UARU
Putin’s New Playground in Libya, Explained
12 June, 2020
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U.S. Africa Command

Russia's presence in Ukraine and Syria has long been established by observers both at home and abroad. However, the Kremlin has more recently been shoveling mercenaries and resources into a lesser-known proxy war next to one of the world's largest oil fields. The Libyan civil conflict has become a proxy conflict between Turkish and Russian forces. After years of territorial gains, the Kremlin-backed general Khalifa Haftar is suddenly losing ground to the UN and Turkey-backed Government of National Accord (GNA). Our partner outlet Novaya Gazeta examines what went wrong for Putin in Libya.

Backstory

Russia's record is riddled with military intervention around the globe. In the early 1990s, it deployed thousands of troops into Moldova to aid separatists; in 2008, it sent soldiers into neighboring Georgia; in 2014, Moscow annexed Ukraine's Crimean peninsula and stirred up unrest in the country's east. Russia is now trying to grow its influence in Africa, with oil-rich Libya its latest target.

The Kremlin's modern military operations are often covert and carried out by Wagner Group, a private military firm operating in countries including Ukraine, Syria, Venezuela, and now Libya. The company is linked to the Russian billionaire businessman and Kremlin "fixer" Yevgeny Prigozhin, who is leading Putin's expansion in Africa. Prigozhin is also under US sanctions for his affiliation with the St. Petersburg "troll factory" – a company engaged in online influence campaigns on social media. In 2018, Russia's Defense Minister Sergey Shoigu hosted Libya's Haftar- a former student of Russia's Frunze Military Academy - together with Prigozhin.

Both the Kremlin and Haftar deny the presence of Russian mercenaries in Libya. 

     Kremlin’s Messy Game in Libya, Detailed 

The North African country has been ravaged by conflict since 2011 when a series of protests and an international intervention helped to oust Muammar al-Gaddafi's totalitarian regime. Back then, the Kremlin gave a tacit consent for a multi-state and NATO-led coalition to invade the country by abstaining from the Security Council vote sanctioning the mission. Moscow regretted the decision later and has been spinning the narrative of being "misled" instead. 

Photo: U.S. Africa Command

Following the intervention, efforts to rebuild the country failed. New conflict broke out between the now internationally recognized GNA and Moscow-backed Haftar in 2014. Russia's strategy in Libya is multifocal, and its loyalties don't explicitly lie with the Libyan National Army commander. Still, for years now, the Kremlin has been pouring its resources into Haftar's offensive. 

For six years, Haftar's gains were aided by the United Arab Emirates and Saudi money, Russian conventional weapons, and the notorious Kremlin-linked private mercenaries from the Wagner Group. In April of 2019, Haftar, a former Gaddafi-ally, announced the start of an offensive on the capital Tripoli. His Libyan National Army (LNA) managed to capture almost a third of the country's inhabited territory, reaching the outskirts of the capital. Until recently, it seemed that Haftar might be successful in capturing Tripoli, where the GNA is based. 

Then, Turkey stepped in. According to Novaya Gazeta's sources in the Defense Ministry, for the past three months, the Turks have been actively importing militants from Syria into Libya, with more than 3,500 Syrian armed opposition fighters delivered to the GNA. But all this is just support for what is now mainly a drone war. The recent wave of targeted drone strikes helped GNA launch a counteroffensive, forcing Haftar to retreat for the first time. 

Earlier this year, his forces lost the strategic base of al-Watiya, which he used to siege the country's capital of Tripoli. After that, hundreds of Russian mercenaries were reportedly evacuated from the frontline last month. A captured Russian-made and UAE-bought missile system was paraded by GNA. Following this, the Turkish Defense Ministry declared: "Thanks to Turkish military consultants' actions, the balance of forces in Libya has changed." 

Sources say that Haftar, in response to Turkey's interference, allegedly offered to conduct a joint air operation with Russia, Egypt, and UAE. That means that the Wagner group is not coping.

A battle for airspace is now pending, with at least 14 Russian-made fighter jets reportedly landing at the Haftar-controlled Al Jufra Airbase. Haftar’s deputy in aviation matters then announced the bombing of GNA positions. 

In a press release last week, U.S. Africa Command (Africom) stated that the jets will likely provide air support and offensive fires for the Wagner Group. It’s alleged the planes came from a Russian airbase but transitioned through Syria, where they have been painted to camouflage “Russian origin.”

''Russia is clearly trying to tip the scales in its favor in Libya. Just like I saw them doing in Syria, they are expanding their military footprint in Africa using government-supported mercenary groups like Wagner,'' said Africom's commander Stephen Townsend. 

