Goods Scarce, Discontent Widespread : With Oil in a Slump, Libya Has Fallen on Hard Times

It was Saturday night at Sinbad’s, Tripoli’s premier state-owned restaurant, and the menu boasted a rare treat--meat.

At a corner table, a group of Russians wearing dour expressions and imitation leather jackets were washing down the last of their meal with Jamahiriya Cola, the local version of Coca-Cola. Smiling down on them from the wall was a larger-than-life portrait of a man whose jowls were creased with sinuous lines that called to mind the dunes of the desert where he was born.

The smile, at once hard and serene, was lighted by a little green lamp that was intended to move in graceful circles around the portrait. Instead, it made palsied jerks, flickering across the face of Col. Moammar Kadafi--leader, teacher and self-proclaimed spiritual guide of Libya’s so-called Green Revolution.

The smile is everywhere in Tripoli--in bakeries, where sweaty men in dirty aprons make bread while long queues of people wait outside; in the supermarkets, where there are long rows of empty shelves; at the city’s few shabby movie houses, where patrons shuffle in to see kung fu movies and melodramas made in India; in the few small shops that are still open in the once-bustling souk.

‘It’s All We’ve Got’

At Sinbad’s, Kadafi smiles down on a waiter serving the daily special--watery soup, cold French fries and thin strips of gray, overcooked beef--to a group of foreigners. Seeing their looks of disappointment, the waiter leans over and says softly: “Look, I know it’s terrible, but you must understand the situation. It’s all we’ve got. I’m sorry.”

Sixteen years after Kadafi overthrew King Idris, nine years after he undertook his Green Revolution and two years after the bottom began falling out of oil prices, Libya under the mercurial colonel has fallen on exceedingly hard times.

Essential commodities are nonexistent or at best scarce. Long lines form for everything from meat and bread to soap and diapers. Construction cranes stand idle against the stubby skyline; once signposts of progress, they serve as grave markers for dozens of construction projects that have been postponed or canceled.

Widespread Discontent

Although Libya is still better off than many of its neighbors--it is still the richest country per capita in Africa--the sudden decline in the standard of living has fanned widespread discontent with Kadafi’s regime, according to more than a score of diplomats, foreign businessmen and Libyans interviewed during the course of a weeklong visit to Tripoli.

Western businessmen with access to high-level Libyan officials say these officials complain that their efforts to cope with declining oil revenues have been hamstrung by Kadafi’s determination to run Libya according to his eclectic Green Book philosophy, described by one observer as “part Maoism, part Nasserism and part the world according to Daffy Duck.”

The Green Book, which Kadafi published in three volumes in 1977, is basically a collection of ideas and slogans on everything from women’s rights to revolution. It presents what Kadafi calls his third theory of government, which reflects neither capitalism nor communism. Kadafi picked the color green to symbolize his revolution because it is the honored color of Islam.

One businessman who meets regularly with senior Libyan officials said, “Everyone I talk to nowadays admits that the system doesn’t work and that they are fed up.”

Diplomats say the unrest has become evident--in the streets, on university campuses and, more significant, in the ranks of the armed forces, 76,000 strong. In the last six months, there have been at least two food riots, several campus demonstrations and a reported coup attempt that ended in the death of Col. Hassan Ishkal, a Kadafi cousin. Some reports suggest that Ishkal was shot by Kadafi himself.

Programs Slashed

The drastic decline in oil earnings--from $22 billion in 1980 down to $8 billion last year and perhaps no more than $5 billion this year--has forced the government to slash imports, suspend work on all but a few high-priority projects and delay payments to nervous Western and East Bloc creditors who collectively are owed an estimated $8 billion.

“Virtually their entire budget, 98% of it, is provided by oil, so the drop in prices has had a tremendous impact on them,” a Western diplomat said.

Faced with difficulties in selling their oil, the Libyans have been trying to barter it. Western diplomats estimate that nearly half of Libya’s estimated production of 900,000 barrels a day has been earmarked for barter deals, mostly with East Bloc countries. But efforts to get major creditors like Italy, which is owed $650 million, and South Korea, which is owed at least $400 million, to accept oil as payment against debts have stalled over Libya’s insistence that the oil be valued at $23 to $28 a barrel--more than twice the spot market price.

