutes their accountability to those communities.

This roundtable will discuss the findings of a forthcoming Chatham House research paper, ‘The Development of Libyan Armed Groups Since 2014: Community Dynamics and Economic Interests’, which presents insights from over 200 interviews of armed actors and members of local communities and posits how international policymakers might seek to curtail the continued expansion of the conflict economy.

PLEASE NOTE THIS EVENT IS POSTPONED UNTIL FURTHER NOTICE.

Summary

• Libya’s multitude of armed groups have followed a range of paths since the emergence of a national governance split in 2014. Many have gradually demobilized, others have remained active, and others have expanded their influence. However, the evolution of the Libyan security sector in this period remains relatively understudied. Prior to 2011, Libya’s internal sovereignty – including the monopoly on force and sole agency in international relations – had been personally vested in the figure of Muammar Gaddafi. After his death, these elements of sovereignty reverted to local communities, which created armed organizations to fill that central gap. National military and intelligence institutions that were intended to protect the Libyan state have remained weak, with their coherence undermined further by the post-2014 governance crisis and ongoing conflict. As a result, the most effective armed groups have remained localized in nature; the exception is the Libyan Arab Armed Forces (LAAF), which has combined and amalgamated locally legitimate forces under a central command.
• In the west and south of the country, the result of these trends resembles a kind of inversion of security sector reform (SSR) and disarmament, demobilization and reintegration (DDR): the armed groups have used their state affiliation to co-opt the state and professionals from the state security apparatus into their ranks; and have continued to arm, mobilize and integrate themselves into the state’s security apparatus without becoming subservient to it. In the eastern region, the LAAF projects a nationalist narrative yet is ultimately subservient to its leader, Field Marshal Khalifa Haftar. The LAAF has co-opted social organizations to dominate political and economic decision-making.
• The LAAF has established a monopoly over the control of heavy weapons and the flow of arms in eastern Libya, and has built alliances with armed groups in the east. Armed groups in the south have been persuaded to join the LAAF’s newly established command structure. The LAAF’s offensive on the capital, which started in April 2019, represents a serious challenge to armed groups aligned with the Tripoli-based Government of National Accord (GNA). The fallout from the war will be a challenge to the GNA or any future government, as groups taking part in the war will expect to be rewarded. SSR is thus crucial in the short term: if the GNA offers financial and technical expertise and resources, plus legal cover, to armed groups under its leadership, it will increase the incentive for armed groups to be receptive to its plans for reform.
• Prevailing policy narratives presuppose that the interests of armed actors are distinct from those of the communities they claim to represent. Given the degree to which most armed groups are embedded in local society, however, successful engagement will necessarily rely on addressing the fears, grievances and desires of the surrounding communities. Yet the development of armed groups’ capacities, along with their increasing access to autonomous means of generating revenue, has steadily diluted their accountability to local communities. This process is likely to be accelerated by the ongoing violence around Tripoli.
• Communities’ relationship to armed groups varies across different areas of the country, reflecting the social, political, economic and security environment:
• Despite their clear preference for a more formal, state-controlled security sector, Tripoli’s residents broadly accept the need for    the presence of armed groups to provide security. The known engagement of the capital’s four main armed groups in criminal activity is a trade-off that many residents seem able to tolerate, providing that overt violence remains low. Nonetheless, there is a widespread view that the greed of Tripoli’s armed groups has played a role in stoking the current conflict.
• In the east, many residents appear to accept (or even welcome) the LAAF’s expansion beyond the security realm, provided that it undertakes these roles effectively. That said, such is the extent of LAAF control that opposition to the alliance comes at a high price.
• In the south, armed groups draw heavily on social legitimacy, acting as guardians of tribal zones of influence and defenders of their respective communities against outside threats, while also at times stoking local conflicts. Social protections continue to hold sway, meaning that accountability within communities is also limited.
• To varying extents since 2014, Libya’s armed groups have developed networks that enmesh political and business stakeholders in revenue-generation models:
• Armed groups in Tripoli have compensated for reduced financial receipts from state budgets by cultivating unofficial and illicit sources of income. They have also focused on infiltrating state institutions to ensure access to state budgets and contracts dispersed in the capital.
• In the east of the country, the LAAF has developed a long-term strategy to dominate the security, political and economic spheres through the establishment of a quasi-legal basis for receiving funds from Libya’s rival state authorities. It has supplemented this with extensive intervention in the private sector. External patronage supports military operations, but also helps to keep this financial system, based on unsecured debt, afloat.
• In the south, limited access to funds from the central state has spurred armed groups to become actively involved in the economy. This has translated into the taxation of movement and the imposition of protection fees, particularly on informal (and often illicit) activity.
• Without real commitment from international policymakers to enforcing the arms embargo and protecting the economy from being weaponized, Libya will be consigned to sustained conflict, further fragmentation and potential economic collapse. Given the likely absence of a political settlement in the short term, international policymakers should seek to curtail the continued expansion of the conflict economy by reducing armed groups’ engagement in economic life.
• In order to reduce illicit activities, international policymakers should develop their capacity to identify and target chokepoints along illicit supply chains, with a focus on restraining activities and actors in closest proximity to violence. Targeted sanctions against rent maximizers (both armed and unarmed) is likely to be the most effective strategy. More effective investigation and restraint of conflict economy actors will require systemic efforts to improve transparency and enhance the institutional capacity of anti-corruption authorities. International policymakers should also support the development of tailored alternative livelihoods that render conflict economy activities less attractive.

He brings decades of experience as a health economist working in international development and health and is an internationally recognized expert on universal health coverage (UHC) and progressive health financing, operating at the highest political levels.

For the past five years, Rob has led the Centre’s work on Universal Health Coverage (UHC) as director of its UHC Policy Forum, which works on the political economy of UHC reform processes and advises political leaders and government ministries on how to plan, finance and implement national UHC reforms.

He has also worked closely with The Elders on presenting policy options on universal health reforms to heads of state across the world. Before leading the UHC Policy Forum at Chatham House, Rob was a senior health economist at the World Health Organization from 2011 to 2014, after moving from the UK Department for International Development (DFID), where he was a senior health economist. Prior to that, Rob was the deputy head of the Integrated UN Office in the Democratic Republic of Congo. He also spent five years working for the government of Uganda as a senior health economist, on secondment from DFID during the early 2000s.

'I am delighted to welcome Rob Yates as the head of the Centre on Global Health Security. He will bring a wealth of experience to the role at a time of risk but also great opportunity in the sector,' said Dr Robin Niblett, director of Chatham House. 'Rob will continue to work on his own area of expertise – universal health coverage – while ensuring the Centre continues to address other major global health challenges that manifest themselves as foreign policy and international affairs problems.'

Rob replaces David Heymann, who retires from the role as the Centre marks its 10th anniversary but will remain involved in several of the Centre’s projects.

'I would also like to pay tribute to David Heymann, who launched the Centre on Global Health Security in 2009 to examine key global health challenges in international affairs and world politics,' Niblett added. 'Without David the Centre would not have had the impact that it has and I am truly grateful for his hard work and achievements over the last 10 years.'

Yates takes up his post this week.

'I am honoured to become the new head of the Centre on Global Health Security and build on the successes delivered by David Heymann and the team over the last decade,' he said. 'My priority as the new head will be to ensure that our research and activities have a real impact in accelerating progress towards the Sustainable Development Goals by focusing on improving health security and health coverage in countries across the world. Engaging in issues related to the political economy of health and health care reforms will be critical in achieving this impact.'