Gaddafi accuses his officials of clinging to the status quo to protect their privileges

Financial Times

Libyan televised debate signals change

By Heba Saleh in Cairo

November 14 2008

Libyan television viewers were treated this week to a rare scene – Colonel Muammer Gaddafi, their ruler, was debating with disapproving senior government officials his grand plan to distribute the proceeds of oil wealth directly to the people and abolish government ministries.

In a country where no dissent is tolerated, viewers heard Farhat Omar Bin Guidara, central bank governor, telling the leader that doling out large sums of money to the masses would fuel inflation, cause the value of the dinar to drop and create a balance of payments deficit.

Al-Baghdadi Ali al-Mahmoudi, prime minister, meanwhile, argued for an alternative approach under which Libyans would be given shares in their country’s banks, manufacturing plants and telecommunications companies through portfolios to be managed by financial institutions.

The maverick Colonel Gaddafi gave no sign of having been convinced. Instead, he accused officials of clinging to the status quo to protect their privileges. “What you want is that the ... situation remains unchanged so you can keep your positions,” he said. “That is the psychology which underpins your arguments.”

Even so, analysts say the mere fact that the meeting was broadcast suggests the people are being prepared for a possible about-face.

“I think what he is doing is telling the people that he is still very much in favour of the original idea but that there are decision makers in Libya who are obviously against it,” said Dirk Vandewalle, a Libya specialist and professor at Dartmouth College.

“He is trying to portray a potential setback as a democratic move.”

Mr Vandewalle also believes the debate might be a sign of another fundamental change in Libya. “I guess what it means is that the pattern in which decisions were made at the top and implemented without discussion is increasingly being questioned,” he said. “It may indicate the growing power of technocrats who favour opening up Libya.”

Arguing that the government structure had bred corruption and failed the people, Colonel Gaddafi decreed in March a scheme for distributing money and dismantling most ministries, leaving only interior, defence and foreign affairs.

He promised that every family would be handed its share of the oil wealth and it would be free to spend it the way it liked, buying services such as health, education and housing from private sector companies.

While some Libyans saw the leader’s approach as a sign of a belated conversion to capitalism, others, including officials and businessmen, were alarmed, fearing that the plan would be a recipe for economic chaos.