KAI RYSSDAL: There's news from Europe today of an unusual trade deal. The headlines mentioned something about Bulgarian medical workers being released after eight years in a Libyan jail. And there were vague references to closer cooperation between the European Union and Moammar Qaddafi in return for the clemency.
So we've got Marketplace's Stephen Beard on the line from London for more on this story. Hello, Stephen.
STEPHEN BEARD: Hello, Kai.
RYSSDAL: Let's get straight to it, then. Did any actual cash change hands for this release?
BEARD: We know that money played a part, but it's not entirely clear whose money it was. You may recall that the medics' death sentence was commuted to life imprisonment last week. And that was a result of $1 million in compensation being paid to each of the 438 families involved. Now, Libyan sources say that the E.U. and France, in particular, made a contribution to that. Both the E.U. and France deny it. There have been other suggestions, though. Bulgaria and other former Communist states in Eastern Europe forgave some of Libya's foreign debt. But whatever the truth of the matter, we can be sure that economics is certainly a key feature of this story. Libya and Europe hope to benefit economically from this deal.
RYSSDAL: Define your terms for me, Stephen. How do they hope to benefit economically, then?
BEARD: Europe wants a big slice of the contracts to modernize and build up Libya and its oil industry, while the Libyans want greater access to the European market for Libyan exports, which are primarily oil and gas but also agricultural produce and other raw materials. And Libya wants and needs a lot of foreign investment and technical help to upgrade its oil industry which, you know, clearly after all these years of isolation is in a pretty poor state.
RYSSDAL: Is there a dollar amount here, Stephen, that you can put on this arrangement?
BEARD: It's difficult to put a precise figure on it. I mean, we're talking about oil and gas — two very valuable commodities today. I mean, at the moment, Libya is pumping about 1.5 million barrels a day — which hardly puts it in the Saudi Arabian league. But the country is sitting on oil reserves, proven oil reserves, of at least 30 billion barrels. And analysts say that with modern technology they could uncover very much greater quantities. Now, Libya, in terms of hard figures is talking about attracting about $30 billion worth of foreign investment over the next few years in order to double its capacity to about 3 million barrels a day.
RYSSDAL: Let's play the geopolitical card, here, for just a second. Obviously, the Europeans want in on the Libyan market. What about the United States and oil companies here? Who's better positioned to take advantage of this deal?
BEARD: The U.S. in terms of developing the oil and energy resources, because of their technological lead. But European companies are in there, too. And the Libyans are very interested in forging closer political and economic links with Europe because Europe is right on their doorstep. A clear sign of the competition to come, though, comes with President Sarkozy of France, whose wife assisted in today's release, announcing that he's going to Libya tomorrow to, in his words, "To help Libya rejoin the international community." Well, knowing the self-interest of the French, we can be pretty sure he'll come home with a contract or two in his back pocket.
RYSSDAL: Stephen Beard at the Marketplace European Desk in London. Thank you, Stephen.
BEARD: OK, Kai.