"The world heard Mr. Haftar declare he was about to unleash a new air campaign. That will be Russian mercenary pilots flying Russian-supplied aircraft to bomb Libyans." This appears to be Haftar's retaliation for the destruction of the al-Watiya airbase and a fresh grab for the crown of Libya's former prime minister, Muammar Gaddafi. According to the leaked UN report, there are air observers among Wagner mercenaries in Libya. And that's the key to accurate and effective airstrikes. 

Counting Russian Bills That Pay for the Libyan War 

Russia’s involvement in Libya goes far beyond military intervention. Since 2016, Moscow has reportedly printed over $9 billion in Libyan money (dinars) for Haftar and transported it through the EU state of Malta. Last month, the Maltese government seized $1.1 billion in “counterfeit Libyan currency” printed by Russian state company Goznak, which manufactures banknotes. 

In response, the US Department of State issued a statement, praising the authorities and denouncing the currency as “counterfeit” and “ordered by an illegitimate parallel entity.” It stated that the Central Bank of Libya in Tripoli is Libya’s only legitimate central bank. Russia rejected the US statement, saying Libya has two central banks - one in Tripoli and one Haftar-controlled in eastern Libya.

So are they ‘fake?’ Technically speaking, they are since the Russian-printed banknotes are ordered not by an UN-recognized government. In reality, though, both official and Russian-made notes are widely used across Libya by everyone.

The Libyan Central Bank gets the country’s banknotes also printed abroad and shipped through Malta. Apart from occasional crackdowns, a tiny EU island-state allows the transit of both official and Russian-made Libyan dinars. Why? Corruption and the migration crisis. According to the Central Bank of Malta, the local illegal economy — mainly smuggling — produces 21% of GDP.

Furthermore, Malta disproportionately suffers from Libyan refugee waves and wants the situation resolved. The country is ready to bet on anyone as long as they restore order to Libya and stop the stream of refugees. And they believe Russian-backed Haftar is up to the task.

Follow Russian Outsourced Money-Printing 

To be fair, Russia doesn’t only print money for Libya. Goznak does it for more than a dozen countries and delivers banknote paper worldwide, including to some European states, China, Canada, among others. But the Kremlin has a long history of using outsourced money-printing as a geopolitical influence tool.  Take Afghanistan in the 1980s, when the Soviet Union would print local banknotes for Kremlin-backed government to finance standoff with the US-backed Afghan mujahideen. 

Dictators often need to have a regular supply of banknotes, without which nothing works. This is especially so in countries where cashless payment systems are poorly developed. This means that rich states which sponsor regimes have the power to pull the cash at any moment. 

The tactic used by a number of Western states, too. In 2011, just before Gaddafi was ousted, British authorities seized equivalent to 1.86 billion pounds of dinars, printed as part of a contract with the leader. This was done by British company De La Rue, the largest banknote producer in the world and Goznak’s biggest competition. After that, Libya’s Central Bank manager switched to the rebel side, the country ran out of cash and the people overthrew the dictator. 

More recently, the Bank of England has blocked the release of around $1 billion in gold to Venezuela, which is also in the midst of a power struggle. 

This deeply entrenched trend allows the Kremlin to continue its long tradition of meddling with less stable and poorer countries. 

Political Meddling as a Bonus

In addition to the UN-confirmed presence of private military and money-printing in Libya, Moscow is suspected of another ‘specialty’ — election and political meddling technologies. And it appears with Haftar’s precarious grip on power in Libya, the Kremlin had been discreetly looking for alternatives to back. According to Bloomberg, Russia had been secretly trying to install Saif al-Islam, son of Gaddafi, as president.

Photo: U.S. Africa Command

Last year, Bloomberg publicized the arrest of two men - Maxim Shugaley and Samer Hassan Seifan -  accused of working for a Russian troll factory that “specializes in influencing elections in several African states including Libya.” Bloomberg called Shugaley a Russian political consultant working for the Moscow-based Foundation for the Defense of National Values. The chief of the foundation headed a website controlled by Prigozhin for some time.

Shugalei and Seifan. Photo: Twitter

A Prigozhin-controlled media in Russia claim the men were really two scientists openly conducting research in Libya. Except the Russian scientometric database doesn’t feature a single publication by them. Shugaley and Seifan are, in fact, suspected of aiding a plan to make Saif al-Islam the country’s leader. The management of the Russian troll farm had also allegedly been in contact with Gaddafi’s son. However, this Kremlin’s ‘plan B’ for Libya has also reportedly backfired.

/Translated and abridged by Natalie Vikhrov, with materials from Novaya Gazeta correspondent Valery Shiryaev, Irek Murtazin and Valery Shiryaev. Courtesy of the Russian Language News Exchange.