Financial Heist of the Century

USI — Thu, 28 Apr 2011 11:29:02 +0000

by: Manlio Dinucci

The objective of the war against Libya is not just its oil reserves (now estimated at 60 billion barrels), which are the greatest in Africa and whose extraction costs are among the lowest in the world, nor the natural gas reserves of which are estimated at about 1,500 billion cubic meters. In the crosshairs of “willing” of the operation “Unified Protector” there are sovereign wealth funds, capital that the Libyan state has invested abroad.

The Libyan Investment Authority (LIA) manages sovereign wealth funds estimated at about $70 billion U.S., rising to more than $150 billion if you include foreign investments of the Central Bank and other bodies. But it might be more. Even if they are lower than those of Saudi Arabia or Kuwait, Libyan sovereign wealth funds have been characterized by their rapid growth. When LIA was established in 2006, it had $40 billion at its disposal. In just five years, LIA has invested over one hundred companies in North Africa, Asia, Europe, the U.S. and South America: holding, banking, real estate, industries, oil companies and others.

In Italy, the main Libyan investments are those in UniCredit Bank (of which LIA and the Libyan Central Bank hold 7.5 percent), Finmeccanica (2 percent) and ENI (1 percent), these and other investments (including 7.5 percent of the Juventus Football Club) have a significance not as much economically (they amount to some $5.4 billion) as politically.

Libya, after Washington removed it from the blacklist of “rogue states,” has sought to carve out a space at the international level focusing on “diplomacy of sovereign wealth funds.” Once the U.S. and the EU lifted the embargo in 2004 and the big oil companies returned to the country, Tripoli was able to maintain a trade surplus of about $30 billion per year which was used largely to make foreign investments. The management of sovereign funds has however created a new mechanism of power and corruption in the hands of ministers and senior officials, which probably in part escaped the control of the Gadhafi himself: This is confirmed by the fact that, in 2009, he proposed that the 30 billion in oil revenues go “directly to the Libyan people.” This aggravated the fractures within the Libyan government.

U.S. and European ruling circles focused on these funds, so that before carrying out a military attack on Libya to get their hands on its energy wealth, they took over the Libyan sovereign wealth funds. Facilitating this operation is the representative of the Libyan Investment Authority, Mohamed Layas himself: as revealed in a cable published by WikiLeaks. On January 20 Layas informed the U.S. ambassador in Tripoli that LIA had deposited $32 billion in U.S. banks. Five weeks later, on February 28, the U.S. Treasury “froze” these accounts. According to official statements, this is “the largest sum ever blocked in the United States,” which Washington held “in trust for the future of Libya.” It will in fact serve as an injection of capital into the U.S. economy, which is more and more in debt. A few days later, the EU “froze” around 45 billion Euros of Libyan funds.

The assault on the Libyan sovereign wealth funds will have a particularly strong impact in Africa. There, the Libyan Arab African Investment Company had invested in over 25 countries, 22 of them in sub-Saharan Africa, and was planning to increase the investments over the next five years, especially in mining, manufacturing, tourism and telecommunications. The Libyan investments have been crucial in the implementation of the first telecommunications satellite Rascom (Regional African Satellite Communications Organization), which entered into orbit in August 2010, allowing African countries to begin to become independent from the U.S. and European satellite networks, with an annual savings of hundreds of millions of dollars.

Even more important were the Libyan investment in the implementation of three financial institutions launched by the African Union: the African Investment Bank, based in Tripoli, the African Monetary Fund, based in Yaoundé (Cameroon), the African Central Bank, with Based in Abuja (Nigeria). The development of these bodies would enable African countries to escape the control of the World Bank and International Monetary Fund, tools of neo-colonial domination, and would mark the end of the CFA franc, the currency that 14 former French colonies are forced to use. Freezing Libyan funds deals a strong blow to the entire project. The weapons used by “the willing” are not only those in the military action called “Unified Protector.”

http://globalresearch.ca/

At least we are not Dubai

USI — Tue, 27 Apr 2010 08:07:05 +0000

by: George Fulton

We haven’t got a lot to be thankful for these days in Pakistan.

But at least we are not Dubai.

Fed up with loadshedding, bombs, and TV cynicism pervading Pakistan, I recently escaped to Dubai for a holiday. Big mistake. Huge. Ten days later I returned, gasping for Karachi’s polluted, but far sweeter, air. Dubai may have the world’s tallest building and the world’s largest shopping mall, but it also has the world’s tiniest soul. It’s a plastic city built in steel and glass.

It has imported all the worst aspects of western culture (excessive consumption, environmental defilement) without importing any of its benefits (democracy, art). This is a city designed for instant gratification a hedonistic paradise for gluttons to indulge in fast food, fast living and fast women. It’s Las Vegas in a dish dash. You want to eat a gold leaf date? Munch away.

You want to drink a Dhs 3,000 bottle of champagne? Bottoms up. You want a UN selection of hookers at your fingertips? Tres bien. Let’s start with the malls. These cathedrals of capitalism, these mosques of materialism are mausoleums of the living dead. Slack jawed zombies roam around consuming food, clothes and electronics in a desperate attempt to fill the emptiness of their existence.

Whilst at the Mall of the Emirates the azan goes off. Nobody appears to move to the prayer room; everyone’s too busy performing sajda before Stella McCartney, genuflecting before Gucci, and prostrating themselves at Prada. With Dubai, one recalls F Scott Fitzgerald’s The Great Gatsby.

The people are modern day Gatsbys, buying shirts that they will never wear and books they will never read. Like Fitzgerald’s roaring 20s America, Dubai is a moral failure a society obsessed with wealth and status. Everyone is trying to keep up with the Jones’ or the Javaids. You see the goras with their perma-tans, streaked highlights and their flabby cleavages.

The upwardly mobile South Asian man prances around wearing a silly shirt with a large picture of a polo player on a horse, whilst their women wear oversized sunglasses and carry oversized handbags. And the Arabs walk about with enough gold bling to blind you at ten paces. But not everything that glitters is gold. And Dubai is not only morally bankrupt it is also financially bankrupt.

Lately, Dubai, and its ruler, Sheikh Mohammed Al-Maktoum have been compared to another piece of literature — Percy Shelley’s famous poem Ozymandias, which illustrates the inevitable decline of all leaders and the empires they build. Shelley finishes it thus: Look on my works, ye mighty, and despair! Nothing beside remains.

Round the decay Of that colossal wreck, boundless and bare The lone and level sands stretch far away With $80b of debt and a stock and property market that has tanked, the comparisons with Ozymandias are apt. Abu Dhabi may have bailed them out but can Dubai survive as a regional hub in the long-term? Or will this city of hubris built on sand and folly sink back into the dunes a desert mirage that evaporates once the public relations people, the speculators and the tourists disappear?

So for all you naysayers that bemoan Pakistan and its numerous problems please temper your pessimism. Take time to celebrate our cultural, religious, linguistic plurality and richness. Stop the cynicism coursing through your corroded veins. For all its inadequacies, at least we have a democracy.

For all its irresponsibility, at least we have a robust media. For all the police corruption, at least we are not a police state. For all our littering, at least we have paper wallahs. Remind yourself that at least we have a heart. At least we have a soul. At least we are not Dubai.

United States of Islam » Reports

Financial Heist of the Century

At least we are not Dubai