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08TRIPOLI679 SAIF AL-ISLAM AL-QADHAFI CALLS FOR FURTHER REFORM, THREATENS TO WITHDRAW FROM POLITICS REF: A) TRIPOLI 666, B) 07 TRIPOLI 759, C) TRIPOLI 227 TRIPOLI 00000679 001.2 OF 005 CLASSIFIED BY: Chris Stevens, CDA, U.S. Embassy - Tripoli, Dept of State. REASON: 1.4 (b), (d) 1. (C) Summary: In a lengthy, much-anticipated speech at an annual youth forum gathering, Saif al-Islam al-Qadhafi, son of Muammar al-Qadhafi, implicitly criticized past decisions of his father's regime, called for dramatic changes to Libya's system of governance, claimed that much of his program of social, political and economic reform had been achieved, and said he intended to withdraw from politics to focus instead on civil society and development work. Conceding that Libya had suffered from "stagnation" during the sanctions period, he focused on the government's ambitious development program. The decentralized Jamahiriya system instituted by his father was confusing and had not delivered results, and Libya needed a constitution to underpin a more transparent government structure and more predictable decisionmaking processes. Drawing a line between proposed government restructuring and greater participation by Libyans in their own governance, he called for a more robust civil society, judicial reform, greater respect for human rights, and more press freedoms. Describing Muammar al-Qadhafi as a historically unique figure whose powers and prerogatives could not be inherited, he criticized Arab regimes in which sons succeed their fathers and flatly rejected the idea that he would automatically assume a position of leadership by dint of being his father's son. In the most controversial portion of his remarks, Saif al-Islam claimed that the major foreign policy issues and reform agenda items had been resolved, and that he intended to withdraw from politics. Expected to be a speech in which he previewed his father's upcoming Revolution Day address and clarified reform efforts and perhaps his own role within the government, Saif al-Islam's speech has instead confused Libyans and raised more questions than it answered. There have already been a series of highly-publicized meetings and press articles calling for him to "return" to politics, suggesting that his announced intention to "disappear for awhile" may have been a ploy to engender statements of popular support, possibly to help buttress him against critcism from conservative regime elements unhappy with his reform agenda. Regardless of his intent, the speech has raised doubts about the long-term viability of the reform agenda and called into question whether Saif al-Islam is ready for a formal leadership role. End summary. LIBYA'S FOREIGN POLICY ISSUES HAVE BEEN RESOLVED ... 2. (C) At at the third annual Libya Youth Forum near the southern city of Sabha on August 20, Saif al-Islam al-Qadhafi framed his remarks by saying that Libyan had resolved its major foreign policy issues and no longer faced external threats. (Note: The head of the Federal Express franchise in Libya, who bid on a contract to deliver equipment and supplies to the venue, said the remote site had been selected largely to facilitate better crowd control and security. Demonstrations, which were violently suppressed, broke out at last year's Youth Forum gathering in Benghazi, prompting state media to cut the television feed. End note.) Speaking at a desert venue by the Oubari Lakes, Saif al-Islam referred to the U.S.-Libya comprehensive claims settlement agreement signed by NEA A/S Welch in Tripoli on August 14 (ref A) and noted that embargoes and sanctions were now a thing of the past. The U.S. and other states were now contemplating selling arms to Libya, which had been "just a dream" a few short months ago. Saif's reference to the U.S.-Libya claims agreement drew loud, sustained applause from the crowd of young Libyans. In an implicit criticism of Libya's past foreign policy adventures, Saif al-Islam said that many of Libya's issues with the West had been "unnecessary battles in the first place". ... LEAVING IT TO FOCUS ON REMEDYING INTERNAL "STAGNATION" 3. (SBU) Saying Libya had been "in stagnation for decades" because of international sanctions, Saif al-Islam conceded that Libya was "also at fault" for its period of isolation. He cautioned that while there were many reasons for Libya's past foreign policy decisions, "now is not the time to talk about that". He instead focused on Libya's ambitious program of infrastructure development, much of which is designed to demonstrate tangible benefits of the Fatah Revolution in the run-up to the upcoming 40th anniversary of the September 1, 1969 coup that brought Muammar al-Qadhafi to power. Conceding that infrastructure, housing and development had been neglected for too long, he also tacitly conceded that the current sudden spending spree had occasioned its own problems, saying that the rush to disburse 130 billion Libyan dinar (about USD 108 billion) worth of infrastructure contracts in the past year had led to "confusion and hysteria". In a nod to two key popular TRIPOLI 00000679 002.2 OF 005 concerns, he specifically mentioned large investments in education and health care, claiming that foreign universities and foreign hospitals were being established in Libya. JAMAHIRIYA