Case 78-8 and 92-12

United States v. Libya (1978–2004: Gadhafi, Terrorism). United Nations v. Libya (1992–99: Pan Am 103)
May 1, 2008

Chronology of Key Events


US bans military equipment sales to Libya in retaliation for Libyan support of terrorist groups.
(New York Times, 21 January 1982, A1)

March 2, 1979

Deputy Assistant Secretary of State Morris Draper informs Congress that State Department, having received assurances that planes would be used only for national airline, has approved sale of three Boeing 747s, two 727s to Libya. (New York Times, 3 March 1979, A5)

September 29, 1979

Revised Export Administration Act, with amendment on terrorism sponsored by Representative Millicent Fenwick (R-NJ), is enacted. In accordance with amendment, State Department names Libya, Syria, Iraq, South Yemen as countries that, because of support for terrorism, may not receive certain US exports; exports of some other goods is made contingent upon congressional approval. (Flores 564, 570)

March 18, 1981

Secretary of State Alexander M. Haig Jr. claims that Libya is running training camps for terrorists.
(Facts on File 1981,169)

May 6, 1981

US closes Libyan diplomatic mission in Washington, citing inter alia its "support for international terrorism." (New York Times, 7 May 1981, A1)

August 1981

US Navy F-14s are fired upon by, shoot down two Libyan fighter jets over Gulf of Sidra, which Libya claims as territorial waters. (New York Times, 20 August 1981, A1)

October 28, 1981

US imposes controls on exports of small aircraft, helicopters, aircraft parts, avionics to Libya to "limit Libyan capacity to support military adventures in neighboring countries."
(General Accounting Office [GAO] 4)

November 1981

Exxon abandons its Libyan operations.
(Wall Street Journal, 11 December 1981, 3)

December 6, 1981

US defense attaché is murdered in Paris; some observers suspect Libyan involvement.
(Schott 16; Flores 582)

December 7, 1981

President Ronald Reagan claims US has evidence that Libyan leader Moammar Gadhafi has sent assassination teams to murder top US officials.
(Washington Post, 11 December 1981, A28)

December 11, 1981

Reagan administration calls on 1,500 Americans residing in Libya to leave "as soon as possible," citing "the danger which the Libyan regime poses to American citizens." US passports are declared invalid for travel to Libya. (Washington Post, 11 December 1981, A1; Wall Street Journal, 11 December 1981, 3)

December 12, 1981

US oil firms agree to withdraw US personnel but announce they will be replaced with other foreign technicians. (Washington Post, 12 December 1981, A1)

January 21, 1982

Libya is reported to have rebuilt 400 heavy-duty trucks (sold to Libya by Oshkosh Trucks) to carry tanks and for other military purposes, despite written guarantees that the vehicles would be used solely for agricultural purposes. (New York Times, 21 January 1982, A1)

10 March 1982

Reagan embargoes crude oil imports from Libya, invoking section 232 of Trade Expansion Act of 1962, drawing on same national security finding made in case of Iranian oil in 1979. Presidential proclamation states: "Libyan policy and action supported by revenues from the sale of oil imported in to the United States are inimical to United States national security." In addition, US restricts exports of sophisticated oil, gas equipment, and technology but does not impose retroactive controls or embargo export of items that are available abroad. (Schott 18, 39; Wall Street Journal, 9 November 1982, 39)

November 1982

US State Department warns oil companies (notably Charter Oil, Coastal Corp.) against selling refined products derived from Libyan crude in US. Central Intelligence Agency (CIA) mounts opposition to Libyan occupation of Chad, assists Libyan exiles. CIA Director William J. Casey says these activities might lead to "ultimate" removal of Gadhafi. (Newsweek, 8 November 1982, 55; Wall Street Journal, 9 November 1982, 39)

December 1982

US bars Boeing sale of 12 commercial jets to Libyan Arab Airline for $600 million.
(New York Times, 26 August 1983, A24)

August 1983

Libya sends troops into Chad in hope of overthrowing government of Hissen Habre. France, US support Habre. Reagan administration is divided over export license application for shipment of $40 million marine mooring system to Libya. (New York Times, 19 August 1983, A1, A6; 26 August 1983, A24)

March 18, 1984

In response to alleged Libyan bombing of Omburdman, Sudan, US sends two Awacs surveillance planes to Egypt. (Facts on File 1984, 197)

October 3, 1984

US charges Libya with complicity in laying of mines in Red Sea. (Facts on File 1984, 807)

November 3, 1985

Washington Post reports that President Reagan has authorized covert operation to undermine Gadhafi regime, based on June 1984 CIA assessment that "no course of action short of stimulating Gadhafi's fall will bring significant and enduring change in Libyan policies." (Washington Post, 3 November 1985, A1)

November 15, 1985

US bars imports of refined petroleum products from Libya, which have increased following opening of Ras Lanuf petrochemical complex earlier this year.
(GAO 1987, 18)

December 27, 1985

Coordinated terrorist attacks at Rome, Vienna airports kill 19 people, wound 110; US soon links Abu Nidal, head of a Palestinian faction, to murders, claims he has received "a considerable amount of assistance" from Gadhafi. White House and State Department officials call on other governments to exert economic pressure on Libya to halt its support of terrorism.
(Washington Post, 31 December 1985, A1)

January 7, 1986

President Reagan invokes International Emergency Economic Powers Act to implement comprehensive trade, financial controls against Libya. Order bars most exports and imports of goods, technology, services (except for humanitarian purposes), all loans or credits to Libyan government, transactions "relating to travel by a United States citizen or permanent resident alien to Libya, or to activities by any such person within Libya." However, Treasury regulations permit reexport of US goods to Libya that are substantially transformed in a third country. Given unwillingness of Western allies to join in sanctions against Libya, Reagan sends personal letters to allied leaders asking them "not to undercut US sanctions against Libya by replacing American oil companies and workers being ordered out of that country." Administration officials admit that they did not consult with allies before taking action. (New York Times, 8 January 1986, A6; 9 January 1986, A1; 10 January 1986, A6; Wall Street Journal, 8 January 1986, 2; Washington Post, 8 January 1986, A1; 10 January 1986, A30; GAO 1987, 11)

January 8, 1986

President Reagan orders freeze of Libyan government assets in US banks, including hundreds of millions of dollars of deposits held in foreign branches of American banks, as well as real property, other investments. Action is taken to preclude Libyan withdrawals, deter Libya from collecting on performance bonds placed by US companies doing business with Libya, guard against Libyan expropriation of US assets. (New York Times, 9 January 1986, A1; Wall Street Journal, 9 January 1986, 25; New York Times, 11 January 1986, A4; Caras 675)

January 15, 1986

Deputy Secretary of State John C. Whitehead begins visit to nine NATO countries to seek their support for US sanctions against Libya.
(Washington Post, 14 January 1986, A11)

February 7, 1986

US revises sanctions to allow oil companies to continue operations in Libya temporarily to avoid "abandonment of contracts or concessions [which] would result in a substantial economic windfall to Libya." Rule allows sale of Libyan crude at Libyan ports, but bars drilling for, extracting, distributing, or marketing Libyan oil. In addition, companies are expected to dispose of their Libyan holdings "as soon as practicable on fair and appropriate terms," but no deadline is set. (New York Times, 8 February 1986, 33; Washington Post, 25 March 1986, A1; New York Times, 26 March 1986, A1)

March 24-25, 1986

US Sixth Fleet challenges Gadhafi's claim to territorial waters in Gulf of Sidra, crosses his "Line of Death." Action provokes Libyan attack during which two Libyan patrol boats are sunk, onshore antiaircraft missile site is destroyed. (Washington Post, 15 April 1986, A1; New York Times, 15 April 1986, A1)

April 5, 1986

Terrorist bomb destroys West Berlin discotheque frequented by US servicemen, killing three persons, injuring over 150. US charges Libyan complicity on basis of intercepted Libyan diplomatic transmissions. Reagan states that "evidence is direct, it is precise, it is irrefutable," begins planning military retaliation. (Washington Post, 15 April 1986, A1; New York Times, 15 April 1986, A1)

April 14, 1986

In hopes of forestalling US military response to West Berlin bombing, EC countries agree to reduce size of Libyan embassies, restrict movements of Libyan diplomats in Europe.
(New York Times, 15 April 1986, A12)

April 15, 1986

US bombers attack Gadhafi headquarters, military airfields, suspected terrorist training camps around Tripoli, Benghazi in retaliation for Libyan role in 5 April bombing, and to deter future terrorist acts against US installations. UK allows US to use British airfields for exercise, but France denies overflight rights for US planes. (Washington Post, 15 April 1986, A1, A23; New York Times, 15 April 1986, A1)

May 5, 1986

Leaders of seven major industrial countries at economic summit in Tokyo cite Libya for its support of international terrorism, list a broad range of measures from which each of them could choose to act against countries supporting international terrorism. List includes inter alia arms embargoes, limits on diplomatic missions, improved extradition procedures for accused terrorists, closer cooperation among law enforcement agencies. (Washington Post, 6 May 1986, A1, A14)

May 5, 1986

State Department officials announce that special exemptions for US oil companies in Libya will not be extended beyond 30 June. Companies note that US action will result in sale of their assets at "fire-sale" prices, but that such losses will be minor since Libyan operations are small share of their total business.
(New York Times, 6 May 1986, A14)

May 13, 1986

Libyan Arab Foreign Bank files suit in London seeking payment of funds blocked by Bankers Trust London under US assets freeze. (Weisburg 1006-1011)

June 23, 1986

Treasury amends regulations on Libya to bar reexport of goods incorporating US products from third countries destined for Libyan petroleum industry. (GAO 1987, 12)

June 30, 1986

Treasury revokes special exemptions for US oil companies but authorizes them to enter into standstill agreements with Libyan authorities to maintain their ownership rights for three years while they continue to negotiate the sale of assets to Libya. In the meantime, the oil companies have no claim to current oil production, nor are they obligated to pay current operating expenses. Of more concern to the companies, they also have no claim under the agreements to future reserves and would be locked out if additional reserves are discovered in Libya while bilateral relations remain hostile. (GAO 1987, 16-17)

August 1986

OPEC officials report that France has begun boycotting imports of Libyan oil, refined products. In further attempt to destabilize Gadhafi, Reagan administration sponsors disinformation campaign on extent of Libyan opposition to Gadhafi regime. (Wall Street Journal, 6 August 1986, 20; Schumacher 335)

Fall 1987

On 2 September, High Court of Justice in London rules in favor of Libya, orders Bankers Trust London to transfer to Libyan Arab Foreign Bank $131 million, plus accrued interest, that has been blocked by US assets freeze. US Treasury authorizes payment on 9 October.
(Weisburg 1011)

Late 1988

Reagan administration accuses Libya of producing chemical weapons at plant near Rabta, south of Tripoli. Although Libya claims that plant produces pharmaceuticals, production ceases for over a year. (New York Times, 8 March 1990, A17)

December 21, 1988

Pan Am Flight 103 explodes over Lockerbie, Scotland, killing 270 people. After investigation, US and UK officials charge Libya with masterminding the bombing. (US Department of State 1995, Background Notes-Libya)

