The latest in a long line of Western nations to do so, the Obama Administration today announced that it is formally recognizing the East Libyan rebel faction as the “legal government” of Libya.
The recognition in and of itself likely will mean very little, except for establishing formal diplomatic ties with the rebels as a government instead of simply a rebel faction. This is particularly meaningful since the US and its allies are currently bombing the nation.
But the real significance could be a financial one, as billions of dollars in assets frozen by the US and other western nations, including the personal assets of Moammar Gadhafi, could soon be transferred to the self proclaimed leadership council of the rebels.
The funds could help the rebels in fighting the civil war, but any government funds used in the conflict will not be available for post-war reconstruction. Given NATO’s recent proclivity toward attacking Libya’s oil infrastructure, this could be extremely expensive.