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Libya
Italy
Italy was one of Libya's major trading partners in the late 1970s.
Relations with Italy, however, have been somewhat mercurial. In
1973 Libyan aircraft strafed an Italian combat vessel patrolling
an area in the Mediterranean where an earlier dispute had led
to the detention of Italian fishing trawlers. Libya officially
apologized for the strafing incident and relations improved in
1974 with Jallud's visit to Italy and the conclusion of several
commercial and technical agreements. However, there were three
more incidents involving Italian fishing boats operating near
the Libyan coast in December 1975. Earlier that year, British
press reports alleged that Libya was funding radical Italian political
groups.
Despite these frictions, relations improved in 1975 because agreement
was reached regarding compensation for property lost when Italians
left Libya under pressure after the 1969 revolution. A major commercial
transaction was completed in December 1976; Libya purchased more
than 9 percent of the stock of the Fiat Company, placing 2 representatives
on Fiat's 15-member board of directors in the process. Increasing
pressures were brought on Fiat, Italy's largest privately owned
firm, by the Italian government and Western interests to buy back
Libyan-owned stock shares, which by 1986 amounted to a 15.2-percent
share in the firm. The Libyan government-owned Libyan Arab Foreign
Investment Company agreed to divest itself of the stock in September
1986, presumably to generate revenue of over US $3 billion to
compensate for lower Libyan oil revenues.
Data as of 1987
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