Libya's Gaddafi will try to sell Libyan gold: ex-central banker

Reuters News
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Posted: Aug 25, 2011 3:28 AM
Libya's Gaddafi will try to sell Libyan gold: ex-central banker

MILAN (Reuters) - Muammar Gaddafi will try to sell part of Libya's gold reserves to pay for his protection and sow chaos among tribes in the north African country, said his former central bank governor Farhat Bengdara.

Bengdara, who has allied himself with the Libyan rebels, told the Italian daily, Corriere della Sera, that an ally of Gaddafi had offered 25 tonnes of gold to his friend "a little time ago."

"My friend referred it to me and I suggested that he refuse and my friend immediately rejected the approach. But it is a clear indication," Bengdara said in the interview published on Thursday. He said his friend was not Libyan but gave no further details.

There are gold reserves worth $10 billion in Tripoli and Gaddafi could have taken some of that amount, he said.

Bengdara said he believed that Gaddafi had fled Tripoli and could be heading toward the Algerian border.

"Now he is looking to pay and corrupt some tribes and some militia to have protection and to create further chaos," he said.

The former central bank governor, who is a director of Italian bank UniCredit, said Libya needed $5-$7 billion as a bridging loan to get the banking system restarted and to pay for imports.

"We don't need donors. Libya is a rich country. The state activities from the Libyan Investment Authority, the central bank and gold reserves are worth $168 billion. But it is all frozen," Bengdara said.

It will take months and a U.N. Security Council resolution before these sums are freed up, he said.

(Writing by Nigel Tutt; editing by Elizabeth Piper)