Italy Suspends Pact

Italy suspended one such compensation agreement last month, and two major South Korean conglomerates, Samsung and Daewoo, have turned down similar Libyan offers, although both are still negotiating.

So far, the economic crisis does not seem to have affected Kadafi’s revolutionary ways, however. Military purchases from the East Bloc reportedly still run about $1 billion a year, and the colonel seems as determined as ever to spread his unique version of socialism beyond Libya’s shores through what one diplomat calls his “nuisance budget”--the money he lavishes on revolutionary movements around the world.

Indeed, only last month Kadafi put on an all-expenses-paid conference for 600 delegates from more than 250 organizations opposed to “imperialism, Zionism, racism and fascism.” A “conference against everything,” diplomats called it. The three-day meeting brought together radical groups based in regions from Latin America to the South Pacific. Among the delegates were Kurds, Basques, Filipinos, Nicaraguans, American Indians and Black Muslims from the South Side of Chicago.

Kadafi Picked Up Tab

“They came with paid hotels and paid airline tickets,” a Western diplomat said. “It cost a lot of money to put on at a time when they can’t afford to buy meat. We don’t know if Kadafi promised any money to anyone, but he must have, because they all came begging.”

A delegate who stayed on after the conference for further talks with the Libyans was Louis Farrakhan, leader of the Chicago-based Nation of Islam. He and several of his aides were still in Tripoli two weeks later, when Western reporters arrived after the clash in the Gulf of Sidra between Libya and the United States.

Because of the secretive nature of such expenditures, and the fact that no budget has been announced for 1986, it is difficult to find out to what extent Kadafi’s military adventures and his support for guerrilla organizations are sapping Libya’s income. But apart from the “Great Man-Made River Project,” an ambitious scheme to pump water from wells beneath the Sahara to the faraway Libyan coast, it is clear that very little is being spent on anything else.

Imports Being Reduced

Imports were reduced last year to $1.8 billion from a budgeted $5 billion, and the level is believed to be even lower now. Until a hurried delivery of beef from Ireland a few weeks ago, meat had been unavailable for months. At the Jamahiriya (state of the masses) supermarket, one of Tripoli’s showcase stores, the cooler shelves are stocked with powdered milk, clarified butter, tomato paste, insecticide and tea--and nothing else.

“Life here is terrible now; we can get nothing to eat,” said a Polish nurse who has spent six years in Libya and is looking forward to returning to Warsaw in a few months.

The wife of a diplomat, who brings 250 pounds of groceries back from Malta once a month, said, “I can’t remember when we last saw things like vinegar or pepper.”

As bad as things are, Western businessmen who meet frequently with Libyan financial planners note that Libya’s economic problems may not be as grim as they seem.

Credit Seen as Good

For instance, the Libyans “have not used their potential to tap foreign credit markets yet,” one businessman said, and he pointed out that Libya has always been a cash-payment importer. “I’m sure they would have no trouble going out and getting export credit if they wanted to,” he said. “So even though the economy is in dire straits, it’s something they could change if they put their minds to it.”

So far, the government’s response to economic problems has only seemed to aggravate them. Kadafi, for example, has sought to use the revenue crisis to further his ideas of revolutionary self-sufficiency. He has called on Libyans to stop relying on imports and to work harder in order to attain economic independence.

With only 3.5 million people, Libya is heavily dependent on foreign labor. Foreigners run most of the service industries, they work in the fields and they are present in large numbers even in the armed forces, which rely heavily on pilots from Pakistan and technicians from other Arab and African countries, according to Western diplomats.

Fruit Rots on Trees

Partly in response to Kadafi’s exhortations to be more self-reliant, Libya last year abruptly expelled more than 100,000 foreign workers, mostly Egyptians and Tunisians. But far from making Libyans more self-reliant, the expulsions added to the economic chaos, for in many instances the foreign workers were not replaced by local labor. Oranges and lemons, which are in short supply in the markets, are rotting on the trees because Libyans have not replaced the Egyptians who were brought in to pick them, according to Western diplomats.