SYSTEM HASN'T DELIVERED; NEW GOVERNMENT STRUCTURE & CONSTITUTION NEEDED 4. (SBU) Turning to governance, Saif al-Islam resurrected his call for a constitution, something he explicitly advocated in his 2006 Youth Forum speech in Sirte, which drew harsh criticism at the time from the Revolutionary Committees and other conservative regime elements. Reacting to that, Saif al-Islam had softened his language in his 2007 speech in Benghazi (ref B), using the term "social contract". In Sabha this year, he adopted slightly more forward leaning language, saying Libya "needs something, which is perhaps called a constitution - let's say a popular pact similar to the social pact or a pact of the mass of the people". Such a contract should stem from the popular authority of the people, he said, but stressed that a formal document of some kind was needed to enshrine and protect the will of the people against unconstitutional attempts to usurp power as in the recent coup in Mauritania. 5. (SBU) Criticizing the inchoate nature of the decentralized Jamahiriya system, he said Libyans are frustrated with the the existing system's failure to deliver basic services such as trash collection, pest control, water and electricity, and now want a clearly articulated system of rules that govern personal conduct, economic affairs and governance. Describing the bedrock of good governance as effective local government, he stressed that despite the rhetoric about popular local committees, the Jamahiriya system of his father had not delivered on that front. Describing the decision to dismantle formal decisionmaking structures and to effectively decouple the local and central governments as "a mistake", he called for a "new administrative structure" that would better integrate local municipalities and districts with the central government. 6. (SBU) Referring to Muammar al-Qadhafi's March 2 address to the General People's Congress, in which he called for government restructuring and radical privatization (ref C), Saif al-Islam conceded that he had been personally involved in the work of the committees tasked with implementing his father's vision. He emphasized that plans for restructuring the government are underway, and will involve reshaped local institutions and greater privatization. Arguing for aggressive privatization, he said "the state will not own anything" and "everything should be done by the private sector". (Note: As reported ref C, five committees were established to formulate plans for implementing Muammar al-Qadhafi's March 2 vision. Contacts have told us Saif al-Islam established shadow committees staffed by personnel from the Economic Development Board (EDB) and National Planning Council (NPC); the final recommendations for implementing al-Qadhafi's vision reflected heavy input from the shadow committees. End note.) Referring obliquely to reports of fierce infighting over recommendations about restructuring and privatization, Saif al-Islam noted that "many things that were not nice" had happened in the course of recent intra-government debates, but stressed that those issues had been resolved. CIVIL SOCIETY, JUDICIAL REFORM, HUMAN RIGHTS & PRESS FREEDOMS NECESSARY 7. (SBU) Drawing a line between proposed government restructuring and greater direct participation by Libyans in their own governance, Saif al-Islam explicitly called for a more robust civil society, judicial reform, greater respect for human rights, and more press freedoms. Stressing that the best guarantee of "democracy, liberty and human rights" was "a strong, independent, enduring civil society" akin to that in the U.S., he argued that Libya urgently needs a more robust civil society if it is to develop further. Noting his personal involvement in sending an estimated 12,000 Libyan students abroad to Europe, Australia and the U.S. to study, he predicted that great strides would be made when those students returned to work in Libya, and called on Libyan youth to establish civic associations to help ensure government accountability. 8. (SBU) Citing corrupt judicial systems in the former Soviet Union and elsewhere in the Middle East, Saif al-Islam called for a fair judicial system and rule of law, without which "all the things (reforms) that we do will be undermined ... and disappear". In a swipe at Muammar al-Qadhafi's famously TRIPOLI 00000679 003.2 OF 005 mercurial style of leadership, Saif al-Islam linked human rights progress to a stable, clearly articulated political and judicial system, noting that "we want to have an administrative, legal and constitutional system once and for all, rather than change ... every year". In a line that drew sustained applause and wide press coverage, he noted that a new draft legal code was currently being reviewed by the government and said " ... the count-down towards building a state of institutions, constitutions, rule of law, and modern management has started with a set of new laws which is being presented to the people everywhere, incuding the new administrative structure of the country". 