The US late on Friday confirmed that Libya has paid US$1.5 billion into a US-controlled account to compensate US victims of a 1988 terrorist attack and other attacks, saying the step had removed “the last obstacle to a normal relationship between the United States and Libya.”
“We will work on that now going forward,” David Welch, assistant secretary of state for near east affairs, said in a briefing.
The payment follows the meeting in September in Tripoli between US Secretary of State Condoleezza Rice and Libyan leader Muammar Qaddafi, who formally ended a half century of hostility.
US and Libyan relations began warming in 2003 when Qaddafi agreed to give up weapons of mass destruction programs and denounce terrorism.
The US subsequently ended sanctions, removed oil-rich Libya from its terrorist blacklist and re-established diplomatic relations.
The groundwork for Friday’s announcement was finalized in August, when Libya agreed to provide hundreds of millions of dollars into the fund to compensate the families of those who died in the 1988 bombing of a Pan Am flight over Lockerbie, Scotland, and two US soldiers killed in the 1986 bombing of a Berlin disco.
The agreement on the money means cases before US courts will be dismissed and that Libya will have its immunities restored before US courts, Welch said.
The US decision to restore ties has angered families of the Pan Am victims who still regard Qaddafi as a murderer who should not benefit from positive relations with Washington.
The US$1.5 billion is to be shared among more than 400 victims, mostly American, of about a dozen terrorist attacks in the 1980s, including the relatives of the 270 people killed on Pan Am Flight 103, the New York Times reported.
Earlier on Friday, convicted Lockerbie bomber Abdelbaset Ali Mohammed al-Megrahi applied for interim liberation pending the outcome of an appeal, British media reported.
The former Libyan intelligence agent, age 56, is suffering from prostate cancer and was temporarily transferred from his prison cell in Greenock, Scotland, last month to hospital.
Al-Megrahi is serving a life sentence for the Pan Am bombing.
Meanwhile, Qaddafi, making his first visit to post-Soviet Russia, hopes to clinch a series of major arms deals in another sign of strengthening ties between the Cold War allies.
A leading Russian newspaper also reported that Qaddafi, whose three-day visit began on Friday, was prepared to offer Russia’s navy access to Libya’s Mediterranean port of Benghazi. The newspaper said Qaddafi, fearing another US attack, favors a Russian military presence in Libya.
Russia has moved significantly to rebuild ties with Russia that withered after the 1991 Soviet collapse.
During a visit in April, then Russian president Vladimir Putin agreed to write off US$4.5 billion in Libyan debt in exchange for lucrative deals in energy and arms. In return, Russia landed a US$2.8 billion contract for state-owned Russian Railways and Russia’s gas monopoly Gazprom signed a deal to develop six prospective oil and gas fields in Libya.
The Interfax news agency said on Friday that prospective deals under discussion include the Libyan purchase of S-300, Tor-M1 and Buk-M1 air defense missile systems, two squadrons of Su-30 and MiG-29 fighter jets, several dozen combat helicopters, tanks, rocket launchers and a diesel submarine.
Interfax said Russia also plans to sign contracts to modernize aging Soviet-era weapons in Libyan arsenals which lack spare parts.
A Kremlin official, who spoke on condition of anonymity because of the sensitivity of the talks, said on Friday that Russia and Libya could even cooperate in the peaceful use of nuclear energy, but wouldn’t give details.
The leading business daily Kommersant reported on Friday there had been no breakthrough on weapons deals in the runup to Qaddafi’s visit.
But it said an offer to allow Russia ships to use the Libyan port of Benghazi would soothe Moscow’s irritation over slow progress in the weapons talks.
“During these talks the colonel intends to raise the issue of opening a base for Russia’s navy in the Libyan port of Benghazi,” the paper wrote.
Russia has sought to revive a naval presence in the Mediterranean and has looked toward historical allies in the region, such as Syria, as potential bases or ports. A Russian naval squadron on its way to the Caribbean recently stopped in Tripoli.
“The Libyan leader thinks that a Russian military presence will serve as a guarantee against an attack from the United States, which, despite all its conciliatory gestures, isn’t in a hurry to embrace Gadhafi,” Kommersant wrote.
Kremlin officials refused to comment on the report.
Kommersant said Libya also urged the Kremlin to back plans for a natural gas cartel that would involve Algeria, Qatar, Libya, the countries of Central Asia and perhaps Iran. Such an OPEC-like organization would strengthen Moscow’s energy leverage over Europe.
Earlier this month, Russia, Iran and Qatar made the first serious moves toward forming such a grouping.
Russia faces competition from Ukraine for supplying arms to Libya. Qaddafi is expected to visit Ukraine after his trip to Russia.
Qaddafi met with Russian President Dmitry Medvedev for dinner on Friday.
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