Gadhafi reportedly cuts back funding to numerous rebel movements, asks them to close their offices in Libya. In interview in magazine Al Mussawar, Gadhafi admits to having supported terrorists in past, but "when we discovered that these groups were causing more harm than benefit to the Arab cause, we halted our aid to them completely and withdrew our support." Action parallels drop in Libyan foreign reserves to under $3 billion in first quarter of 1989. (Washington Post, 5 September 1989, A15; New York Times, 26 October 1989, A8)

January 1989

Just before the 3-year standstill agreements are to expire, Reagan allows US oil companies to return to Libya via their European subsidiaries. Gadhafi, however, refuses to allow them to return, in effect continuing the standstill and leaving US investments in limbo.
(Rose 134)

September 19, 1989

A French airliner, UTA Flight 772, explodes over Niger, killing all persons aboard. French investigators later uncover evidence implicating Libyan intelligence agents. (Rose 135)

March 1990

Within days of US intelligence reports that chemical weapons production has resumed at Rabta, Gadhafi blames West German agents for alleged fire at plant he claims has caused extensive damage. US intelligence agencies later conclude that alleged fire was elaborate hoax, that Rabta plant is intact, capable of resuming production. (New York Times, 16 March 1990, A3; Washington Post, 19 June 1990, A17)

April 1990

Gadhafi intervenes with Abu Nidal to obtain release of two French hostages, one Belgian; Gadhafi receives "personal thanks" of French President François Mitterrand. (Washington Post, 27 May 1990, A35)

June 1990

Palestinian terrorist, captured with several heavily armed comrades off coast of Israel, claims they were trained in Libya, transported in Libyan boats, accompanied by Libyan adviser. A few months later, Gadhafi expels radical Palestinian group responsible for attack. (Washington Post, 7 June 1990, A30; 5 November 1990, A19)

November 1991

US, UK, France issue joint declaration calling on Libya to surrender for trial those recently charged in the Pan Am and UTA bombings. (Rose 136)

December 2, 1991

The EC calls on Libya to comply with the joint demands and raises the possibility of sanctions if it does not. Libya reportedly begins to move its liquid assets out of Britain and France to Switzerland and Gulf states.
(Rose 136)

December 4, 1991

Libya arrests two men suspected in the bombing of Pan Am Flight 103 but refuses to extradite them to the US or the UK. (International Institute for Strategic Studies, 240)

January 1992

In an effort to stave off a British-backed resolution in the United Nations Security Council imposing sanctions, Gadhafi offers to surrender the Pan Am suspects to an international tribunal. (Rose 136)

March 31, 1992

The Security Council rejects the Libyan offer as inadequate, imposes a total air and arms embargo (UN Security Council Resolution 748) in response to Libya's continuing refusal to extradite the suspects in the bombings. The resolution also restricts the number of diplomats Libya can maintain abroad.
(Washington Post, 12 November 1993, A39)

May 14, 1992

During remarks at a Non-Aligned Movement meeting in Indonesia, Libyan Foreign Minister Ibrahim Mohammed Beshari claims that Libya will abandon terrorism. However, Libya continues to refuse to release two suspects in the Pan Am 103 bombing.
(Financial Times, 15 May 1992, 6)

May 1993

Libya claims that UN travel sanctions have caused the death of over 800 people and cost the country $2.2 billion in lost exports. Gadhafi appeals to his North African neighbors to help broker a UN agreement and hints that Libya would try to open its borders to greater investment and tourism in an effort to end its international isolation. (Financial Times, 10 May 1993, 6)

November 11, 1993

Given Libya's continuing intransigence, the UN Security Council votes to ban the sale of petroleum equipment to Libya and to freeze non-petroleum-related Libyan government assets abroad. The sanctions fall short of a US effort to prohibit the export of Libyan crude, a move opposed by Germany and Italy. Russia reluctantly votes for the resolution while China, Pakistan, Morocco, and Djibouti abstain. The resolution states that sanctions will be lifted if Libya agrees to extradite to the UK two suspects in the Pan Am 103 bombing. Libya offers to send the two agents to stand trial in Switzerland, but both London and Washington refuse.
(Washington Post, 12 November 1993, A39)

April 1995

In its annual terrorism report, the State Department charges Libya with continued support of international terrorists and involvement in overseas attacks against Libyan exiles. (US Department of State 1995, Background Notes-Libya)

September- October 1995

Libya begins expelling foreign workers, citing the economic hardship incurred as a result of the 1992 UN trade and travel sanctions, and requests permission from the UN to charter flights to repatriate migrant African workers in the country. Tripoli hopes that the expulsions will put pressure on the UN to relax its sanctions program. (Financial Times, 19 October 1995, 8)

December 11, 1995

The UK expels a Libyan diplomat from the special interests section of the Saudi embassy on charges of espionage. Libya retaliates by sending home a British diplomat from the interest section of the Italian embassy in Tripoli. (Financial Times, 12 December 1995, 7)

December 20, 1995

The Senate overwhelmingly approves the "Iran Foreign Oil Sanctions Act of 1995" to impose secondary sanctions on companies that invest over $40 million in Iran's oil and gas industries (See case 84-1, US v. Iran). Senator Edward M. Kennedy (D-MA) adds a last-minute amendment to the bill that extends sanctions to Libya. (Inside US Trade, 22 December 1995, 6)

December 21, 1995

In response to Congressional pressure to pass legislation to impose sanctions on Libya's investment partners, the White House calls on the United Nations to enact tighter sanctions on oil equipment exports to Libya. (Wall Street Journal, 22 December 1995, A4)

January 22, 1996

In a letter to Senate Majority Leader Robert Dole (R-KS), the European Union (EU) strongly criticizes US efforts to impose extraterritorial sanctions in relation to Iran and Libya. (Inside US Trade, 9 February 1996, 17)

May 8, 1996

Administration officials, citing the potential for angering European allies and undermining the UN effort to isolate Tripoli, press Congress to terminate efforts to impose secondary sanctions against foreign firms that invest in Libya. (Inside US Trade, 10 May 1996, 16)

May 1996

Relatives of the victims of the Pan Am 103 bombing file suit against the government of Libya, taking advantage of the opportunities opened by the Anti-Terrorism Act of 1996, which allows victims of terrorist acts abroad to sue foreign countries in US courts.
(Washington Post, 7 May 1996, A13)

July 17, 1996

TWA Flight 800 explodes in midair off the coast of Long Island, killing all 230 on board. Terrorism is suspected but subsequently disproved.
(Journal of Commerce, 19 July 1996, 12B)

July 23, 1996

Congress passes the Iran and Libya Sanctions Act (ILSA). The legislation mandates sanctions when companies: invest more than $40 million in gas and oil development in Libya, or export goods or technology prohibited by UN resolutions which would help Libya acquire weapons, or boost Libya's aviation capabilities. In response, the president must impose two or more of the following six sanctions:

1) Denial of credits from the US Export-Import Bank
2) Denial of export licenses for controlled goods or technology
3) Prohibition of loans of more than $10m from US financial institutions for a 12-month period
4) Prohibition of foreign financial institutions from dealing in US government debt or US government funds
5) Prohibition against participation in any US government procurement project
6) Import restrictions

These sanctions are required to be in effect for up to two years, and in "no case" can they be applied for less than one year. But the bill allows the President to waive "all or part" of the sanctions against a foreign company if doing so is deemed to be in the national interest. The bill has a sunset provision that terminates it five years after enactment. (Financial Times, 25 July 1996, 4; Inside US Trade, 26 July 1996, 4; PL 104-172)

July 24, 1996

The EU expresses outrage at the passage of the Iran and Libya Sanctions Act. The European Commission announces that a regulation being drafted to retaliate against US sanctions on foreign companies trafficking in expropriated US property in Cuba (the Helms-Burton legislation, see Case 60-3) could also be used to retaliate against the Iran and Libya Sanctions Act.
(New York Times, 25 July 96, A14)

July 31, 1996

The UN Security Council warns Gadhafi not to defy UN sanctions, and declares that his expressed intention to fly anywhere he wishes, in violation of the air ban, is unacceptable.
(Journal of Commerce, 1 August 1996, 5A)

August 5, 1996

President Clinton signs the Iran and Libya Sanctions Act at a ceremony attended by relatives of victims of the 1988 bombing of Pan Am Flight 103.
(New York Times, 6 August 1996, A1)

August 8, 1996

French President Jacques Chirac warns the US of "immediate retaliation" if French companies are targeted under the new Iran and Libya Sanctions Act. French energy firms Total and Elf have expressed interest in increasing investment in Iran and Libya. (Journal of Commerce, 8 August 1996, 2A)

August 19, 1996

German authorities arrest two men on suspicion of smuggling high-technology equipment to Libya to enable it to manufacture lethal nerve gas.
(Journal of Commerce, 20 August 1996, 3A)

August 1996

After a trip to the Middle East and Libya, Louis Farrakhan applies to the US Treasury Department for permission to accept a $1 billion donation from Gadhafi. (Wall Street Journal, 26 August 1996, A1)

August 21, 1996

The EU announces that it will appeal to the World Trade Organization if the US punishes any European companies for doing business with Iran or Libya. (Financial Times, 22 August 1996, 3)

August 28, 1996

US Treasury denies Farrakhan's application. Congress later passes broad legislation to prohibit such transactions in the future. (See Case 93-5, US v. Sudan [1993- : Terrorism]; Case 86-1, US v. Syria [1986- : Terrorism]) (Financial Times, 30 August 1996, 5)

October 7, 1996

The US criticizes Turkish Prime Minister Necmettin Erbakan for visiting Libya and signing a new bilateral trade pact. Erbakan counters that his primary objective was to secure repayment of an outstanding debt of $300 million. (New York Times, 8 October 1996, A5)

October 14, 1996

Libya announces that UN sanctions are taking a "tragic toll" on the country, costing $19 billion and causing as many as 21,000 deaths in the past three and a half years. Libya claims agriculture is the hardest-hit sector, with losses estimated at $5.9 billion.
(International Herald Tribune, 14 October 1995, 13)

November 5, 1996

Ente Nazionale Idrocarburi (ENI), Italy's state oil company, announces that it signed a deal in June 1996 to develop Libya's natural-gas resources and build a pipeline to Italy for an estimated $3 billion.
(Wall Street Journal, 5 November 1996, A19)

January 1, 1997

1 January 1997 Libya sentences to death six spies accused of passing defense secrets to foreign governments. According to Egyptian experts, this case may be related to a military coup attempt in October 1993. (Financial Times, 2 January 1997, 2; International Herald Tribune, 3 January 1997, 3)

March 10, 1997

In defiance of US efforts to isolate the Gadhafi regime internationally, the Vatican establishes full diplomatic relations with Libya to "recognize recent positive results in the area of religious freedom."
(International Herald Tribune, 11 March 1997, 6)

May 5, 1997

A group of US senators led by Edward M. Kennedy urges US Ambassador to the UN Bill Richardson to introduce a Security Council resolution for an oil embargo, calling it the only sanction likely to bring about Libyan compliance with UN demands.
(Journal of Commerce, 5 May 1997, 3A)

May 8, 1997

Gadhafi violates UN sanctions by flying to Niger to meet President Ibrahim Barré Mainassara. (Agence France-Presse, 13 May 1997; USA Today, 9 May 1997, 6A)