9. (SBU) The new legal code, he argued, was critical if Libya was to enshrine essential civil society concepts such as expanded respect for human rights and press freedoms. Conceding that "anybody could have violated your rights" in Libya before, he claimed those days were over. Softening his criticism of past abuses, he said Libya had not been in a position to simultaneously address development and human rights needs. With progress on the development front, respect for human rights was now necessary, in part to help sustain development efforts: "Libyans cannot build the Libya of tomorrow when they are scared and frightened of internal, external security apparatuses, the police and so on". (Note: The Qadhafi Development Foundation, headed by Saif al-Islam, announced an initiative the week before his speech to compensate families of prisoners killed during the government's suppression of a riot at the notorious Abu Salim Prison in 1995. End note.) He called for greater press freedom as a means to help ensure government accountabilitym noting that a more independent press would reveal "where the secret deals are taking place, where the problems lie, and where the conspiracies are being planned". NO ONE CAN INHERIT MUAMMAR AL-QADHAFI'S POWERS & PREROGATIVES 10. (SBU) Criticizing the "forest of dictatorships" in the Middle East, he said modern Arab regimes were characterized by hereditary, dictatorial executives, "fanciful, ineffective parliaments" and human rights violations. Disparaging Arab governance, he complimented the state of Israel, in which a president could be forced from office on sexual harassment charges, and a prime minister on corruption charges. Reprising nomenclature he used in his 2007 Youth Forum address in Benghazi (ref B), Saif al-Islam nonetheless described Muammar al-Qadhafi's role as a "redline" that was beyond criticism and not subject to other government restructuring efforts. Likening his father's position in modern Libya to that of George Washington, Mustafa Kemal Ataturk and the Ayatollah Khomeini, he stressed that Muammar al-Qadhafi's role was historically unique and that neither he nor anyone else was entitled to inherit that mantle. He flatly rejected the proposition that he would automatically assume the position and prerogatives of his father by dint of blood relation. "This is not a private farm to be inherited", he said. For Libya to experience hereditary succession would put the country "at square one again" in terms of political development. SAIF SAYS HE'LL WITHDRAW FROM POLITICS ... 11. (SBU) In the most publicized and controversial part of his address, Saif al-Islam said he would recuse himself from politics and instead focus on civil society and development work. Claiming that "the time of major battles has ended" - he referred to the U.S. claims agreement and foreign policy contretemps such as the Lockerbie bombing and the Bulgarian medics case - Saif al-Islam said "I have no more major battles and my position has become embarrassing". Justifying his prominent role in sensitive affairs of state, he admitted freely that he had intervened extensively in foreign affairs, government restructuring and development " ... because there were " ... no presently-functioning institutions and no administrative system (in Libya) which were capable of doing these jobs". Claiming that much of his program of resolving key foreign policy challenges, initiating government restructuring and development, and human rights reforms had been accomplished and that the rest was "on track", he said his central role was no longer needed or appropriate. Referring to George Orwell's novel "The Animal Farm" as a cautionary tale against the danger of would-be revolutionary leaders recapitulating the errors of the systems they had overthrown, he cautioned that it would be problematic if he were to continue his involvement in political issues. Noting that some regime elements "hated" his reform efforts, he stressed that Libya's future lies with clearly TRIPOLI 00000679 004.2 OF 005 organized institutions and a robust civil society, rather than charismatic personalities. Addressing his future, Saif al-Islam claimed he would withdraw from affairs of state, perhaps "disappear for awhile" and focus on civil society and development efforts. Discounting the possibility that he would be lured back into politics, he stressed that he did not intend to return and said he would rightly be considered "a liar" if he did. .. BUT THE MASSES SAY HE MUST "CONTINUE HIS REVOLUTIONARY JOURNEY" 12. (SBU) Reaction to Saif al-Islam's stated intention to withdraw from politics has been swift and well-coordinated. In a series of meetings held on August 24 at the People's Hall in Tripoli, members of the Revolutionary Committees, various youth organizations, professional associations, and local government committees issued strongly worded calls for Saif al-Islam to "return" to politics. The crowd at the People's Hall frequently broke into chants of "Keep up the journey, oh son of the brave man!" The dean of the lawyers' association, Bashir al-Tawir, said Saif al-Islam was "a revolutionary man who should continue his revolutionary journey". Striking a populist note, Muhammad Aribi, the People's Leadership Coordinator in Tripoli, claimed that "only America and Zionism" would benefit from Saif al-Islam's withdrawal from politics. Similar calls were issued at gatherings of youth organizations around the country that began the day after his speech, and a larger youth event - designed to lure Saif al-Islam back - is scheduled to take place in Benghazi shortly before Muammar al-Qadhafi's