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Gaddafi visits Russia on arms, energy drive

  Libyan leader Muammar Gaddafi makes his first visit to post-Soviet Russia on Friday, seeking to deepen a budding energy and military partnership with Moscow and counterbalance his fast-expanding relations with the West.

The visit, his first to Moscow since 1985 according to Russia’s Nezavisimaya Gazeta daily, is the latest step in a bold push by the former outcast state to accelerate overseas trade and investment for its booming post-sanctions economy. Examples of that drive include a rapid expansion of a Libyan state holding in Italian bank Unicredit and a growing list of Libyan deals in Africa and Europe, including a refinery in Egypt and a wheat farming agreement in Ukraine. “Libya wants to increase its overseas exposure and is showing a surprising sophistication about it, given their years of isolation,” Geoff Porter, an analyst at Eurasia Group, said.

Arms and energy are the focus of the three-day trip. Gaddafi will meet President Dmitry Medvedev six months after welcoming his predecessor and current Prime Minister Vladimir Putin on the first visit by a Kremlin leader to Libya since 1985.

Russia’s Interfax news agency said Libya might agree to buy more than $2 billion worth of Russian weapons during the visit, reviving part of a Cold War-era relationship that saw Moscow arming much of Libya’s military. Libya is interested in buying surface-to-air missiles, fighter aircraft, dozens of helicopters and about 50 tanks, Interfax quoted a source in Russia’s arms industry as saying. Moscow also is seeking rich energy contracts in Libya, owner of Africa’s largest oil reserves, and state gas monopoly Gazprom is showing interest in taking part in the construction of a new gas pipeline linking Libya and Europe.

 

INVESTMENT RUSH

The North African country aims to become a big gas producer and expand production to 3 billion cubic feet per day (bcfd) by 2010, with a potential for 3.8 bcfd by 2015 versus 2.7 bcfd now. In April the two countries signed agreements on debt, energy, railways and investment, marking a renewed effort by Moscow to compete in a market aggressively contested by Western and Asian companies seeking state infrastructure projects.

Libya has seen a foreign investment rush since 2003, when the UN Security Council lifted more than a decade of sanctions imposed for what the West called Libyan support of terrorism. But at least in public, politics may get equal billing with business, analysts said, noting that Gaddafi in April told Putin the world needed a Russian “superpower” to counter an unbalanced international system -- a reference to US global power.

Russian Foreign Minister Sergei Lavrov said last week “the aim of the visit is to develop bilateral relations and exchange views on regional problems which are of mutual interest”. “Clearly the Russians have been courting Libya on energy, and so you’ll have some pipeline politics on this trip, but you’ll also have the Gaddafi world view,” said Jon Marks, editorial director of industry newsletter Africa Energy. “Gaddafi sees a multipolar world and he sees the Russians willing to play. This trip shows he’s needed and loved,” said Marks, noting Libya’s drive for influence in Africa and the Arab world had not always lived up to Gaddafi’s hopes.

Last month US Secretary of State Condoleezza Rice met Gaddafi in Libya, the first such visit in 55 years, in a move to end years of enmity. But there are no plans as yet for a meeting with US President George W. Bush or his successor. “It was a historic moment, but it’s clear that as far as ties to the US are concerned, there’s not going to be a leader-to-leader meeting,” Marks said. (Reuters)