Libya’s $70bn wealth fund expects thaw in UN asset freeze by year-end

The Libyan Investment Authority is expecting UN sign-off by the end of the year to actively manage its $70bn in assets for the first time in more than a decade, its chief executive told Reuters.
The LIA, set up under Muammar Gaddafi in 2006 to manage the country’s oil wealth, has been under a United Nations asset freeze since the 2011 revolution that toppled Gaddafi.
This means that in order for Africa’s largest sovereign wealth fund to make new investments, or even move cash from negative interest rate accounts, where they have been losing money, the LIA needs UN Security Council sign-off.
Chief Executive Ali Mahmoud Mohamed said the authority is confident the council will provide the landmark approval by November or December for an investment plan it submitted in March.
“We believe our investment plan with be accepted…we don’t think they will refuse it,” Mohamed told Reuters via a translator.
The first of LIA’s four-part plan is the “very simple” step of reinvesting money that has built up during the freeze, such as payouts from bond holdings. The LIA has previously tried to actively manage its funds. But in the turmoil following Gaddafi’s ouster, it at one point had duelling chairmen, backed by different factions within the country.
A British court ruled in 2020 in Mohamed’s favour. In 2020, the LIA said a Deloitte audit showed the freeze had cost it some $4.1 billion in potential equity returns.
He said transparency has since improved; the LIA released audited financial statements in 2021, covering 2019. It aims to publish the 2020 numbers in the coming months and provide them annually from next year. And while the LIA was 98th out of 100 sovereign funds in a 2020 ranking of sustainability and governance by Global SWF, an industry data specialist, it stood at 51st this year.