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Thu 4 Oct 2007 04:12 PM

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Libya wants to invest in US stock market

Country looking to ease ties with the world's superpower after three decades of tensions, minister says.

Libya wants to enter US markets and invest in its bourses in an attempt to ease ties with the world's superpower after three decades of rupture, the Libyan foreign minister said in remarks published on Thursday.

"The first agreement we seek with the US is to maintain and encourage investments between both countries and to enter the American stock markets as well as the American markets in general," Mohammed Abdel-Rahman Shalgam told pan-Arab daily Asharq Al-Awsat.

US-Libyan ties have warmed since Libya gave up weapons of mass destruction in 2003 but have been held back by the absence of final settlements of the 1986 bombing of a German disco and the 1988 bombing of a Pan Am flight over Lockerbie, Scotland.

Libya agreed to pay the families of the Lockerbie victims $10 million per victim but has not made the final payment. It has not reached any deal to pay compensation for US victims of the La Belle disco bombing.

Libya is trying to improve its ties with Western countries following the end of sanctions in 2004 after a it agreed to pay compensation over the Lockerbie bombing.

Shalgam also said his country will give priority to US companies which seek investments in Libya's oil fields.

"American companies are investing billions of dollars in Libya, in the oil field in particular and we in Libya want to privatise the oil section and we think the most qualified investors for this are US companies," he added.

Libya has set itself a target to expand oil output capacity to more than three million barrels per day (bpd) by 2010/12 from about 1.6 million bpd now.

Saif Al-Islam, the son of the country's leader Muammar Gaddafi, said in July Libya plans an enhanced oil recovery round to develop its output through granting licences to Western multinationals.

Libya has held three oil exploration licensing rounds since 2004. Some analysts say the output target is unrealistic.

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