Revolution Day speech on September 1. The leadership of the national youth organization and Saif al-Islam's Libya al-Ghad (Libya of Tomorrow) organization reportedly threatened to resign en masse unless he continued in his political role. Unusually, the proceedings at the People's Hall were not covered by state radio or television, but were heavily covered by the Libya Fada'iya satellite channel and Ouea newspaper, both owned by Saif al-Islams 1/09 media group. COMMENT 13. (C) Saif al-Islam's Youth Day speeches are closely followed as a barometer of reform efforts and a harbinger of policy initiatives. Embassy contacts, who expected Saif al-Islam's remarks to clarify expectations about Muammar al-Qadhafi's Revolution Day speech early next week, were instead left confused about the state of the reform agenda and government restructuring, as well as Saif's own political future. Several noted that Saif al-Islam did himself a disservice by clearly departing from his prepared remarks in an attempt at a more improvised delivery. The halting, rambling speech exacerbated the perception that the typically charismatic Saif al-Islam was nervous. Key advisers Omran Bukhres and Dr. Yusuf Sawani were reportedly "beside themselves" that he had departed from the carefully crafted text they helped prepare. Several contacts also noted that there were junctures at which Saif al-Islam appeared to be restraining himself from going further in his remarks, particularly with respect to intra-governmental squabbling about restructuring and rumors that he was hated by conservative regime elements. 14. (C) Few take seriously Saif al-Islam's claim that he intends to withdraw from politics entirely, but there is confusion about what he intended to achieve by threatening to do so. The swift calls for him to "return" suggest a scripted plot to garner political credibility for him as a genuinely populist figure, possibly as a prelude to announcement of a more formal role for him during the upcoming Revolution Day speech. There have been reports on websites that the government restructuring could include a Social Leadership Council, to be headed by a senior figure. Some observers have speculated that his remarks on hereditary Arab regimes and Muammar al-Qadhafi's historically unique role were intended as a subtle warning to his own siblings, some of whom have recently become more naked in their ambitions. A contact with regular access to the family believes that Saif al-Islam intended to signal to his father dissatisfaction that he, Saif, has undertaken the most sensitive, labor-intensive work in the government without benefit of formal position, by contrast with his brother, Muatassim, who was named National Security Adviser last year. 15. (C) Saif al-Islam's claim that work on human rights, personal liberties and development was in "its last round" is broadly seen to be premature. The consensus among Libyans is TRIPOLI 00000679 005.2 OF 005 that while Saif al-Islam has helped contribute to the beginnings of reform in some areas, much remains to be done. A line of thinking we've heard from some of our savvier contacts is that references to accomplishments and intra-government bickering were a tacit admission that he had not yet achieved all he hoped to, in part because of resistance from truculent conservative regime elements. The corollary to that interpretation is that he is still needed to keep those efforts in train. His remarks about closing the books on past mistakes have been interpreted by a number of contacts as a subtle signal to the Revolutionary Committees and other old guard regime elements that he is willing to put aside old grievances. The commonly-held view is that while Libya has made some strides in the right direction since Saif al-Islam's coming out party in 2003, when he previewed a reformist agenda in his first major public address, the gains that have been made to date are modest and not likely to endure absent the active advocacy and protection of a politically well-connected patron. Whether he was sincere in stating his intent to withdraw from politics or meant it as a coy means by which to engender popular support, the effect of Saif al-Islam's speech has been to raise doubts about the long-term viability of the reform agenda (if he in fact exits the scene) and to call into question whether he is really ready for a formal leadership role (if this is all part of an elaborate act of kabuki theater). All eyes are now on Muammar al-Qadhafi and his Revolution Day address on or about September 1. End comment. STEVENS 2008-08-28 2011-02-01 CONFIDENTIAL Embassy Tripoli
08TRIPOLI686 LIBYA FURTHER PRIVATIZES FUEL DISTRIBUTION 2008-09-02 2011-02-01 UNCLASSIFIED//FOR OFFICIAL USE ONLY Embassy Tripoli