Although the food shortages and other economic hardships are the biggest source of discontent, other measures introduced or accelerated by Kadafi over the last year to further his Maoist experiment in social upheaval have also been unpopular, diplomats and other Tripoli residents say.

“There were a lot of complaints last year when Kadafi decided that everybody up to the age of 55 or 60 had to serve one day per week and one month per year in the People’s Army,” a diplomat said, referring to the militia that, according to Kadafi’s Green Book, will someday replace the standing army.

Even though training “seems to consist mostly of light exercises and a lot of shouting,” most Libyans “were shocked that they made aged people go to it,” the diplomat said.

Kindergartens Closed

The very young are not spared, either. Kadafi closed all the kindergartens in Libya last January on grounds that self-sufficiency means that children should not be dependent on schools but should be taught at home by their parents. Although this decision proved unpopular enough to be rescinded two weeks later, revolutionary experiments in education are continuing, with mixed results.

Only last week, the education secretary, Ahmed Ibrahim, was heckled by students on the campus of Tripoli’s Fatah University when he announced that French and English would no longer be taught. To enforce the edict, he ordered the burning of all English- and French-language texts.

“Can you imagine? They burned our books,” a woman student complained, rejecting a friend’s counsel against talking with a Western reporter. “Our education is bad and gets worse every year,” she said, and others agreed with her. They consented to be interviewed only on the condition that their names not be disclosed.

Ideology Wearing Thin

A Western diplomat said: “The ideological phraseology of this regime is starting to wear very thin. People lived with it when the economy was providing them with luxuries. But now the people are looking towards the day when the regime will disappear.”

Most observers agree, however, that if Kadafi faces any real threat, it can only be from within the army, which is the only organized institution left in the country.

There is said to be tension among the military men. Diplomats say they are prohibited from having direct contact with the military, but rumors persist that some in the army are upset with the erosion of its prestige since Kadafi began setting up the rival People’s Army two years ago. Senior officers are said to be unhappy with the growing power and independence of the “revolutionary committees,” groups of youths charged with spreading and enforcing Kadafi’s Green Book philosophy in both the military and civilian sectors.

Control and Surveillance

Other diplomats say they doubt that the army is capable of doing anything because Kadafi, aware of the unrest, has set up so many systems of control and surveillance that would-be plotters are discovered before they have a chance to act. Details are sketchy and sometimes contradictory, but such seems to have been the case with the Ishkal affair last November.

“Anytime the name of a possible successor to Kadafi pops up, he disappears,” a Western diplomat said.

Another diplomat said: “The students have the philosophical inclination, but they don’t have the arms. The army has the arms, but it doesn’t have the momentum.” Army morale, he added, is “very low.”

One point that virtually every diplomat, businessman and Libyan interviewed in Tripoli agreed on is that Kadafi’s efforts to silence critics has had help from an unlikely quarter, the United States.

Confrontation Planned

The U.S. confrontation with Kadafi in the Gulf of Sidra last month was evidently planned by the Reagan Administration in the hope of stimulating dissatisfaction in the army and encouraging more coup attempts. But in the opinion of all the analysts interviewed here, the limited conflict that took place is likely to have the opposite effect.

“This whole crisis has helped Kadafi immensely at a time when he really needed it,” one diplomat said. “Libyans may dislike Kadafi, but they are Arabs and they are very proud, and this was perceived as an attack not against Kadafi but against Libya, because Libyan territory was attacked and Libyan lives were lost.

Another diplomat said: “In January, people were fed up with having to queue for bread and were saying so openly. But then came the first American maneuvers, and people forgot about these problems. It has been great for Kadafi, because now he is able to blame all these domestic problems on the United States and distract people’s attention from them. He needs this tension.”

Discontented Libyan officials are said to share this assessment in private with people they trust.

“I’ve had Libyans tell me that ‘if the U.S. had only left us alone, we would have been rid of Kadafi within a year or so,’ ” a Western businessman said, describing conversations with high-level Libyan officials. But now, as a result of the U.S. crusade against Kadafi, the businessman went on, “these same people are saying that ‘we’re stuck with Kadafi for the next 10 years.’ ”