August 17, 1997

Four African leaders-the presidents of Burkina Faso, Chad, Mali, and Niger-issue a statement calling on the UN to look into the impact of economic sanctions on Libya. They meet with Gadhafi and jointly call on each country to "develop their economic relations and reinforce the mechanisms of cooperation with the goal of reinforcing stability in the region."
(Agence France-Presse, 17 August 1997)

September 21, 1997

In defiance of UN sanctions against Libya, the Arab League approves a resolution urging Arab countries to "take measures to alleviate the sanctions on Libya," including allowing Gadhafi to travel by plane to member states. The resolution also authorizes humanitarian flights and encourages member countries to release Libyan nonoil funds frozen in Arab banks.
(New York Times, 22 September 1997)

October 1997

Despite US opposition, South African President Nelson Mandela travels to Libya for a diplomatic visit; complying with UN flight ban, he flies to a border town and arrives by road. Mandela, who is grateful for Gadhafi's support in the fight against apartheid, is the most influential visitor to Libya since the 1992 flight ban. He presents Gadhafi with South Africa's Order of Good Hope, the country's highest award for a foreigner. (Washington Post, 23 October 1997, A27; Washington Post, 30 October 1997, A30)

October 1997

The Libyan government sends letters to families of victims of Pan Am 103, urging them to accept a financial settlement and oppose sanctions.
(Seattle Times, 19 October 1997, A17)

December 2, 1997

New York Times reports that a massive Libyan underground pipe project, the Great Man-Made River Project, could serve as a conduit for troops and military vehicles. The pipeline, made of pipes 13 feet in diameter, has large underground storage facilities every 50 or 60 miles and runs through a mountain where intelligence sources report Gadhafi is constructing a chemical and biological weapons plant.
(New York Times, 2 December 1997, A1)

February 26, 1998

US District Judge Thomas Platt rules that families of the victims of Pan Am 103 bombing can sue Libya. Lawyers argue that frozen Libyan assets could be used to pay award damages to the families. The decision is appealed by Libya. (Newsday, 4 March 1998, A28)

February 27, 1998

Acting on Libya's March 1992 complaint, the International Court of Justice in The Hague rules that it has authority to decide whether Libya must surrender two of its citizens for trial over the Pan Am 103 bombing in 1988. The US, the UK, and France had unsuccessfully argued against ICJ involvement, on the grounds that the UN Security Council's 1992 and 1993 resolutions precluded the court's involvement. Libya argued that under the 1971 Montreal Convention against aviation terrorism it is not required to extradite the two agents and has the right to try the suspects itself or send them to a neutral country for trial. Calling the ruling a victory, Libya claims the UN sanctions should be declared null and void. (New York Times, 28 February 1998, A4; Financial Times, 28 February 1998, 4)

March 20, 1998

At the request of the Libyan government, the UN Security Council holds a debate on sanctions against Libya. In response to Libyan claims of injury, US Ambassador Richardson argues that "if Libya suffers economically, it is certainly not because of UN sanctions," and points out that UN sanctions "are targeted sanctions, imposed to address aspects of Libyan involvement in international terrorism, but specifically designed to prevent suffering among the Libyan people." (Agence France-Presse, 6 March 1998; US Information Service, 20 March 1998; Washington Post, 21 March 1998, A18)

April 12, 1998

Libya agrees to let Germany question its agents about a discotheque bombing that killed two US servicemen and a Turkish woman in 1986.
(Washington Post, 12 April 1998, A20)

June 8, 1998

The heads of state of the Organization of African Unity (OAU) call on African nations to suspend compliance with the UN air embargo on Libya for all religious, humanitarian, or OAU-related flights. The OAU also asserts that it will ignore all sanctions on Libya starting in September if the US and the UK have not agreed by then to try the Pan Am 103 bombing suspects in a third country. State Department spokesman James Rubin states, "We are extremely disturbed by this short-sighted action, which constitutes a direct assault on the authority of the Security Council ..." and calls on OAU member states to ignore the OAU resolution. (US Department of State, 10 June 1998; US Information Service, 12 June 1998)

August 24, 1998

Secretary of State Madeleine Albright and UK Foreign Secretary Robin Cook unveil a proposal to hold the trial of the two suspects in the Pan Am 103 bombing under Scottish law in a court in Netherlands. If convicted, the suspects are to serve time in British prison. Albright stresses that the deal is a "take-it-or-leave-it proposition" and that the US will push for additional sanctions, including an oil embargo, if Libya refuses the offer. (Washington Post, 25 August 1998, A1, A11; Financial Times, 25 August 1998, 5)

August 25, 1998

The Arab League, Egypt, Sudan, and South African President Nelson Mandela express support for the US-UK proposal. (Scotsman, 26 August 1998; New York Times, 26 August 1998, A7)

August 27, 1998

The UN Security Council votes to suspend sanctions on Libya if Gadhafi extradites the Pan Am 103 bombing suspects for trial in The Hague and cooperates with the French investigation into the 1989 bombing of UTA Flight 772. The Security Council threatens additional measures if Libya does not surrender the suspects for trial. Libyan acceptance of the offer, however, will not necessarily end unilateral American sanctions. (Agence France-Presse, 6 September 1998; US Information Service, 28 August 1998; Financial Times, 26 August 1998, 4; 29-30 August 1998, 4; New York Times, 25 August 1998, A9)

August 27, 1998

Having accepted the proposal in principle a few days earlier, Gadhafi asks for a variety of guarantees to ensure fair treatment of the suspects before he will surrender them for trial in the Netherlands.
(Washington Post, 28 August 1998, A26)

September 5-6, 1998

The presidents of Niger, Chad, Mali, Eritrea, and Sudan defy the UN air embargo and fly to Libya to celebrate anniversary of Gadhafi's accession to power in 1969. (Agence France-Presse, 6 September 1998)

September 29, 1998

In a speech to the UN General Assembly, Libya's UN ambassador, Abuzed Omar Dorda, describes the US-UK offer on the Pan Am 103 bombing suspects to be "honey with a dose of poison." Dorda demands guarantees that the suspects will not be extradited to the US or the UK and that if convicted they would serve their sentences in a third country or in Libya. (Washington Post, 27 October 1998, A16; Washington Post, 30 September 1998, A20)

October 26, 1998

American and British officials maintain that Libya's demand for the Pan Am 103 bombing suspects to serve any sentence outside the US and the UK is not acceptable. The US official says that "if Libya continues to press its demand, there can be no agreement." (Washington Post, 27 October 1998, A16)

December 5, 1998

UN Secretary-General Kofi Annan meets with Gadhafi in Libya to try to break the deadlock on transferring the Pan Am 103 bombing suspects; describes their discussions as "fruitful and positive."
(Washington Post, 6 December 1998, A35)

December 21, 1998

At a memorial service marking the tenth anniversary of the Pan Am 103 bombing, President Clinton states that if Libya does not surrender the suspects for trial before the UN reviews the sanctions against Libya in February, the US will press for harsher sanctions. (New York Times, 30 January 1999, A3; US Information Service, 21 December 1998)

February 26, 1999

The US and Britain reiterate that unless Gadhafi releases the Pan Am 103 bombing suspects for trial within 30 days, they will press for more sanctions in the UN Security Council. However, they fail to convince the Security Council to impose a precise deadline. (New York Times, 27 February 1999, A3; Washington Post, 27 February 1999, A13)

March 10, 1999

France convicts six Libyans in absentia for the 1989 bombing of the UTA airliner over Niger. Because French law does not recognize convictions in absentia, the six would have to be retried if they are extradited to France. (Washington Post, 11 March 1999, A23)

March 19, 1999

After talks in Tripoli, South African President Nelson Mandela announces that Libya agreed to hand over the suspects for trial on April 16.
(Financial Times, 20-21 March 1999, 1)

April 5, 1999

1999 The two Pan Am 103 bombing suspects, 47-year-old Abdel Basset Ali al-Meghrahi and 43-year-old Lamen Khalifa Fhimah, are delivered from Libya to The Hague for trial. Three Scottish judges will decide the case. If convicted, the men will serve their sentences in a Scottish jail under UN supervision. Britain reportedly assured Gadhafi that no witnesses would come from Libya and that all witnesses would have immunity from arrest. Britain also reportedly told Gadhafi that the evidence was only against al-Meghrahi and Fhimah, and not against higher members of the Libyan government. UN Secretary-General Annan announces that UN sanctions against Libya will be suspended, and can be lifted after 90 days. Annan reportedly gave Gadhafi assurances that a new resolution would be needed to reinstate the sanctions. The unilateral US sanctions, however, remain in force. State Department spokesman James Rubin says the US wants "additional concerns alleviated." (, 5 April 1999; Wall Street Journal, 6 April 1999, A28; Financial Times, 15 February 1999, 1; 6 April 1999, 12; 7 April 1999, 11)

April 22, 1999

At the first major investor conference in Geneva after UN sanctions were suspended, the head of exploration at Libya's National Oil Corporation Ibrahim Bagger assures US oil companies that Libya will honor the 1986 standstill agreement although it lapsed in 1989.
(Journal of Commerce, 22 April 1999, 9A)

April 28, 1999

President Clinton announces that the United States will exempt exports of food and medicine from future sanctions imposed by the executive branch. The new rules also apply to food and medicine sales to Iran, Libya, and Sudan, which will be permitted on a case-by-case basis. Specific licensing rules will be drawn up for each country and there will be no US government funding, financing, or guarantees for the sales. (USIS, 28 April 1999)

June 11, 1999

At the first official meeting between US and Libya in 18 years, US Representative to the UN A. Peter Burleigh tells Libya that the United States will not support permanent lifting of UN sanctions until Libya stops supporting international terrorism and meets other conditions required by UN resolutions, including compensation payments to the victims' families and full cooperation with the trial.
(New York Times, 12 June 1999, A4)

July 8, 1999

UK announces resumption of diplomatic ties with Libya after 15 years. Relations are renewed after Libya accepted "general responsibility" for the 1984 shooting of a policewoman outside the Libyan embassy in London and agreed to compensate her family. (Financial Times, 8 July 1999, 8; Washington Post, 8 July 1999, A18)

July 17, 1999

Libya pays $31 million to France to compensate the families of those killed in the bombing of UTA flight in 1989. French Foreign Ministry states that payment is acknowledgment by Libya that its officials were responsible for the deaths.
(New York Times, 17 July 1999, A5)

July 28, 1999

Italy's state oil company ENI announces it has reached final agreement with Libya to invest $5.5 billion to develop oil and gas reserves. The initial agreement dates back to June 1996. Libya is seeking $35 billion in investments between 2001-2005. (The Wall Street Journal, 28 July 1999, A17; Financial Times, 7 October 1999, 9)

December 1, 1999

Italian Prime Minister Massimo D'Alema is the first Western leader to visit Libya in 8 years. (New York Times, 2 December 1999, A5; Financial Times, 3 December 1999, 9)

March 20, 2000

Japan announces it no longer considers Libya a terrorist threat and that it is considering lifting sanctions. (Reuters, 20 March 2000)

