BENGHAZI, LIBYA // As more of the country is liberated from Colonel Muammar Qaddafi, officials in the rebel capital are becoming spread thin as financial resources are depleted and donor countries waffle over releasing money to the interim government.
"Just give us the money, we'll take care of the rest," said Moraja Ghaith, assistant to the minister of finance and oil in Benghazi. "We hope it will come soon."
Mr Ghaith said the National Transitional Council's resources are being spent more quickly than any time during the revolution now that new regions of the country, including Tripoli, are coming under rebel control. The interim government began flying bales of cash to buy supplies and support citizens in the mountain regions in the West and Tripoli itself in the last several days, he said. Sending money to residents of Tripoli for Ramadan was also being discussed in Benghazi as a show of unity.
The government coffers, with more than US$200 million (Dh734m), can support the government for another two weeks, Mr Ghaith said.
His comments underscored a statement made yesterday by Mahmoud Jibril, the prime minister of the NTC, during a press conference in Italy that the country could be destabilised without support.
"The biggest destabilising element would be the failure of the National Transitional Council to deliver the necessary services and pay the salaries of the people who have not been paid for months," he said.
A group of 30 countries and international organisations, known as the Libya contact group, were debating a plan this week in meetings in Qatar to unfreeze billions of dollars that were controlled by the former regime to pay government wages, buy humanitarian supplies and pay for operations.
But without a United Nations resolution, several countries - including the UAE - said they would not be able to release frozen assets. Several countries, including Italy and Turkey, have started releasing some funds in the form of donations and loans that would be paid back once the overseas money was unfrozen.
The NTC has asked for $5 billion to be unfrozen immediately, more than double what it had said only a few days earlier was needed before the end of the month, as the campaign to take control of the country succeeded more quickly than expected.
The UN Security Council was expected to imminently release $1.5 bn to the NTC on top of the $5 bn under discussion. The ability to improve living conditions in liberated cities, where many people have lived on scarce supplies for months, will prove a crucial factor in the NTC's attempts to unify the country now that Col Qaddafi has lost control of the capital.
Even in Benghazi, where security has been restored for several months, factories have ground to a halt, business has slowed, and there are shortages of gas for cooking. Beggars stand in the midday heat near stoplights, asking for spare dinars.
There is a need "to pay salaries, especially as some 70 per cent of the workforce is employed by the public sector, and it's clear that money is needed for the overstretched medical system as well as other services," said Jane Kinninmont, an analyst at the London-based Chatham House.
The NTC will also find one of its most complex challenges in acquiring and distributing some of the more than $100 bn worth of national savings and aid money to stabilise the country in the coming year. Much of these funds were frozen in overseas accounts after the United Nations passed a resolution to put pressure on Qaddafi, his relatives and associates, in response to his attacks on civilians in February.
Any sign of misspending, government officials enriching themselves or favouritism for tribes or interests could intensify divisions across Libya.
"It's not clear that any safeguards are in place to control how the money is spent," Ms Kinninmont said, adding that Libya needed to draw lessons from post-war Iraq where corruption "severely hindered efforts to rebuild the economy".
"There is a vicious circle where economic failures - notably high youth unemployment and the deficient power supply - contribute to further political risk," she said. "Libya needs to avoid this trap."
The amount of money potentially within reach of the NTC will be pushed even higher by oil earnings as high as $50bn a year if output can be brought back to pre-revolution levels of about 1.6 million barrels a day, analysts say. This could take several years if oil facilities turn out to have been badly damaged during the fighting.
The Temporary Finance Mechanism, set up specifically to ensure donor countries in the contact group that their loans and donations are spent in the correct way, is by far the most advanced entity in Benghazi to set up controls and procedures to handle incoming funds. It has hired the finance advisory firm Adam Smith International to help create standards for spending.
Former investment bankers and other financial professionals, many of them exiles who returned to Libya during the revolution, have been having round-the-clock meetings to get the fund's structures in place and convince donors to release the money.
Other groups, such as the Ministry of Finance and Central Bank, are operating with little oversight except from the NTC's committee on oil and finance.
"We have our own very strong controls," said Mr Ghaith, the assistant to the finance and oil minister. He said there were no plans to hire any outside auditors or consultants.
There is also some uncertainty about the people now in charge of running the NTC. Many of the ministers were appointed in the last two weeks after the interim prime minister sacked the entire cabinet in the wake of the assassination of a rebel general. That killing is still unsolved.
Geoff Porter, the head of North Africa Risk Consulting in the US, said earlier this week that the lack of financial controls over such a large pool of wealth in the country meant that "there is a pretty high probability that money is going to misappropriated or misspent" and that there could be a "distribution of resources for political benefits of some people".
bhope@thenational.ae