GI-NET/SDC CALLS ON EUROPEAN UNION TO STOP PAYMENTS TO LIBYA’S NATIONAL OIL COMPANY AND CENTRAL BANK

International Escrow Account Could Stop Flow of Funds to Qaddafi

Download release

(Washington, DC) – Genocide Intervention Network / Save Darfur Coalition today called on the European Union (EU) to close critical loopholes that give Muammar Qaddafi access to funds that could enable more attacks on Libyan civilians.

On Friday, the EU is expected to expand sanctions against the Qaddafi regime by freezing assets of the Libyan Investment Authority. It is unclear, however, whether European firms and individuals will be prohibited from doing business with two institutions – the National Oil Company and the Central Bank of Libya – from which Qaddafi can draw substantial financial resources.

“If the EU’s sanctions are to have real teeth, they must prohibit transactions with the National Oil Company and the Central Bank,” said Sam Bell, Executive Director of Genocide Intervention Network / Save Darfur Coalition. “Anything less will allow Qaddafi access to major financial lifelines with which he could continue to fund massive violence against Libyan civilians.” 

Qaddafi’s access to and influence over the government-controlled National Oil Company (NOC) is well understood, and US and UK sanctions already forbid transactions with NOC.  However, payments to NOC remain a key link in the trail of money flowing from the trade of Libyan oil, which continues even after major American and European firms suspended operations. Despite the closure of numerous Libyan ports and banks and insurers’ increasing hesitation to enable international business with Libya, companies from China, Austria and possibly India continue to trade.

On Wednesday, a carrier chartered by Unipec, the oil trading arm of China’s Sinopec, was docked at the Es Sider port, ready to load two million barrels of crude. Austrian oil company OMV has acknowledged its ongoing purchases and its business with NOC. As the company’s CEO stated on Wednesday, “[OMV’s] business partner was always the NOC, the Libyan state oil company. That is still the case now.”

Though Libya’s normal 1.6 million barrels-per-day output has plummeted amidst the crisis there, even limited purchases of crude and payments to NOC could provide significant funds to Qaddafi. Exports reportedly dropped to about 400,000 barrels-per-day last week, but oil shipped over the last two weeks could still provide about $770 million to Qaddafi.

Prohibiting payments to NOC would not have to mean an end to the sale of Libyan crude.

“Creating a UN-authorized escrow account is a way forward that would cut support to the Libyan government while avoiding undue harm to Libyan civilians and the economy,” said Melany Grout, Director of Conflict Risk Network. “This is something CRN has been discussing with oil firms over the past two weeks, and we’ve seen increasing consideration of the idea by government leaders and institutions including the British Foreign Secretary and the UN. In the meantime, it’s critical that the EU close the loophole in its sanctions.” GI-NET / SDC first called for the creation of an escrow account for oil funds on February 22^nd.

###

The Save Darfur Coalition and Genocide Intervention Network merged on November 1, 2010 to create a more powerful voice dedicated to preventing and stopping large-scale, deliberate atrocities against civilians. The organization remains committed to its work to end the crisis in Darfur and bring peace to all of Sudan as well as to end violence in other areas of mass atrocities such as Congo and Burma.  The merger creates the world’s largest anti-genocide organization, with a membership base of hundreds of thousands of committed activists globally, an unparalleled nationwide student movement, more than 190 faith-based, advocacy and human rights partner organizations, and a network of institutional investors with over $700 billion in assets under management.

Conflict Risk Network (CRN), http://crn.genocideintervention.net/ is a network of institutional investors, financial service providers and related stakeholders calling on corporate actors to fulfill their responsibility to respect human rights and to take steps that support peace and stability in areas affected by genocide and mass atrocities. Its goal is to increase such behavior by corporate actors, and thereby reduce conflict risk. CRN is a project of Genocide Intervention Network / Save Darfur Coalition (GI-NET/SDC).