08TRIPOLI896 AL-QADHAFI AND THE REFORM "VISION THING" REF: A) TRIPOLI 227, B) TRIPOLI 842, C) TRIPOLI 699 TRIPOLI 00000896 001.2 OF 003 CLASSIFIED BY: John T. Godfrey, CDA, Embassy Tripoli, U.S. Dept of State. REASON: 1.4 (b), (d) 1. (C) Summary: In a meeting broadcast on state-owned television, senior Government of Libya (GOL) officials disagreed with Muammar al-Qadhafi about plans to implement dramatic government restructuring and privatization he proposed last March. Al-Qadhafi blasted the officials, accusing them of wanting to maintain the status quo to continue profiting from corruption, and insisted that plans to restructure the government and directly distribute shares of oil revenues to the Libyan people be implemented. International media have touted the show as a rare glimpse into the opaque Jamahiriya system; however, local observers believe the meeting was a staged piece of political theater designed to give public cover to an expected scaling back of the proposed reforms. Senior GOL officials have told us privately that serious risks (inflation, currency devaluation, etc.) posed by Leader's vision, together with a lack of consensus about how to implement it, mean the project will be delayed until at least the second quarter of 2009. The personal, albeit unpublicized, involvement of Saif al-Islam al-Qadhafi, son of Muammar al-Qadhafi, in implementing the initiative has thrown into stark relief disagreements between the regime's old guard and would-be reformers. More cynical contacts have speculated that al-Qadhafi's intent all along was to raise the specter of privatization and government restructuring to make the increasingly creaky Jamahiriya system seem favorable by comparison and temper calls for more sweeping change. End summary. GOL LEADERS DISPUTE REFORM PLAN 2. (SBU) In a development picked up by Reuters, AFP and the Financial Times, Libya's state-owned Jamahiriya News Agency (JANA) televised a meeting between Muammar al-Qadhafi and senior government officials on November 11 in which several GPC secretaries (minister-equivalents) openly disagreed with the Leader about plans to implement dramatic government restructuring and privatization he first proposed in an address to the General People's Congress in March (ref A). In the meeting, Central Bank Governor Farhat Bengadara warned that implementing plans to directly disburse monthly shares of Libya's oil revenues to the Libyan people would fuel undisciplined consumption (an idea al-Qadhafi specifically refuted in March), spark inflation, precipitate devaluation of the dinar, create a balance of payments deficit and cause a decline in real incomes. Minister of Economy and Trade Ali Essawi cautioned that the combination of direct cash payments and dismantling much of the government structure would not prompt greater production or investment, and would adversely impact long-term economic growth and social development. Instead of direct cash payments, Secretary of the General People's Committee (Prime Minister-equivalent) al-Baghdadi al-Mahmoudi advocated an ill-defined scheme to give Libyans shares in banks and companies through portfolios that would be managed by financial institutions. Pointing to the recent decline in oil prices, several senior GOL officials noted that plan would be more tenable with higher oil prices, but was too risky given the dramatic fluctuations recently seen. AL-QADHAFI (PUBLICLY) INSISTS ON GOING FORWARD 3. (SBU) Striking a populist note, al-Qadhafi blasted the officials, insisting that they wanted to maintain the status quo to keep their positions and continue profiting from corruption. (Note: Al-Qadhafi criticized PM al-Mahmoudi by name in his Revolution Day speech and accused him of being corrupt; his exchange with him in the televised meeting has reinforced widespread expectation that al-Mahmoudi will be sacked in connection with an expected Cabinet shuffle during the March 2009 General People's Congress. End note.) Reprising themes he touched on in March, he said that since multiple efforts to address corruption and mismanagement in the popular committees (ministry-equivalents) had failed, Libyans should instead receive a direct share of oil revenues from which to underwrite health care, education, utilities and investments. Responding to concerns about implementation of the reforms, he stressed that " ... the decision to distribute oil revenues, their sole source of wealth, directly to the people is not negotiable". He conceded that it was "bad luck" that the wealth distribution proposal coincided with declining oil prices, but stressed that the result of the regime's 40-year effort to manage Libya's resources on behalf of its people had been "very bad". He reiterated the argument made in March that once oil revenues were directly distributed, it would no longer be necessary to maintain subsidies or government services (to include health care and education), since people could afford to buy whatever TRIPOLI 00000896 002.2 OF 003 they needed directly. MEDIA BREATHLESS ABOUT OSTENSIBLE VIEW INTO JAMAHIRIYA POLICY DEBATE ... 4. (SBU) International media reaction - JANA broadcast the show, but state-owned media has otherwise not dwelled on it - has largely focused on the unusual spectacle of the ostensible policy debate that took place. Libya watcher and Dartmouth University professor Dirk Vandewalle opined that the meeting reflected the fact that top-down decision-making in Libya was being increasingly questioned and that the power of technocrats had increased. Reuters characterized it as "a rare glimpse into decision-making in the North African country". ... BUT LOCAL OBSERVERS REMAIN UNCONVINCED 5. (C) Observers closer to the scene have been less sanguine, and several senior GOL officials - including those involved in the meeting - had previewed for us in earlier meeetings that lack of agreement about how to implement government restructuring and privatization