May 3, 2000

Lockerbie trial begins in Camp Zeist, the Netherlands. The two defendants, Abdel Basset Ali Mohmed al-Meghrahi and Al-Amin Khalifa Fhimah, are charged with murder, conspiracy to murder, and violation of the 1982 Aircraft Security Act. The suspects plead not guilty and blame Palestinian terrorists for the crime. (Financial Times, 3 May 2000, 8; Washington Post, 4 May 2000, A1)

August 25, 2000

To counter speculations of a secret deal with Libya, Secretary General Kofi Annan releases the letter sent to Gadhafi that led to a compromise on Lockerbie trial. The letter assures Gadhafi that the trial will not be used by the United States and the United Kingdom to undermine his regime and that standard Scottish trial procedures will be followed. (New York Times, 26 August 2000, A6; Washington Post, 26 August 2000, A14)

October 20, 2000

French court, rejecting arguments that Gadhafi is immune from prosecution as head of state, rules that a case against the Libyan leader over the bombing of French airliner UTA can proceed.
(Washington Post, 21 October 2000, A18)

January 8-10, 2001

Arguing that prosecution failed to present sufficient evidence to secure a conviction, defense rests its case in the Lockerbie trial. Two days later, prosecution drops all but the murder charges. (Washington Post, 9 January 2001, A16; 10 January 2001, A15)

January 31, 2001

In a unanimous ruling Scottish judges find Abdel Basset al-Megrahi guilty of murder and sentence him to life in prison, but acquit second defendant, Al-Amin Khalifa Fhimah. The United States makes clear that the verdict alone will not lead to lifting of sanctions. Libya needs to meet other requirements laid out in the Security Council resolutions, including compensation to the victims' families and the acceptance of responsibility. The United Kingdom supports US position. (USIS, 31 January 2001; Washington Post,1 February 2001, A1, New York Times, 1 February 2001, A8)

February 2, 2001

During welcome home celebrations for Al-Amin Khalifa Fhimah, Gadhafi announces Libya will not pay compensation to the victims' families or acknowledge official responsibilities. A few days later Gadhafi charges that the Lockerbie verdict was "politically tainted" and reiterates that no compensation will be paid. (Washington Post, 2 February 2001, A1; 6 February 2001, A14; New York Times, 2 February 2001, A1, A11; 6 February 2001, A10)

February 7, 2001

Lawyers of the convicted Libyan file an appeal of his murder conviction. (Associated Press, 7 February 2001)

July 27, 2001

Congress renews the Iran-Libya Sanctions Act of 1996 for another five years despite opposition from the US business community and the Bush administration. Closing current loopholes, the ILSA Extension Act of 2001 lowers the threshold for foreign investment in Libya from $40 million to $20 million and defines amendments and modifications to existing contracts as new contracts. The act also requires the president to submit a report to Congress within 24 to 30 months on the effectiveness of the sanctions, their impact on other US economic and foreign policy interests, and the humanitarian situation in Iran and Libya. The president can also recommend that ILSA be modified or terminated. European Commission criticizes the extension of ILSA and threatens to retaliate if sanctions are imposed against European companies. (International Trade Reporter, 2 August 2001, 1243; White House press release, 3 August 2001; Katzman 39-40; Reuters, 3 August 2001)
September 2001 Gadhafi condemns the terrorist attack in New York and Washington as "horrifying" and offers the United States intelligence assistance on Osama bin Laden and al-Qaeda. (Wall Street Journal, 14 January 2002, A4; Economist, 19 January 2002, 39)
November 14, 2001 German court finds four people guilty of involvement in the bombing of a West Berlin nightclub in 1986. The court concludes that the "the Libyan state was at least to a large extent responsible" because the attack "was planned by members of the Libyan secret service in senior positions in the Libyan [embassy] in East Berlin." (Financial Times, 14 November 2001, 6; New York Times, 14 November 2001, A5)
November 2001 Libyan envoy to the United Nations Abdurrahman Mohamed Shalghem notes that Libya "is a party to most international agreements in the field of disarmament, and is in the process of acceding to the rest, including the Chemical Weapons Convention and the Nuclear Comprehensive Test Ban Treaty." In February, US Secretary of Defense William Perry had hinted at a possible US military strike to prevent the underground chemical plant at Tarhuna from becoming operational. (New York Times, 20 December 2001, B1, B4)
March 15, 2002 Appeal by Abdel Basset al-Meghrahi of his life sentence in connection with Lockerbie bombing is denied.
(Financial Times, 15 March 2002, 8)
March 12, 2003 Libya agrees to take some measure of responsibility for the Pan Am bombing after US and UK assurance that the move would not be used as grounds for legal action against the government. Compensation of victims and acceptance of responsibility are conditions for the lifting of UN sanctions. US deputy secretary of state Richard Armitage states, "We are in striking distance of an agreement to lift [UN] sanctions. But no one in the State Department is talking about lifting US sanctions. Our concern is weapons of mass destruction. The UN's is Lockerbie." (Washington Post, 12 March 2003, A8; Financial Times, 14 March 2003, 11; 1 May 2003, 6)
August 13, 2003 Lawyers for the families of the Pan Am victims and Libya sign an agreement on $2.7 billion in compensation, to be deposited in an account at the Bank of International Settlements. The proposed payments schedule is closely linked to the lifting of UN and US sanctions. Families will receive $4 million after UN sanctions are lifted, another $4 million when US sanctions are lifted, and a final $2 million once Libya is removed from the list of state sponsors of terrorism. In order for families to receive the second and third installments, US sanctions must be lifted within eight months. (New York Times, 13 August 2003, A8; Financial Times, 15 August 2003, 2; Washington Post, 16 August 2003, A15)
August 15, 2003 Libya submits a letter to the UN Security Council accepting responsibility for the bombing of Pan Am flight 103 as a "sovereign state accepting responsibility for the actions of its officials." Wording of Libya's letter, carefully negotiated in talks with the United Kingdom and the United States, ties its legal responsibility to the employment of Meghrahi, not to an admission of government involvement. Fulfilling the remaining UN condition, Libya also officially renounces all forms of terrorism. (Washington Post , 16 August 2003, A1; New York Times, 16 August 2003, A6)
August 18, 2003 The United Kingdom submits a resolution calling for the lifting of UN sanctions. Secretary of State Powell states that "[t]he lifting of sanctions at the United Nations will not affect U.S. bilateral measures, which will remain in place." France threatens to veto the resolution unless Libya offers larger compensation to families of UTA bombing victims. (International Trade Reporter, 21 August 2003, 1405; Washington Post, 19 August 2003, A16)
September 12, 2003 The UN Security Council formally lifts 11-year-old sanctions against Libya after Libya and France reach a tentative agreement on the UTA issue. France and the United States abstain from the 13-0 council vote. (Financial Times, 12 September 2003, 6; 13-14 September 2003, 3)
December 19, 2003 President Bush and British Prime Minister Blair announce that, after nine months of secret negotiations, Libya has agreed to disclose and dismantle its nuclear, biological, and chemical weapons programs; accede to the Chemical Weapons Convention; destroy all missiles with a range greater than 180 miles, and allow international inspectors unconditional access to monitor and verify compliance. The agreement follows the seizure of illegal shipments of uranium-enrichment equipment to Libya in early October as part of the US-led Proliferation Security Initiative launched in May. Bush administration emphasizes that the United States will not offer rewards or lift sanctions until Libya actually starts dismantling its weapons of mass destruction. (New York Times, 20 December 2003, A1; 21 December 2003, 21; Washington Post, 20 December 2003, A1, A18; 23 December 2003, A14; Wall Street Journal, 31 December 2003, A4)
December 28, 2003 International Atomic Energy Agency Director Mohamed El Baradei and a team of inspectors arrive in Libya for the first inspection of four previously undeclared nuclear facilities. Inspectors praise Libya's cooperation. (Washington Post, 29 December 2003, A13; New York Times, 30 December 2003, A9)
January 9, 2004 Libya signs an agreement with France on payment of an additional $170 million to the families of people killed in the bombing of the UTA 722 flight.
(Washington Post, 10 January 2004, A1)
January 14, 2004 Libya ratifies the nuclear test ban treaty and agrees to host a station monitoring compliance with the treaty on its territory. Libya also ratified the Chemical Weapons Convention. ( Washington Post , 15 January 2004, A18; International Trade Reporter , 22 January 2004, 146)
January 19, 2004 US and UK weapons experts return to Libya to begin dismantling, removing, and destroying technology and materials related to Libya's weapons of mass destruction programs. (New York Times, 20 January 2004, A3)
End of January 2004 US military transports 55,000 tons of nuclear-related equipment and material from Libya to the US. Wall Street Journal reports that shipment is only 5 percent of equipment the US plans to remove but contains the most sensitive items. (Wall Street Journal, 2 February 2004, A3)
February 9, 2004 Foreign Minister Abdurrahman Shalgam arrives in London for the first visit by a Libyan foreign minister since 1969 and the first cabinet level contact. (Financial Times, 6 February 2004, 5; 9 February 2004, 3)
February 26, 2004

President Bush issues executive order lifting travel restrictions to Libya and authorizing US companies with pre-sanctions holdings in Libya to negotiate the terms of their re-entry. Action was delayed for two days after Libyan Prime Minister Skuri Ganem denied Libya was responsible for Lockerbie bombing. Meeting US demands Libyan government releases statement calling Ganem’s comment “inaccurate and regrettable” and reaffirming its responsibility. (New York Times, 24 February 2004, A6; 26 February 2004, A6; Inside US Trade, 27 February 2004)

March 5, 2004

Libya hands over numerous documents detailing its chemical weapons program to the Organization for the Prohibition of Chemical Weapons (OPCW). OPCW’s director general Rogelio Pfirter praises Libya’s cooperation with the organization. (Washington Post, 6 March 2004, A14; New York Times, 6 March 2004, A5)

March 6, 2004

Shipment of remaining nuclear weapons equipment leaves Libya for the US. (Washington Post, 7 March 2004, A17)

March 25, 2004

Prime Minster Tony Blair travels to Tripoli to meet with Gadhafi. After the meeting, Blair announces that British company Shell signed a $200 million deal to explore oil and natural gas in Libya. (New York Times, 26 March 2004, A3; Washington Post, 26 March 2004, A14)

April 23, 2004

In recognition of Libya’s progress in dismantling its WMDs, President Bush terminates the application of Iran-Libya Sanctions Act (ILSA) with respect to Libya and the Department of Treasury modifies sanctions imposed on US companies under IEEPA to allow for the resumption of most commercial activities, financial transactions, and investments. Decision allows US oil companies to sign contracts and do business with Libya. However, Libya remains on the State Departments list of state sponsors of terrorism and subject to export-licensing for dual-use items. In addition, the freeze of Libyan assets and restrictions on direct air service between Libya and US remain in force. (White House Press Release, 23 April 2004; International Trade Reporter, 29 April 2004, 754; Inside U.S. Trade, 30 April 2004, 22)

April 27, 2004

Gadhafi arrives in Brussels for two-day visit to meet with EU officials to discuss his country’s eventual membership in the Euro-Mediterranean Partnership.
(New York Times, 28 April 2004, A3)

June 29, 2004

US formally resumes diplomatic relations with Libya and opens Liaison Office in Tripoli.
(Washington Post, 29 June 2004, A15)

