As Libya’s citizens rebuild their lives and economy, undoing the corruption in the Libyan Investment Authority, the sovereign wealth fund in which the Qaddafi regime stashed and misused Libya’s oil wealth, is becoming a priority. Whatever the outcome, all sovereign wealth funds – and
NEW YORK – As Libya’s citizens rebuild their lives and economy, undoing the corruption in the Libyan Investment Authority (LIA), the sovereign wealth fund in which Muammar el-Qaddafi’s regime allegedly stashed and misused Libya’s oil wealth, is becoming a priority. The National Transitional Council is debating who should take over Libya’s Central Bank and the LIA’s assets – an especially important decision, given that oil production is not expected to return to pre-war levels for several years.
Regardless of how the Libyan government eventually handles the LIA, all sovereign wealth funds – and their advisers and fundraisers – can learn several important lessons. Of course, no one should infer from the Libyan case that other SWFs across the board are riddled with corruption and conflicts of interest. The LIA has always been exceptional; indeed, several indices that rank SWFs on transparency, accountability, and governance issues have traditionally given only Iran a lower ranking.
Yet, while hard cases tend to make bad law and it is too early to judge, the LIA should be a wake-up call for corporations and funds both in the Middle East and around the globe.
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NEW YORK – As Libya’s citizens rebuild their lives and economy, undoing the corruption in the Libyan Investment Authority (LIA), the sovereign wealth fund in which Muammar el-Qaddafi’s regime allegedly stashed and misused Libya’s oil wealth, is becoming a priority. The National Transitional Council is debating who should take over Libya’s Central Bank and the LIA’s assets – an especially important decision, given that oil production is not expected to return to pre-war levels for several years.
Regardless of how the Libyan government eventually handles the LIA, all sovereign wealth funds – and their advisers and fundraisers – can learn several important lessons. Of course, no one should infer from the Libyan case that other SWFs across the board are riddled with corruption and conflicts of interest. The LIA has always been exceptional; indeed, several indices that rank SWFs on transparency, accountability, and governance issues have traditionally given only Iran a lower ranking.
Yet, while hard cases tend to make bad law and it is too early to judge, the LIA should be a wake-up call for corporations and funds both in the Middle East and around the globe.
We hope you're enjoying Project Syndicate.
To continue reading, subscribe now.
Subscribe
Get unlimited access to PS premium content, including in-depth commentaries, book reviews, exclusive interviews, On Point, the Big Picture, the PS Archive, and our annual year-ahead magazine.
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