meant that implementation would be delayed and the scope likely reduced. As reported ref B, CB Governor Bengadara told a visiting U.S. trade specialist in October that while he favored a more aggressive "shock therapy" approach to economic reform than many other senior GOL leaders, he expected the wealth distribution program to take several years to implement and was frankly skeptical about the extent of government restructuring. Dr. Mahmoud Jibril, who heads the Economic Development Board (EDB) and National Planning Council and also leads the five committees tasked with implementing al-Qadhafi's vision, told visiting NEA/MAG Director Stephanie Williams on November 5 that nothing had been firmly decided with respect to government restructuring or privatization of education and healthcare (further details on the Williams-Jibril meeting septel). Conceding that the implementing committees had made little progress in agreeing on a plan, he suggested that change would be unlikely until after the first quarter of 2009. (Note: The General People's Congress typically meets in March; we've been told that they would have to formally bless any restructuring or privatization plans before they could be implemented. End note.) Similarly, Secretary of the General People's Committee for Manpower, Employment and Training (minister-equivalent) Matuq Matuq told us on November 13 that GOL leaders had encountered difficulty in trying to develop plans to implement al-Qadhafi's vision, and flatly told us that privatization and government restructuring would be delayed considerably. SAIF AL-ISLAM'S BEHIND-THE-SCENES ROLE A MIXED BLESSING 6. (C) Part of the issue appears to be that the restructuring and privatization initiatives have become lightning rods for the struggle between the old guard and would-be reformers. Over the summer, contacts told us the five implementing committees had been unable to achieve consensus on whether and how to implement the reforms. A supra-committee under Dr. Jibril was formed to coordinate the implementing committees' work; however, Saif al-Islam al-Qadhafi - who had formed shadow committees composed of staff from his Qadhafi Development Foundation - has played a powerful and at times leading role in shaping implementation plans. A contact at the EDB told us that Saif al-Islam's involvement was a blessing and a curse. His personal status allowed him to advocate more forcefully than most GOL officials; however, the fact that he is at odds with influential members of the regime's old guard raised the stakes in the debate about restructuring and privatization. 7. (SBU) Implementation of the Leader's vision has already been delayed. When he outlined his vision in March, al-Qadhafi called for the five committees to submit plans for implementing the project by September 1, with the idea that he would detail the plan in his annual Revolution Day speech on/about September 1 and that the changes would be initiated before year's end. He disappointed those hopes, instead shifting the goalposts in his Revolution Day speech by saying the committees would submit implementation plans by year's end, and that changes would begin early in the new year (ref C). 8. (C) Comment: While the televised meeting was noteworthy for the fact that it offered the unusual spectacle of ostensible dissent in the sterile Libyan political environment, the fact that a number of the participants raised their hands to publicly dispute the reforms, together with al-Qadhafi's strident insistence on implementing the original plan, smacks of staged TRIPOLI 00000896 003.2 OF 003 political theater. Local observers have expected for some time that al-Qadhafi would in the end - as he's done before - significantly scale back the scope of the reform agenda he announced in March. By explicitly linking the reforms to the populist issue of anti-corruption, al-Qadhafi has seized the moral high ground on an issue of genuine public concern, which would allow him to blame venal GOL officials for failing to execute his vision if the original plan is modified. Doing so would allow him to limit real reform, and would mitigate to a certain extent criticism of the Jamahiriya system that is his brainchild. More cynical contacts have speculated that al-Qadhafi's intent all along was to raise the specter of privatization - particularly of education and healthcare - and government restructuring to make the increasingly creaky Jamahiriya system seem favorable by comparison in the eyes of a largely conservative, risk-averse Libyan public. According to that line of thinking, al-Qadhafi - concerned that Libya's economic opening was creating pressure for political reform - floated the privatization and government restructuring policy balloon largely as a means by which to muddy the waters and create an atmosphere of "constructive chaos" in which to effect limited (vice sweeping) change. It's a tactic he has used before: Libyan contacts are fond of telling the fable of a race in which participants have to carry a sack of rats a certain distance before they chew through the bag. Al-Qadhafi wins because he figures out that by constantly shaking the bag, the rats are too disoriented to make their way out. End comment. GODFREY 2008-11-18 2011-02-01 CONFIDENTIAL Embassy Tripoli
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