July 27, 2004

Members of World Trade Organization (WTO) agree to start membership negotiations with Libya. Consideration of Libya’s application had been blocked by the US since November 2001. (Financial Times, 28 July 2004, 6; International Trade Reporter, 29 July 2004, 1295)

August 10, 2004

Libya agrees to pay $35 million to non-American victims of bombing of a Berlin disco in 1986. Germany insists that EU arms embargo against Libya cannot be lifted until Tripoli pays compensation. (New York Times, 11 August 2004, A6; Financial Times, 25 March 2004, 6)

September 20, 2004

President Bush declares national emergency with respect to Libya ended and lifts trade embargo and remaining commercial and travel restrictions imposed on Libya. Steps taken include releasing $1.3 billion in frozen assets, lifting the ban on Ex-Im Bank loans, OPIC guarantees, support from US agriculture department programs, and removing restrictions on direct flights between the two countries. However, Libya remains on the list of state sponsors of terrorism. US decision to lift sanctions comes ahead of September 22 deadline for the release of additional payments to the victims of Pan Am flight 103. Libya had extended the deadline twice since April. (New York Times, 21 September 2004, A7; Financial Times, 21 September 2004, 1; Statement by White House Press Secretary, 20 September 2004)

September- October 2004 European Union formally ends suspended UN sanctions and a separate EU arms embargo imposed against Libya. Italy pledges to provide military equipment so that Libya can cooperate in tracking clandestine immigration. (Reuters, 22 September 2004; Financial Times, 23 September 2004, 6; Le Monde, 1 October 2004; Le Monde, 11 October 2004)
16 December 2004 The vice-president of the Central Bank of Libya announces the receipt of assets frozen by US government. The original frozen amount was $400 million, but the amount released totaled $1 billion due to accrued interest.
(Les Echos, 16 December 2004)
23 December 2004

Saudi Arabia recalls its ambassador to Tripoli and expels Libyan ambassador after it discovers evidence of a Libyan plot to kill a member of the royal family
(Agence France Presse, 23 December 2004)

30 January 2005

Occidental Petroleum Corporation wins the lion share of oil exploration permits, the first auction conducted by the Libyan government in 40 years.
(Agence France Presse, 31 January 2005)

10 February 2005

State Department confirms willingness to fully normalize relations with Libya. Two days later, the State Department eliminates movement restrictions for Libyan diplomats in the United States. (Agence France Presse, 10 February 2005; Reuters, 11 February 2005)

12 April 2005

In interview with Frankfurter Allgemeine Zeitung, Seif el-Islam Gadhafi, son of Moammar Gadhafi, announces Libya’s intent to invest in the United States, if US lifts the remaining sanctions against Libya.
(Agence France Presse, 12 April 2005)

19 August 2005

US Senator and Chair of the Foreign Affairs Committee, Richard Lugar (R-IN), visits Tripoli. Moammar Gadhafi expresses frustration at the pace of normalization of bilateral relations. At the end of the visit, Seif el-Islam Gadhafi announces that Libya will be removed from the list of state sponsors of terrorism, provided that both sides make progress in addressing certain concerns.
(Agence France Presse, 19 and 23 August 2005)

19 September 2005

Relatives of UTA 772 flight victims, which exploded 9 months after the Lockerbie tragedy and for which Libya had also accepted responsibility, file a suit in a federal court in Washington, DC, against the government of Libya. (PR Newswire Europe, 19 September 2005)

20 December 2005

The Federal Reserve and US Treasury fine Dutch bank ABN Amro Holding NV $80 million for violating US anti-money laundering laws and sanctions against Iran and Libya. (Wall Street Journal, 20 December 2005, A3).

January 2006

Several European and American oil and gas companies negotiate return to Libya. (Agence France Presse, 30 December 2005; Gale Group Inc, 1 February 2006; Europe Information Energie, 12 January 2006; Aeronautique Business, 2 February 2006)

23 March 2006

The US Export-Import Bank announces that it is open for business with Libya. (Inside US Trade, Vol.24 N.12)

16 May 2006

US announces three new measures to normalize relations with Libya. The American liaison office in Tripoli will be upgraded to an embassy; Libya will be removed from the list of state sponsors of terrorism; and Libya will be removed from the list of states not fully cooperating with US antiterrorism efforts. (US State Department briefing, 15 May 2006)

July 2006

The United States removes Libya from the list of countries that sponsor terrorism. Libya still owes $2 million per victim but has removed funds earmarked for that payment from an escrow account in Switzerland due to expiration of the settlement agreement.
(International Herald Tribune, 8 July 2006, 3)

Goals of Sender Country

US Sanctions

December 1981
Administration officials emphasize that anti-Gadhafi strategy is not a response to assassination reports. Instead, they say strategy is linked "to a presidential decision, taken months ago, to devote major US efforts to the task of weakening the Gadhafi regime." (Wall Street Journal, 11 December 1981, 3, 31; Washington Post, 11 December 1981, A28)

August 1983
Anonymous administration official: "American policy for Libya is to get out of Chad. ... The Libyans should not be in Chad. We have to show the Libyans they cannot win in Chad. ..." (New York Times, 19 August 1983, A6)

January 1986
President Reagan cites conditions for lifting sanctions: "[Gadhafi] would have to reveal by action that he has severed those connections [Libya's financial support, provisions of training camps for terrorist] and is no longer backing these terrorists groups." (New York Times, 12 January 1986, A12)

December 1995
Senator Alfonse D'Amato (R-NY), Chairman, Senate Banking Committee and cosponsor of the Iran and Libya Sanctions Act: "We must answer the cry for justice by the families of the 270 victims of this terrorist attack [against Pan Am Flight 103], 189 of them Americans, with 35 from New York State. ... We must send the message that terrorism, sponsorship of terrorism, and those who subsidize terrorism will not be ignored. ... Libya, with a long and documented history of obscene violations of human rights and international law, must pay the price for its part in this slaughter and its past support for other international terrorist acts." (Congressional Record, 20 December 1995)

July 1996
President Bill Clinton, at the signing ceremony, declared that the Iran and Libya Sanctions Act "will help to deny [Iran and Libya] the money they need to finance terrorism. It will limit the flow of resources necessary to obtain weapons of mass destruction. It will heighten pressure on Libya to extradite the suspects in the bombing of Pan Am Flight 103." (Rose 143-44)

May 2000
Ronald E. Neumann, Deputy Assistant Secretary of State for Near Eastern Affairs:
"U.S. policy and policy goals vis-à-vis Libya have remained consistent through three Administrations. Our goals have been to end Libyan support for terrorism, prevent Tripoli’s ability to obtain weapons of mass destruction and contain Qadhafi’s regional ambitions. Since Lockerbie, we have added additional aims, including bringing the persons responsible to justice." (Testimony before the Senate Foreign Relations Subcommittee for Near Eastern and South Asian Affairs, USIS, 4 May 2000)

January 2001
White House Press Secretary Ari Fleischer: "The United States and the United Kingdom have made clear to the Government of Libya that the delivery of a verdict against the suspects in the Pan Am 103 trial does not in itself signify an end to UN sanctions against Libya. UN Security Council Resolutions call on Libya to satisfy certain requirements, including compensation to the victims' families and the acceptance of responsibility for this act of terrorism, before UN sanctions will be removed." (USIS, 31 January 2001)

August 2003
Secretary of State Colin Powell: "The lifting of sanctions at the United Nations will not affect U.S. bilateral sanctions on Libya, which will remain in place. We remain deeply concerned about other aspects of Libya’s behavior, including its poor human rights record and lack of democratic institutions; its destructive role in perpetuating regional conflicts in Africa; and, most troubling, its pursuit of weapons of mass destruction and their related delivery system. Libya also remains on the state sponsors of terrorism list, which carries its own sanctions. Libya must address the concerns underlying these bilateral measures. Libya must continue to take definitive action to assist in the fight against international terrorism.” (Department of State, Press Release, 15 August 2003)

February 2004
The White House Press Secretary: “… While more remains to be done, Libya's actions have been serious, credible, and consistent with Colonel Qadhafi's public declaration that Libya seeks to play a role in ‘building a new world free from WMD and from all forms of terrorism’…

As Libya continues to take steps that will lead to the complete dismantling of its WMD and MTCR-class missiles programs and adheres to its renunciation of terrorism, the United States will continuously evaluate the range of bilateral sanctions that remain in place relating to Libya.

The United States will approach relations with Libya on a careful, step-by-step basis. We have made clear that progress in our bilateral relationship will depend upon continued, good faith implementation by Libya of its own public commitments on WMD, missiles, and terrorism." (The White House, Statement by the Press Secretary, 26 February 2004)

UN Sanctions

In order for UN sanctions to be permanently lifted, Libya must:

  • cooperate with the Pan Am 103 investigation and trial
  • accept responsibility for the actions of Libyan officials in connection with that crime
  • pay appropriate compensation
  • commit itself to cease all forms of terrorist action and all assistance to terrorist groups

These requirements are spelled out in letters to the secretary general by the United States, United Kingdom and France. The letters are referenced in UN resolutions 731, 748, and 833 and constitute binding conditions for the removal of UN sanctions. (Katzman 57)

March 1992
United Nations Security Council Resolution 748: "The Security Council ... 1. Decides that the Libyan Government must now comply without any further delay with [the UN demands for extradition of the suspects in the Pan Am bombing] 2. Decides also that the Libyan Government must commit itself definitively to cease all forms of terrorist action and all assistance to terrorist groups and that it must promptly, by concrete actions, demonstrate its renunciation of terrorism. ..."

April 1992
UK Foreign Minister Douglas Hurd: "These [UN sanctions] are not punitive sanctions. They tackle exactly those areas of Libyan life which are part of the trouble. The trouble arose from air terrorism, so the action is against air traffic. It arose from arms, and therefore the action is against Libyan purchase of arms." (Washington Post, 16 April 1992, A33)

March 1998
US Ambassador to the United Nations Bill Richardson: "If Libya truly wants these [UN] sanctions lifted, its course of action is clear: Surrender the two suspects so they can receive a fair trial in the appropriate criminal court." (US Information Service, 20 March 1998)

March 1998
In order for UN sanctions to be permanently lifted, Libya must:

  • Cooperate with the Pan Am 103 investigation and trial
  • Accept responsibility for the actions of Libyan officials in connection with that crime
  • Pay appropriate compensation
  • Commit itself to cease all forms of terrorist action and all assistance to terrorist groups

These requirements are spelled out in letters to the Secretary General by the United States, United Kingdom and France. The letters are referenced in UN resolutions 731, 748, and 833 and constitute binding conditions for the removal of UN sanctions. (Katzman 57)

Response of Target Country

January 9, 1986
After imposition of unilateral US sanctions, Gadhafi warns "that continued American hostility toward his country would lead to 'more cooperation' between Libya and the Soviet Union." He adds that he may reassess Libya's policy denying base rights to Soviet ships in Libyan ports: "We may have to tip the balance in the Mediterranean if we feel we are threatened by a superpower such as the Americans." (New York Times, 10 January 1986, A1; Washington Post, 10 January 1986, A8)

