Libyan National Army (LNA) forces have withdrawn from their forward positions on the southern outskirts of Tripoli, retreating primarily to Al-Jufra Airbase in central Libya. LNA General Command Lieutenant General Ahmed Al-Mismari described this as a “strategic withdrawal” and added that it was part of a redeployment operation. His statement, released 19 May, came a day after the LNA lost the strategic Watiya Airbase in western Libya to militias fighting for the Tripoli-based Government of National Accord (GNA) which have been bolstered by Turkish military support on the basis of a controversial military cooperation agreement signed between the GNA and Ankara on 27 November 2019. With the loss of Watiya, the LNA only now holds the Tripoli International Airport to the east of the capital and Qasr Bin Ghashir and Tarhouna to the south and southeast. The latter, a major LNA stronghold, has been under heavy siege by Turkish-backed GNA forces. As the fighting continues, regional and international parties have stepped up their pressures on the warring parties to conclude a ceasefire and resume the negotiating process that ground to a halt following the resignation of former UN envoy for Libya Ghassan Salame and the onset of the Covid-19 pandemic. On 23 April, the Spokesman for the Tobruk-based House of Representatives Aguila Salah, announced a political initiative to end the crisis and encourage peace-making efforts. Soon afterwards, however, LNA Commander Field Marshal Khalifa Haftar repudiated the Libyan Political Agreement signed in Skhirat on 17 December 2015, claimed a popular mandate to rule and announced plans to form a new governing body. Whereas Saleh's initiative was welcomed by world powers, Haftar's announcements triggered concerned reactions not only from the UN, the US and Europe but also from Russia, all opposed to unilateral actions of this sort. In all events, his plans have apparently floundered on the shoals of opposition among his main allies in the east. Haftar and Aguila Saleh have increasingly diverged in their views over a range of political issues and perspectives on how to handle forthcoming developments, especially in light of the failure of Haftar's military operation to gain control over Tripoli. Haftar's implicit opposition to Saleh's political initiative was one of the clearest manifestations of growing tensions in the eastern camp. However, tensions have also been increasing in the west, particularly between the Chairman of the Presidency Council Fayez Al-Sarraj, and members of the GNA and the heads of financial and economic organisations over the types of economic and fiscal policies that should be adopted to address the economic straits resulting from the closure of oil facilities and the coronavirus pandemic. On 28 May, Al-Sarraj dismissed GNA Minister of Economy and Industry Ali Al-Issawi, who had served in that post since July 2018, and charged current Finance Minister Faraj Boumatari with managing the affairs of that ministry. The dismissal of Al-Issawi, who had served as Libya's ambassador to India before the February 2011 uprising, followed a fallout between the two over the economic reform programme, Al-Issawi's reluctance to issue a commercial licence to the LTT (Libyan Telephone and Telecommunications) Company headed by Faisal Qurqab, and appointments to the Libyan Investment Authority. Qurqab has recently served in a number of crisis management committees created by the Presidency Council to address issues related to displaced persons and the fight against Covid-19. He was Al-Sarraj's nomination to succeed Ali Mahmoud as the chairman of the board of directors of the Libyan Investment Authority when Mahmoud's term ends this summer. Al-Sarraj has also fallen into dispute with the governor of the Tripoli-based Libyan Central Bank (LCB), Al-Siddiq Al-Kabeer, over foreign currency sales taxes which Al-Kabeer wants to raise from 163 to over 200 per cent. The tax has become one of the main sources for funding the budget due to the instability of oil production and export. Al-Sarraj opposes the measure. He is also annoyed by the LCB's blockage of documentary credits, delays in the payments of civil servant salaries and the ongoing dispute over international auditing of the LCB accounts. Al-Kabeer's opposition to international auditing of LCB accounts is supported by Khaled Shakshak, chairman of the Libyan Board of Auditors, who holds that the process that is being undertaken under the supervision of the UN Support Mission in Libya (UNSMIL) is “illegal”. He also argues that it is pointless because the question is about to be brought to court, which he maintains will rule to invalidate the process, which falls under the jurisdiction of national auditing authorities. The discord within both camps of the Libyan crisis may delay or obstruct plans to resume the three tracks of the Berlin Process, despite UNSMIL's repeated appeals for a ceasefire and the resumption of the meetings of the “5+5” military committee. This committee, which is one of the outputs of the Berlin Process and consists of senior officers from the LNA and GNA, has not met since the resignation of Salame in March. Tensions are rising at the international level as well since US Africa Command claimed, last week, that Russia has deployed 14 fighter jets to Libya and that this reflected Russia's long-term goal to establish a foothold in the region that could threaten NATO allies. According to Brigadier General Gregory Hadfield, deputy director for intelligence, the fleet of MIG-29 fighter jets and SU-24 bombers passed through Iran and Syria before landing at Libya's Al-Jufra Airbase. AFRICOM released aerial photos of the aircraft at Al-Jufra which, it claims, had been painted in order to disguise their identity. Then, to heighten US-Russian tension further, on 29 March, the US State Department announced that Malta had seized $1.1 billion of Libyan currency which it described as counterfeit because it had been printed in Russia and was destined to an “illegitimate parallel entity”. The US State Department regards this as further proof of Russian intervention in Libya. Russia has urged Malta to release the shipment of the minted currency so that it can reach its destination, the Benghazi-based Central Bank in Libya. Malta Today reported that the British government advised officials in Valletta to burn the money while Washington urged them to keep hold of it because it was “proof” of Russian support for Haftar and the LNA. Russia counters that the Joint Stock Company Goznak, a Russian state-owned company, has been minting the money for the Benghazi-based Central Bank in accordance with an agreement that dates to 2015 and that was approved by the Libyan House of Representatives at the time. *A version of this article appears in print in the 4 June, 2020 edition of Al-Ahram Weekly
