The Libyan regime’s diversification of business interests in the Middle East, particularly in banking, broadens the financial options of Muammer Gaddafi as he battles rebels on the ground and financial sanctions in the US and Europe.
Only two months before Libyans revolted against their repressive ruler, the regime further diversified its asset portfolio into friendlier Arab jurisdictions.
The Libyan Investment Authority, the $65bn sovereign wealth fund, for many years has had vast holdings in the Middle East. Its Lafico subsidiary owns hotels in Morocco and Jordan, and large shares in companies ranging from agriculture to pharmaceuticals. But as attempts to block financing to the regime gain momentum in western capitals, the spotlight is turning to the regime’s stakes in banks in the region.
According to Zawya, the information provider, the government has stakes in a dozen banks in the Arab world, including 99.5 per cent of the Lebanon-based north Africa Commercial Bank and 50 per cent of Tunisia’s Banque Arabe Tuniso-Libyenne de Développement et de Commerce Extérieur. Smaller stakes are held in banks in Algeria, the United Arab Emirates and Egypt.
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