Bush eases Libya's sanctions



For now, the nation remains on the list of state sponsors of terrorism.
WASHINGTON POST
WASHINGTON -- President Bush, acting with unexpected haste, eased economic sanctions against Libya on Friday, opening the door for U.S. oil companies, banks and investors to do business in the once-pariah state responsible for the 1988 downing of Pan Am Flight 103.
Bush said he was rewarding Libya for its decision four months ago to give up its weapons of mass destruction, open its facilities to inspection and cooperate with investigators in a probe of nuclear smuggling.
Administration officials view Libya as a success story that could prove politically useful when the White House is under fire for its failure to find weapons of mass destruction in Iraq.
"Through its actions, Libya has set a standard that we hope other nations will emulate in rejecting weapons of mass destruction," White House spokesman Scott McClellan said in a statement. "Libyan actions since Dec. 19 have made our country and the world safer."
The announcements
As part of Friday's announcement, Bush said he had terminated sanctions set in 1986 by President Reagan -- and strengthened in 1996 -- that had barred four major oil companies from commercial activities in Libya, as well as many other investments by U.S. firms.
He also removed the U.S. objection to Libya's joining the World Trade Organization and said diplomatic ties would be upgraded to allow the establishment of liaison offices in Washington and Tripoli.
Occidental Petroleum Corp., Amerada Hess Corp., Marathon Oil Co. and Conoco Inc. had been operating in Libya before the sanctions had been imposed, and officials at those companies welcomed the move.
Libya's oil production has fallen by half in the past three decades, in part of because of the isolation from years of sanctions, and Libyan officials have been eager to sign new oil contracts with U.S. companies.
Terrorism list
The administration, for the moment, will keep Libya on the list of state sponsors of terrorism, which keeps controls on exports with military potential and prevents the U.S. government from supporting loan requests from such countries in international lending organizations.
Bush also did not allow the resumption of direct air service to Libya or release of hundreds of millions of dollars in Libyan assets frozen in the United States.
"The necessity of ending any tie to terrorist groups or activities will continue to be a central issue in relations with Libya," McClellan said.
But experts said the administration had moved with unusual speed to restore ties with Libya, given its long estrangement from the United States, its admitted role in the bombing of Pan Am 103 that killed 270 people and its dictatorial political system under the rule of Moammar Gadhafi.
"You could make a case the administration at the highest levels is determined to make this work," said Chester Crocker, former assistant secretary of state for Africa under Reagan. "They view it as a win."
Kennedy's surprise
Sen. Edward Kennedy, D-Mass., said that though he welcomed Libya's decision to disarm, he was surprised that Bush "would so quickly strengthen relations with a dictator who opposes democracy, persecutes his own people and continues to cause instability in Africa." He added: "I know today's action easing sanctions is music to the ears of the American oil industry."
Libya has accepted responsibility for Pan Am 103 and promised to pay $10 million in compensation to each family of the victims. Bob Monetti, president of families of Pan Am 103, said that he had "mixed emotions" about the lifting of sanctions.
"If you have sanctions and they change the way a country behaves, what good are they if they aren't lifted?" Monetti said.

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