ISTANBUL, (Reuters) – The United States today recognised Libya’s rebel National Transitional Council (TNC) as a legitimate government, a diplomatic boost which could unlock billions of dollars in frozen assets.
U.S. Secretary of State Hillary Clinton said Washington would extend formal recognition to the Benghazi-based TNC until a fully representational interim government can be established.
“The TNC has offered important assurances today, including the promise to pursue a process of democratic reform that is inclusive both geographically and politically,” Clinton said in prepared remarks.
“Until an interim authority is in place, the United States will recognize the TNC as the legitimate governing authority for Libya, and we will deal with it on that basis.”
Clinton’s announcement came as the Libya Contact Group, meeting in Istanbul, formally recognised the opposition as the representative of the Libyan people — sealing its diplomatic status as the successor government to embattled leader Muammar Gaddafi.
The contact group, made up of more than 30 governments and international and regional organisations, also authorized U.N. special envoy Abdul Elah Al-Khatib to present terms for Gaddafi to leave power in a political package that will include a ceasefire to halt fighting in the civil war.
Clinton said any deal “must involve Gaddafi’s departure” from power and a halt to violence.
“Increasingly the people of Libya are looking past Gaddafi. They know, as we all know, that it is no longer a question of whether Gaddafi will leave power, but when,” she said.
U.S. officials said the decision to extend formal diplomatic recognition marked an important step toward unblocking more than $34 billion in Libyan assets in the United States but cautioned it could still take time to get cash flowing.
U.S. President Barack Obama signed an executive order on Feb. 25 freezing the assets of Gaddafi, his family and top officials, as well as the Libyan government, the country’s central bank and sovereign wealth funds.
Most of the frozen assets are liquid in the form of cash and securities.
U.S. officials have pledged to find ways to free up some of the money for the TNC, which has run dangerously short of cash to pay for salaries and basic services even as it takes on more of the responsibilities of government.