January 15, 1986
Gadhafi in televised speech: "I declare that we shall train [Arab guerrillas] for terrorist and suicide missions and allocate trainers for them and place all the weapons needed for such missions at their disposal. I offer to the best of my ability to these volunteers, with the Palestinians at their head, my personal protection because Libya is a base for the liberation of Palestine. (New York Times, 16 January 1986, A8)

January 28, 1986
In proposal conveyed to Italian Prime Minister Bettino Craxi, Gadhafi offers to stop supporting terrorism if US promises not to attack Libya. Italian officials interpret move as "trying to open channels to the US and Italy in the hopes of ending the confrontation." (New York Times, 29 January 1986, A16)

October 1994
Libyan Foreign Minister Omar al-Muntasser: "If there is an oil embargo, we will have no revenue or job opportunities for the nationals of these countries, which have around one million workers in Libya. ... Even assuming that the two accused did commit the Lockerbie crime [i.e., the Pan Am 103 bombing], it is wrong to punish an entire people for the deed of two individuals." (Mideast Mirror, 14 October 1994)

December 1994
Libyan UN Ambassador Mohamed Azwai: "[The US and the UK] are neither interested in uncovering the truth nor in the suffering of the families of the victims. Their main concern, we believe, is to ostracize Libya, making it appear as a pariah and an outlaw state in the world community for purely political reasons." (Washington Post, 21 December 1994)

Libyan Foreign Minister Abdurrahman Shalgam: "Libyan's foreign minister made clear the calculations behind the Libyan offer [to the families of Pan Am victims]. Mr. Shalgam…said Libyan economists had calculated that Libya would recover the final settlement of $2.7bn in 20 months if both the UN and US sanctions were lifted. 'The unilateral sanctions have been very tough,' he said. 'We depend on oil. The most sophisticated equipment is in the US, so is the technology, the skills. We used to send our own young people to study in the US. Now we don't have that possibility. We have $1bn in assets frozen with America. And we cannot invest in stocks there.' Libya's strategic goal, he said, was to raise oil production from 1.2m barrels a day to 3m over the next 15 years, and the return of American oil companies could save Libya as much as 20 cents a barrel. But that would never happen as long as the Lockerbie families continued to lobby in the US Congress to keep the sanctions in place. 'We want to rehabilitate our civil aviation industry and expand our oil investments. … And for all this we need American technology.' " (Financial Times, 28 October 2003, 15)

2 January 2006
M. Gadhafi interviewed by Al Jazeera (text reproduced by BBC): "With regard to Libya, it tried after the revolution—just like all other countries—to enter the nuclear weapons race and manufacture a nuclear bomb. That happened decades ago, but now things have changed. The world and alliances have changed. If Libya manufactures a nuclear bomb, who will it use it against? Which enemy will Libya use a nuclear bomb against? There is no such enemy. Therefore, why should we spend money on such a programme? Such a programme also brings problems to our country and may threaten its security more than protect it. Who will Libya use a nuclear bomb against? We could not find an answer to this question. Therefore, why should we [develop it]? Accordingly, we voluntarily cancelled our programme to manufacture a nuclear bomb." (BBC, 2 January 2006)

Attitude of Other Countries

"France banned sales of new weapons systems to Libya after demonstrators burned down its embassy in 1980, although it still provides spare parts for the French-built Mirage fighter planes and other equipment used by the Libyan military." (New York Times, 11 January 1986, A4)

"Although France has also reacted with concern to Libyan moves in Africa, it has refused in part for economic reasons to treat Colonel Gadhafi as a pariah. It buys oil from Libya and argues that it is important to keep lines of communication open with the Libyans. In addition to this specific difference, President François Mitterrand of France has sought to distance his policy toward Chad from Washington's. But American officials in the White House, Pentagon, and State Department all said today that American and French policy has been closely coordinated." (New York Times, 19 August 1983, A6)

West Germany
In January 1986, West Germany rejects US calls for sanctions, which it characterizes as "not a suitable instrument." Continuing German opposition to sanctions is also tied to presence of 1,500 German workers in Libya. It is later revealed, however, that West German firms played "major role" in construction of chemical plant in Libya widely suspected of being used to produce chemical weapons. (New York Times, 4 January 1986, 1; 10 January 1986, A6; 8 March 1990, A17; Washington Post, 4 January 1986, A15)

United Kingdom
Following murder of London policewoman by machine gun fire from inside Libyan embassy in April 1984, UK breaks diplomatic relations with Libya, bans arms exports, restricts government export credit guarantees. (Washington Post, 4 January 1986, A15; New York Times, 17 January 1986, A3)

Sir Geoffrey Howe, British Foreign Secretary, indicates that UK will not join US economic sanctions, but "will continue to urge the European allies to isolate Libya diplomatically and militarily." (New York Times, 17 January 1986, A3)
In January 1986, Italy bans arms sales to Libya, takes steps "to prevent Italian companies from taking over business from Americans who withdraw because of the United States economic sanctions." It emphasizes, however, that further measures should only be taken jointly by all members of European Community. At same time, Italian leaders express concern "that Mr. Reagan's policies on Libya might harm the chances of a negotiated peace settlement in the Middle East." (New York Times, 10 January 1986, A1, A6)

Belgium, Luxembourg
Private trade mission representing 14 companies goes ahead with its visit to Libya in late January 1986, noting that "if the Americans leave, many companies will be interested in replacing them." (New York Times, 11 January 1986, A4)

Italian Ambassador to the United States Ferdinando Salleo and EU Ambassador Hugo Paeman
"Libya has been the subject of sanctions measures imposed by the Security Council of the United Nations. Any unilateral action which aims at imposing further measures outside that context can only undermine the authority of the economic sanctions agreed upon in the [UN] resolutions. ... If the US government wishes further measures to be implemented by the international community, it should introduce them for discussion in the relevant international body. ... This way of unilaterally attempting to impose penalties on third parties disturbs international trade and investment relations and depreciates the standing of internationally accepted fora for any such measures." (International Trade Reporter, 7 February 1996, 219)

In response to US sanctions in January 1986, Canada suspends insurance coverage subsidies for companies operating in Libya, bars new contracts to export advanced oil-drilling equipment to Libya, acts to "block any attempts by Libya to obtain technical assistance through Canada that was denied by the United States." No action is taken, however, against Canadians who seek to replace US workers forced to leave Libya. (New York Times, 11 January 1986, A5; Washington Post, 11 January 1986, A18)

Organization of Petroleum-Exporting Countries
On 12 December 1981, OPEC ministers reject Libyan appeal for "joint action" against US. (Washington Post, 12 December 1982, A1)

Islamic Conference, Arab League
In January 1986, 45-member Islamic Conference unanimously passes resolution denouncing US sanctions, calls on its members "to take the necessary actions deemed appropriate to counter these oppressive American measures." However, conference fails to approve call for economic sanctions against US. (New York Times, 22 January 1986, A4; Washington Post, 31 January 1986, A25)

Organization of African Unity
"In a June 8 [1998] resolution, the Organization of African Unity heads of state called on African nations to suspend compliance with UN Security Council sanctions on Libya immediately, for religious and humanitarian reasons, on OAU-related Libyan flights, and to ignore sanctions entirely beginning in September if the U.S. and UK have not by then agreed to one of Qadhafi's third-country trial options." (US Department of State, 10 June 1998)

South Africa
South African President Nelson Mandela dismisses US opposition and travels to Libya to show his appreciation for Gadhafi's support in the struggle against apartheid. Mandela states that South Africa supports the Organization of African Unity's call for a trial in a third country for the Pan Am suspects. (Washington Post, 23 October 1997, A27)

Economic Impact

Observed Economic Statistics

US sales of small aircraft, helicopters, aircraft parts, avionics to Libya in 1980 total $7.58 million (GAO 1987)

US oil imports from Libya before March 1982 are approximately 150,000 bbl per day because of recession (down from 700,000 bbl per day in 1981). US oil company assets in Libya at end of 1981 are valued at $500 million. (Schott 16-18)

Shrinking oil receipts put pressure on Libyan budget, since oil accounts for almost all of Libya's exports earnings. Despite severe shortages of food and consumer goods in 1985, Gadhafi orders cut in 1986 budget for imports to leave more money for capital projects; military budget is estimated at $2 billion, or about 40 percent of projected oil income. (New York Times, 29 January 1986, A16; New York Times, 2 May 1986, D1; Schumacher 340)

Budget squeeze in 1985 forces cancellation of $4.2 billion Soviet nuclear power plant, more than $1 billion in housing, road projects, $700 million in military construction projects. (Schumacher 344, 337)

All but one US oil company temporarily suspended exports of Libyan crude following announcement of US sanctions in January 1986; however, level of production is reportedly maintained by European oil companies in Libya. Prior to sanctions US companies account for one-third of Libyan production of 1.2 million bbl per day. Action is also related to plunge in spot oil prices from $25 per bbl to $17 per bbl in mid-January before rebound to about $20 per bbl. (New York Times, 29 January 1986, A16; Washington Post, 30 January 1986, A1)

Treasury estimates, on basis of cash flow analysis, value of US oil concessions, other assets in Libya at "more than $1 billion." However, Occidental Petroleum, largest US operator in Libya, reports that its Libyan assets of $120 million amount to only 1 percent of its worldwide total. (New York Times, 6 May 1986, A14)

In 1986 Libya is in arrears on $3 billion to $4 billion in loans from Western countries; Italy, Libya's largest creditor, agreed in 1984 to an oil barter arrangement to reduce Libyan debt. In addition, Libya owes about $4 billion to USSR for military equipment. (Financial Times, 22 April 1986, 4)

As of May 1987, "the impact on the Libyan oil and petrochemical industry has been minimal. ... The departure of US oil companies from Libya has had little effect because the oil previously produced and sold by these companies is now produced and marketed by the Libyans, providing them with additional revenues. ... [P]roduction levels of Libyan crude oil have remained about the same as they were before the imposition of the sanctions. ... In addition, the extensive foreign availability of oil field equipment, supplies, and services allows Libya to meet its oil industry needs without having to rely on US oil equipment, supplies, and servicing companies. (GAO 1987, 2-3)

Libya receives 98 percent of its foreign income from oil sales. Europe (Germany, Spain, and Italy) is the largest destination for Libyan crude. (New York Times, 12 November 1993, A10)

As of January 1998, net blocked Libyan assets in the US amount to $966.1 million. (US Department of the Treasury, Office of Foreign Assets Control [OFAC], Terrorist Assets Report, January 1998, 5)

"UN sanctions imposed in April 1992 have not yet had a major impact on the economy because Libya's oil revenues generate sufficient foreign exchange that, along with Libya's large currency reserves, sustain food and consumer goods imports as well as equipment for the oil industry and ongoing development projects. In 1994, Libya's imports totaled $6.9 billion, compared to exports of $7.2 billion (f.o.b. estimated). The sanctions have, however, had an effect in painting Libya as a rogue state" (US Department of Commerce, Bureau of Export Administration, 1997, Annual Report, III-224)

"The main victim of the [UN] sanctions might have been the European industry. In 1992, Italy sold $1 billion of petroleum equipment to Libya, Germany $610 million, UK $400 million and France $319 million. Despite the embargo, Libya is likely to find alternative suppliers, such as Iran. ... Nevertheless, sanctions will have a substantial cost through the increase of overall transportation costs. Goods previously shipped by plane arrive now in Libya by land via Tunisia or by boat via Malta. According to some estimates this will quadruple prices of shipment." (Marchés Tropicaux, 16 December 1994, 2611)

