Libya - once a donor country, now donation reliant

On the first day of his presidency, Donald Trump signed an executive order suspending funds to global programs administrated and managed by the State Department’s United States Agency for International Development (USAID). In total, $44 billion earmarked for funding thousands of programs, including health programs in dozens of countries in Africa and beyond was suspended. To implement “The Executive Order on Re-evaluating and Realigning United States Foreign Aid” Secretary of State Marco Rubio ordered all money to be frozen pending review to see if projects are in line with Trump’s “US foreign policy under the America First agenda.”

Trump, during his campaign for the White House, repeatedly complained that the US was being “ripped off” not only through “wasteful” international aid programs, but also in trade with other countries, particularly the US’ major partners like China, Canada and Mexico. To remedy this, Trump reverted to using tariffs as a tool for advancing his foreign policy agenda, taxing different imports – particularly steel from Canada and Mexico and laptops, footwear and clothing from China.

China has already responded in kind by imposing its own levies on goods it imports from the US like liquefied natural gas, crude oil and agricultural machinery. While Mexico and Canada are poised to reciprocate the US action, both countries have not done so after the US put on hold the measures pending negotiations to avoid what could amount to a trade war.

However, nothing could be done to halt Trump’s decision to cease funding for USAID.

USAID, the US government’s foreign aid arm, is believed to have distributed some $74.9 billion in foreign assistance during 2023, given – primarily – to third parties and private contractors to help counties in need. Before Trump’s Executive Order, USAID was already allocated some $58.4 billion to spend on foreign aid that included health programs, development projects and political issues like governance, anti-corruption programs and human rights.

The organisation is now being shut down and only 294 of its estimated 10,000 worldwide staff are being retained while the rest are at risk of being fired or suspended. Trump looks determined to shut down the only US governmental organisation tasked with helping other countries, particularly in the Global South.

The war against USAID reveals a lot about how the organisation has been using taxpayer’s dollars around the world in, sometimes, bizarre ways. The agency is already accused of spending money on providing male and female condoms and other contraceptives in what the agency calls “family planning and reproductive health” which includes AIDS prevention. But the Trump Administration, in attempts to justify its targeting of the agency, portrayed this out of context and labelled it wasteful. Elon Musk, Trump’s point man on trimming federal government spending, went as far as accusing USAID of being “criminal”.

“The program, USAID says, aims to “enhance democratic processes in Libya”; a rather sensitive issue many Libyans view with suspicion and see as interfering in Libya’s internal affairs”

While the agency is being dismantled, it is worth reviewing some of its programs in countries like Libya, which until recently used to be a donor country but all that changed when its government was overthrown in a NATO supported and US-led military intervention that set the country in freefall.

USAID, until 2023, appears to have spent nearly $1 billion on programs in Libya that focused on government to government aid with unknown amounts given to nongovernmental local organisations that have to do with good governance, voting issues and human rights causes. Through programs, implemented in cooperation with the Ministry of Local Government, USAID was planning to spend nearly $50 million until 2029 on its program called “Engagement with Voters for Equitable Representation (EVER).” The program, USAID says, aims to “enhance democratic processes in Libya”; a rather sensitive issue many Libyans view with suspicion and see as interfering in Libya’s internal affairs, even if it’s permitted by the Government of National Unity (GNU) which enjoys limited control on the fractured country.

USAID was, until last year, also funding or planning to fund a five year program called “Media Integrity and Resilience, Supporting Audiences in Libya (MIRSAL)” which the agency says aims at “strengthening media integrity and resilience.” Both USAID and the Ministry of Local Government have been contacted for this report but not responded.

But Libya doesn’t only receive donations from USAID, the European Union with its individual member states also contribute to a government which they know only too well is the most corrupt in Libya’s history. Between 2014 and 2020, the EU allocated some $98 million within its larger European Neighbourhood Instrument to Libya. The top aim of the EU was “Governance and Civil Society Support.” Neither the EU nor the local Libyan authorities reveal the local organisations that benefitted from such money. The EU also provides funding through the Tripoli government to municipalities to cope with the flow of migrants. The overall EU assistance to Libya, from 2014 to 2020, amounted to over $731 million including the aforementioned $98 million.

Migration through Libya and the large flow of foreign irregular migrants wishing to go to Europe is a very controversial and sensitive issue within Libya’s domestic political scene with many suspecting that the EU does not really care about migrants as long as they are kept in Libya and away from Europe’s borders. Many fear such funding might help settle migrants in the vast sparsely populated and resource rich country.

For example Italy, an EU member at the frontline of the immigration issue, is accused of funding Libyan militias that mistreat migrants, abusing them and forcing them into slave-like conditions in networks of jails and detention camps. It has been known since 2017 that Italy, in its attempts to stem the flow of irregular migrants and asylum seekers, paid millions of euros to Libyan militias – including the Coast Guard which usually catches migrants at sea – and return them to Libya.

READ: Libya’s decline into a ragdoll nation

Both the EU and USAID know only too well that Libya effectively bans and criminalises any funding to local organisations unless they fall within the government frameworks. Law 19/2001 makes it a crime for any local organisation to receive money from abroad. The country’s penal code, Article 206, imposes strict penalties on anyone receiving money from outside. Yet they continue to pump money into corrupt local authorities with little positive results

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Unfortunately, foreign funding in Libya only helps the country become a more donation reliant state and fails to return it to its former days as a donor country.

The views expressed in this article belong to the author and do not necessarily reflect the editorial policy of Maghrebi.org. Mustafa Fetouri is a Libyan academic and freelance journalist. He is a recipient of the EU’s Freedom of the Press prize.

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