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Why US plans for power-sharing in Libya will not work

Why US plans for power-sharing in Libya will not work Expert comment LToremark 20 July 2026 Libyan anti-corruption investigations reveal the limitations of a US push to reunify the country without improving governance. In recent weeks, Massad Boulos – President Trump’s senior adviser on Arab and African affairs – has stepped up efforts to break through Libya’s political deadlock. The country is split between two rival administrations: the UN-recognized Government of National Unity (GNU) in Tripoli – controlled by the Dabaiba family – and the Benghazi-based Government of National Stability (GNS), aligned with Khalifa Haftar’s Libyan Arab Armed Forced (LAAF). The US plan is to bring the Haftars and the Dabaibas together with other key constituencies and form a unified government. In June, LAAF deputy commander Saddam Haftar travelled to Washington to meet with US Secretary of State Marco Rubio, as Boulos seeks the Haftar family’s agreement on power-sharing. The Dabaiba family did not travel to Washington but Boulos still hopes to convince them to support the deal. For the deal’s opponents – and there are many – it looks like the return of family rule and a way to legitimize the two rival families. It also appears to be more of the same for ordinary Libyans as the deal focuses on power-sharing between elites rather than how the state can deliver for its citizens. Reports reveal scale of corruption in Libya Two recent reports released by a coalition formed between Libya’s Audit Bureau and its National Anti-Corruption Commission highlight the cost for Libyan citizens of the co-existence between the Haftars and the Dabaibas and the vested interests of politicians and armed groups. The initiative has been supported from the outset by Chatham House which has provided guidance on the development of the coalition’s programme. The reports look at the supply chains that manage the provision of subsidized fuel and subsidized medicine, respectively. They make for grim, but important, reading. Related work Escaping the cycle of conflict in Libya The provision of fuel has been a major source of controversy in Libya in recent years. In 2022, a change in leadership of the National Oil Corporation – brokered between the Haftar and the Dabaiba families by the UAE – led to a rapid expansion in fuel procurement. Despite being an oil producing country, Libya has a deficit of refining capacity, which means it must import fuels for its domestic market. Famously, petrol is provided at the pump at a cost of $0.02 a litre. But the report reveals that the cost of the subsidy has become astronomical. The report found that the import bill had reached over $9 billion by 2024, the equivalent of nearly $1,200 per person in Libya. The volume of imports had more than doubled since 2021, an increase not justifiable by any reasonable estimation of market demand. The report details all aspects of this supply chain, revealing the problems of Libya’s fragmented state. Assessment of demand for fuel was found to lack a ‘scientific’ basis, with Libyan state agencies demanding ever greater quantities for which they rarely paid. Libya’s patchwork of state-affiliated armed groups increased their diesel consumption by 1,527 per cent in 2024 compared to 2021, while consumption at Tripoli South Power Plant increased by 1,368 per cent. These findings point towards a reality where vested interests are controlling lucrative flows of goods, a significant proportion of which are likely sold on the black market at much higher rates or smuggled internationally. And it is not only Libyan elites who benefit, there is also an international dimension to such activities. The number of suppliers of imported fuels was cut from 17 in 2021 to just six in 2024 and the report raises several significant regulatory concerns over these – mostly newly created – foreign companies. The report highlights that the prices paid by the Libyan state for its fuel became increasingly uncompetitive as the number of suppliers shrunk. For example, the increase in the cost, insurance and freight premium for diesel increased by 450 per cent, resulting in a near $600 million loss in 2024 alone. The report on the supply of medicines illustrates strikingly similar dynamics, finding that there is no national framework regulating medicines supply and that the estimation of needs is based upon a ‘speculative’ methodology. The system for registering pharmaceutical companies was found to be deeply flawed. The report noted that a small number of companies had grown exponentially in terms of profit and market share in recent years. Some were found to have direct ties to state officials and members of parliament. This represents a direct conflict of interest, as it is these same officials and parliamentarians that shape the very procurement policies from which the companies benefit. The limitations of power-sharing Related work Rethinking political settlements in the Middle East and North Africa So, how is this relevant to attempts to form a unified government? The rationale behind the need for the unified government is that it will bring a stability from which economic development can emerge, particularly in the oil sector. The report on fuel is particularly relevant in the context of the US push for unity. Boulos is seeking to scale up US investments in Libya’s oil sector if the two rival factions work together. But the findings of the reports throw into question whether simply formalizing the modus vivendi between rival players in Libya would really constitute a basis for development. Power-sharing might simply make corruption worse by reducing existing constraints on rising state expenditure. It would also not be a positive outcome for international oil companies, who are reluctant to make significant capital investments in a market where legal enforcement comes at the whim of feuding ruling families whose competition would likely continue inside the new government. A key lesson of the anticorruption agencies’ reports is that looking at the operating system of Libya’s governing authorities is critical, and that there must be clear conditions as to how any future government should manage the state’s finances. These conditions must include greater transparency and emphasis on the provision of public services, not private enrichment. The fact that a US-mediated unified budget for Libya agreed in April has not yet been meaningfully implemented shows that political breakthroughs without an implementation plan do not change realities on the ground.