"The National carrier, Libyan Arab Airlines, has been doubly hit by an air embargo and a spare parts embargo. While it still operates limited domestic flights, 21 out of its total fleet of 31 aircraft have been grounded due to lack of spare parts. The airline's chairman recently said that the air and spare parts embargoes had cost the airline $900 million since 1992." (Economist Intelligence Unit Country Report-Libya, 2nd quarter 1997)

"The only positive [economic] effect of the embargo consists of the import ban of weapons, greatly diminishing Libyan military expenditures. In 1989, Libya purchased $499 million of military equipment." (Marchés Tropicaux, 16 December 1994, 2611)

"The effect of the UN resolution on exporting oil would appear to be minimal. It bans the sale to Libya of pumps and other paraphernalia used in the loading of crude oil and products for shipment abroad. But presumably Libya is not finding it difficult to overcome this prohibition as the equipment in question such as anchor chains is neither unusual nor sophisticated. The UN resolution carries more bite on downstream activities by forbidding the export to Libya of specific items needed in refining as well as of licenses for refining processes. The items involved are described in terms of US American Petroleum Institute or American Society of Mechanical Engineers Standards and it seems conceivable that substitutes exist which are not covered by the UN list, although these may not be of the highest standard. The blacklisting of catalytic reactors and prepared catalysts is important as the licenses for constructing such reactors are held by American companies. The ban on Libya's acquisition of them means that the country will continue to be unable to upgrade its refineries to make more gasoline for internal consumption." (Gurney, 220-221)

"The sanctions are a nuisance to both government and population. They have delayed some investment in the oil industry and contributed to a rise in inflation by increasing the cost of imports. But it is Colonel Gaddafi's economic policies and the fall in oil prices that have led to a deterioration in day to day economic life." (Financial Times, 17 July 1996, 4)

"The UN freeze of funds held abroad by Libyan public authorities or by any Libyan undertaking was intended to restrict downstream and other financial investment in Europe by the Libyan government or NOC [national oil company]. ... The initial effect of this restriction on existing Libyan downstream activities in Europe was forestalled by the Libyan government reducing its holdings in companies involved in these functions. In the mid-1990's it appeared that, although its equity stake had been reduced in such operations, Libya was continuing to play a significant role in the direction of these companies as a result of their dependence on quality Libyan crudes in their refineries. Presumably, this will continue." (Gurney, 220-221)

"Sanctions have also put an effective stop to privatization and to any liberalization of the economy and trade. Privatization Law No. 9, of September 2, 1992, has not been implemented because the state has tightened its control over the economy to deal with the sanctions." (Economist Intelligence Unit Country Report-Libya, 2nd quarter 1995, 18)

"The World Bank estimated that sanctions have cost Libya as much as $18 billion in lost revenue, mostly as a result of underinvestment in oil." (Economist, 13 March 1999, 56)

"Libya estimates that the sanctions have deprived its economy of $33 billion, whereas the World Bank puts the damage at the lower but still daunting sum of $18 billion." (Takeyh 64)

"Already, in the 1980s, low oil prices had sparked an economic recession from which Libya could not escape. The sanctions of the 1990s then exacerbated the woes of an economy that was plagued with 30 percent unemployment and 50 percent inflation rates. Tripoli embarked on an austerity program, freezing salaries and reducing subsidies, but this proved dangerous for a regime that depended for its survival on buying the population's acquiescence." (Takeyh 65)

Libya: Trade with United States and total trade, 1980-88 (millions of dollars)

Year US exports to Libya US imports from Libya Total Libyan exports Total Libyan imports

1980 509 8,905 21,919 6,776
1981 813 5,476 15,575 8,382
1982 301 533 13,300 8,608
1983 191 1 12,116 7,730
1984 200 10 10,655 7,058
1985 311 47 10,897 5,488
1986 46 2 6,204 4,607
1987 - - 6,878 5,142
1988 - - 6,793 6,225
1989 - - 8,617 4,393
1990 - - 13,878 5,663
1991 70 - 11,212 5,339
1992 70 - 9,942 5,164
1993 - - 7,535 5,370
1994 - - 7,790 4,153
1995 - - 8,465 4,850
1996 - - 10,033 5,137
1997 - - 9,910 5,597
1998 - - 6,032 5,600
1999 - - 7,961 4,253
2000 18 - 12,716 4,018
2001 9 - 11,337 4,425
2002 18 - 9,879 5,517
2003 - - 13,763 6,102
2004 39 346 19,314 8,120

Source: IMF, Direction of Trade Statistics Yearbooks, 1995, 1996, 2005; Direction of Trade Statistics Quarterly, June 1998.

Libya: Petroleum exports, revenues, and prices, 1985-2004

Crude oil exports
(1000 barrels / day)
Value of petroleum exports
(billions of dollars)
Libyan crude
(Brega spot price
per barrel, $)

1985 880 12 27.79  
1986 1,051 8 14.31  
1987 804 6 18.08  
1988 882 6 14.72  
1989 868 7 18.21  
1990 1,300 10 23.82  
1991 1,445 10 20.41  
1992 1,370 9 19.54  
1993 1,270 7 17.08  
1994 1,285 8 15.91  
1995 1,310 7 17.21  
1996 1,295 10 21.06  
1997 1,116 9 19.36  
1998 1,161 6 12.90  
1999 992 8 18.08  
2000 1,005 12 28.65  
2001 988 11 24.70  
2002 984 10 24.96  
2003 1,127 14 29.00  
2004 1,285 19 38.35  

Sources: OPEC Annual Statistical Bulletin, 1996, 2004; CIA Handbook of International Statistics, 1996.

Libya: Arms imports, 1986-1999

Arms imports
(millions of dollars)


Sources: Arms Control and Disarmament Agency, World Military Expenditures and Arms Transfers, 1997; Bureau of Verification and Compliance, World Military Expenditures and Arms Transfers, 1999-2000.

Libya: Balance of payment statistics, 1984-2004 (millions of dollars)

Year International transportation account International travel account

  Receipts Expenses Receipts Expenses


Source: IMF, Balance of Payments CD, June 2006.

Calculated Economic Impact (annual cost to target country)

US v. Libya (annual cost to target country)

Period I: 1981-85  
Cutoff of US imports of 150,000 bbl per day of Libyan oil; with no reduction in overall Libyan exports, cutoff forces Libya to discount price by estimated 10 percent (or $3.70 per bbl)-of which 5 percent is attributable to market forces, 5 percent to sanctions $101 million
Reduction in nonoil US-Libyan trade as result of export, import controls; welfare loss estimated at 30 percent of face value of trade (including welfare cost of blocked US exports of sensitive oil, gas field technology) 10 million
Withdrawal of US citizens from Libya; estimated 10 percent increase in estimated $75,000 average annual salary to hire non-US oil field workers to replace about 750 US employees who leave 6 million
Suspension of sale of Boeing jets to Libya; welfare loss estimated at 10 percent of value of trade 60 million
Sale of Exxon's Libyan assets to Libya for less than book value ($121 million v. $95 million settlement); welfare gain valued at 100 percent of difference ($26 million)
Average Annual Cost, 1981-85 $151 million
Period II: 1986-98  
Reduction in US trade with Libya as result of embargo; welfare loss estimated at 30 percent of drop in trade from average annual value in 1983-85 $253 million
Freeze of Libyan assets in US; welfare loss estimated as 10 percent of face value of assets frozen $97 million
Average Annual Cost, 1986-2004 $350 million
Average Annual Cost, 1981-2004 $309 million

UN v. Libya (annual cost to target country, 1992-2003)

Reduction in trade resulting from UN embargo on aircraft and parts; welfare loss estimated at 50 percent of reduction in value of imports in 1993-96 compared to 1988-91 $7 million
Increased prices for petroleum refining and loading equipment resulting from UN ban on selected items; welfare loss estimated at 5 percent of the 1992 value of European exports of petroleum equipment to Libya $115 million
Reduction in trade resulting from UN arms embargo, welfare loss estimated at 10 percent of average annual volume of imports in 1988-91 $70 million
Increased travel and transportation costs due to air ban; welfare loss calculated at 10 percent of value of average annual travel and transportation imports, 1988-90 $90 million
Nonoil assets frozen Negligible
Total, UN sanctions $282 million

Relative Magnitudes: Impact of US Sanctions

Gross indicators of the Libyan economy  
  • GNP (1978)
    Population (1978)
$18.3 billion
2.7 million
Annual effect of US sanctions related to gross indicators
  • Percentage of GNP
    Per capita


Libyan trade with US as percentage of total trade  
  • Exports (1980)
    Imports (1980)
Ratio of US GNP (1978: $2,164 billion) to Libyan GNP 118

Relative Magnitudes: Impact of UN Sanctions

Gross indicators of the Libyan economy  
  • GNP (1992)
    Population (1992)
$30.6 billiona
4.9 million
Annual effect of UN sanctions related to gross indicators
  • Percentage of GNP
    Per capita


Libyan trade with UN members as percentage of total trade
  • Exports (1992)
    Imports (1992)
Close to 100
Close to 100
Ratio of UN members' GNPb (1992: $18,400 billion) to Libyan GNP 601

a. CIA number for 1993, PPP method used as estimate.
b. Combined GDP of member countries of the Organization for Economic Cooperation and Development (OECD) used as estimate.
Source: OECD.



Geoffrey Kemp, former National Security Council staffer
"If the American goal is to topple the Gadhafi regime altogether, then sanctions won't do the job. But if the US has the more modest goal of deterring Gadhafi from his most egregious actions, then sanctions might be successful. ... Reducing Gadhafi's oil revenues wouldn't reform his character, but it would surely force him to cut back on development, arms purchases and funds for terrorists. The question, as always, is whether our European allies will cooperate." (Washington Post, 12 January 1986, D1)

Edward Schumacher
"Indeed, the April 1986 raid on Libya brought a lull in Arab-related terrorism. And the governments of Western Europe, scarcely supportive of the American show of force, nevertheless imposed sanctions, in part to placate the Americans. The sanctions prompted the departure of more than 600 Libyans from Western Europe, thus dismantling a logistical network for terror. ... The lull in terrorism was short-lived." (Schumacher 329)

Washington Post
"Four year after US warplanes bombed Gadhafi's house [in Tripoli] for his alleged support of terrorism, the Libyan leader seems eager to play the powerful penitent who can persuade Palestinian terrorist Abu Nidal to free hostages and can mediate between hard-liners in the Arab world. Gadhafi's drive for Western acceptance is fueled largely by a realization that he has lost the generous support—including military advisers and arms—that he once enjoyed from the Soviet Bloc. ... But Gadhafi has not turned his back on revolutionary causes. ... Rebels who espouse 'anti-imperialist' causes are still regular guests here. And recently two Libyan diplomats were expelled from Ethiopia for allegedly planting bombs aimed at an Israeli envoy." (Washington Post, 27 May 1990, A35)

George Moffett
"As much as Gadhafi would like to break out of the sanctions, he is unable to pay the asking price by extraditing the bombing suspects for trial in Scotland where they would be accessible to questioning by US and British intelligence. If Gadhafi turned over the two agents, he would almost certainly weaken the morale of the Libyan internal security forces at a time when he needs them most." (Christian Science Monitor, 9 November 1994, 1)

Suleiman Bengharsa
"The unilateral sanctions regime imposed by the US on Libya has had no major negative economic effects on that country. The reason is an obvious one: a unilateral sanctions regime cannot work if what has been sanctioned by one country can be purchased form another or a variety of other countries. ... Overall, UN sanctions have helped to further ostracize and isolate the Gaddafi regime." (Bengharsa 1996, 2, 7)

Gideon Rose
"To judge the wisdom of employing sanctions in any particular case, one must answer two separate questions: How effective particular sanctions are likely to be in the circumstances at hand and how they compare to other potential policy options. The sanctions against Libya fare poorly on the first count but well on the second. ... [In this case,] limited sanctions have represented an acceptable middle course, one yielding modest benefits for a modest price. They have helped to manage a difficult foreign policy challenge if not to master it.

"The years of sanctions have hobbled Libya's conventional military capability, grounded its air force, and crimped its weapons of mass destruction (WMD) programs. All this has substantially reduced the threat Qaddafi poses to his neighbors and the world at large, at least compared to what would have been the case had he been allowed to carry on business as usual.

"The U.S. shift to extraterritorial sanctions against foreigners doing business in Libya, on the other hand ... violates this prudent calculus by needlessly picking a potentially major fight with important allies. ... However the transatlantic fight over Helms-Burton and ILSA [the Iran and Libya Sanctions Act] is resolved, the latter Act's Libyan-related sections are wrong-headed simply because they raise the priority and costs of Libya policy far above what is appropriate, given the full range of American global foreign policy interests." (Rose 145-46)

Financial Times
"The key to resurrecting the Lockerbie case was the US and British decision-in a UN resolution last August-to agree to Col. Gadaffi's long-standing proposal that the two suspects be tried in a neutral country rather than in Scotland. ... [Also, w]ith oil prices falling, the sanctions on Libya, although far from the comprehensive embargo imposed on Iraq, were biting. Money was running out. ... [B]y banning travel, arms sales, purchases of some oil equipment and imposing a freeze on certain assets, the sanctions deprived the oil industry of much needed development and complicated management of the economy by raising the cost of most transactions." (Financial Times, 6 April 1999, 12)

Wall Street Journal
"As we've often said, sanctions are blunt instruments that rarely have the intended consequence and more often injure those most victimized by a despot's reign. The Libyan sanctions were a rare exception to that rule largely because most of the civilized world united behind the limited sanctions imposed by the United Nations." (Wall Street Journal, 7 April 1999, A22)

David Cortright and George A. Lopez
"On balance, UN sanctions can be rated a partial success. The limited sanctions on travel, oil equipment, and finance did not have major economic impacts, but they were sufficiently burdensome to encourage the search for a negotiated settlement of the dispute. By themselves sanctions did not resolve the dispute, but they provided a crucial bargaining framework around which a final settlement could be reached. More important, sanctions encouraged the Libyan government to reduce involvement in the underworld of terrorist violence and served as an effective deterrent against the government's support for international terrorism." (Cortright 120-121)

Ray Takeyh, Soref Research Fellow at the Washington Institute
for Near East Policy

"..[T]hat Qaddafi surrendered the suspects [in bombing of Pan Am flight] suggests that international pressure has prompted subtle yet significant changes in his foreign policy.

"The colonel had long believed that Libya's oil wealth and commercial appeal would undermine any cohesive opposition to his revolutionary excesses. But the Lockerbie sanctions, enacted by the United Nations in 1992, shattered that conviction. The United States managed to convince even states with close economic ties to Libya, such as Italy and Germany, to support the sanctions as a way to force Qaddafi to hand over the bombing suspects.... For the first time, Qaddafi's militancy incurred a palpable cost.

"...U.N. sanctions - particularly the prohibition on the sale of oil equipment and technology and a ban on financial transfers - hit Qaddafi where it hurt the most, undermining his government's ability to extract and export its main source of revenue." (Takeyh 63-64)

Ray Takeyh, National Defense University
"What forced Gaddafi to act was a combination of things—U.N. sanctions after the Lockerbie bombing, his international isolation after the Soviet Union's collapse . . . and internal economic problems that led to domestic unrest by Islamists and forces within the military." (Washington Post , 20 December 2003, A1, A18)

Gary Samore, Institute for Strategic Studies in London
"The disarmament agreement with Libya is a dramatic victory for traditional non-proliferation diplomacy—the use of incentives and sanctions to persuade governments to abandon weapons of mass destruction programmes in exchange for political and economic rewards." ( Financial Times , 22 December 2003, 11)

Joseph Cirincione, Carnegie Endowment for International Peace
"It's [the disarmament agreement] not a dramatic turn around. It's part of a trend that has been underway for 10 years—of reforms and trying to reintegrate with Europe, mainly for business reasons. . . . Gaddafi has turned away from radical Arab nationalism of the 1970s and 1980s toward programs geared toward economic development that require Western investment and markets, which means coming into line with international norms." (Washington Post , 20 December 2003, A18)

Financial Times
"The US has sought to portray Libya's unexpected announcement on Friday as a result of the Iraq war. But the Libyan shift was part of a long and systemic process that Col. Gadaffi . . . has consistently pursued since the early 1990s. . . . Driven above all by a need to secure the survival of his regime, Col. Gadaffi realized after the 1986 US bombing of Libya—and even before US and United Nations sanctions were imposed—that his role as sponsor of rebels and terrorists carried too high a price." (Financial Times, 22 December 2003, 3)

Flynt Leverett
". . . Libya was willing to deal because of credible diplomatic representations by the United States over the years, which convinced the Libyans that doing so was critical to achieving their strategic and domestic goals. Just as with Lockerbie, an explicit quid pro quo was offered: American officials indicated that a verifiable dismantling of Libya's weapons projects would lead the removal our own sanctions, perhaps by the end of this year. The lesson is incontrovertible: to persuade a rogue regime to get out of the terrorism business and give up its weapons of mass destruction, we must not only apply pressure but also make clear the potential benefits of cooperation." (New York Times , 23 January 2004, A25)

Geoff D. Porter
“. . .[T]wo decades of American and United Nations sanctions diminished Libyan oil revenues. The country's oil fields were declining, exploration was all but halted, and Libya was forbidden to import new oil extraction technology. At the same time, Libya's population was booming. . . .The mixture of population growth and declining oil revenues endangered Colonel Qaddafi's ability to hold on to power. Starting in the mid-1990's a younger generation of reformers…began to convince Colonel Qaddafi the he could not maintain his rule without more income. With virtually no other resources, increasing oil revenue was the only option, but to do this Colonel Qaddafi needed sanctions lifted. The steps that he took in regard to the Lockerbie bombing, the UTA flight and finally the renunciation of weapons of mass destruction were all aimed at removing sanctions. . . . Colonel Qaddafi brought Libya in from the cold not because he was afraid that the United States might toople him, but because he was afraid of losing his grip on power domestically.” (New York Times , 31 July 2004, A17)

Author's Summary

US v. Libya

Overall assessment  

Policy result, scaled from 1 (failed) to 4 (success)


Sanctions contribution, scaled from 1 (none) to 4 (significant)


Success score (policy result times sanctions contribution) scaled from 1 (outright failure) to 16 (significant success)

Political and economic variables  

Companion policies J (covert), Q (quasi-military), R (regular military)


International cooperation with sender, scaled from 1 (none) to 4 (significant)


International assistance to target A (if present)


Cooperating international organizations


Sanction period (years)


Economic health and political stability of target, scaled from 1 (distressed) to 3 (strong)


Presanction relations between sender and target, scaled from 1 (antagonistic) to 3 (cordial)


Regime type of target, scaled from 1 (authoritarian) to 3 (democratic)


Type of sanction X (export), M (import), F (financial)


Cost to sender, scaled from 1 (net gain) to 4 (major loss)


UN v. Libya

Overall assessment  

Policy result, scaled from 1 (failed) to 4 (success)


Sanctions contribution, scaled from 1 (none) to 4 (significant)


Success score (policy result times sanctions contribution)scaled from 1 (outright failure) to 16 (significant success)

Political and economic variables  

Companion policies J (covert), Q (quasi-military), R (regular military)


International cooperation with sender, scaled from 1 (none) to 4 (significant)


International assistance to target A (if present)


Cooperating international organizations


Sanction period (years)


Economic health and political stability of target, scaled from 1 (distressed) to 3 (strong)


Presanction relations between sender and target, scaled from 1 (antagonistic) to 3 (cordial)


Regime type of target, scaled from 1 (authoritarian) to 3 (democratic)


Type of sanction X (export), M (import), F (financial)


Cost to sender, scaled from 1 (net gain) to 4 (major loss)



Gadhafi’s recent decision to disclose and dismantle Libya’s weapons of mass destruction (WMD) programs seems part of a long-standing effort to improve relations with the United States and the United Kingdom and end the country’s international isolation.

Several factors influenced Libya’s change in policies. Internal economic problems caused by decades of economic mismanagement and declining oil production threatened the legitimacy of his regime. US and UN economic sanctions following the Lockerbie bombing exacerbated these difficulties and hampered efforts to revive the economy. The need for foreign investment, particularly in the oil sector, certainly played a role in Gadhafi’s decision to seek improved relations with the West. Intense diplomatic efforts on the part of South African President Nelson Mandela, UN Secretary General Kofi Annan, and others also were important in launching negotiations between the United States, the United Kingdom, and Libya in the late 1990s. These negotiations led to the compromise allowing for the surrender of two suspects in the Pan Am bombing, agreements on compensation for the families of the victims of the Lockerbie and UTA bombings, and Libya’s admission of guilt and renunciation of terrorism.

Similarly, Gadhafi’s decision to renounce WMD reflected a desire to benefit from the return of US oil companies and US technology and know-how. Nevertheless, given the renewed interest of European companies and others to invest and trade with Libya after the suspension of UN sanctions in 1999, unilateral US sanctions were not the only factor at work in the WMD decision. Libya concluded that WMD development was neither politically nor economically advantageous and posed a major obstacle to ending the country’s international isolation. Diplomatic channels and relationships developed during years of trilateral negotiations over Lockerbie were critical for the launch of talks on WMD. After WMD negotiations began, the Bush administration’s policy of preemptive war, exemplified in Iraq, and the success of US-led interdiction initiatives aimed at interrupting trade in illegal goods amplified the speed and extent of Libyan concessions.

Hence we conclude that US sanctions made a modest contribution to Libya’s renunciation of terrorism and WMD. Our preliminary scoring of the policy outcome (a score of 3) reflects the fact that at the time of this writing it remains to be seen whether Gadhafi will follow through on promises made. If US demands for verifiable dismantlement of Libya’s WMD programs are met in the coming months and sanctions lifted, then a score of 4 (success) would be justified. The US goal of destabilizing Gadhafi has been abandoned, given the regime’s substantial changes in policy.

Targeted but multilateral UN sanctions against Libya succeeded more quickly, contributing at least modestly to Libya’s decision to surrender Pan Am suspects, offer compensation to the families of the victims, and renounce terrorism.


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