Homeland Security

DATE=3-11-03

TYPE=CORRESPONDENT REPORT

TITLE=US-LIBYA / LOCKERBIE (L)

NUMBER=2-300577

BYLINE=DAVID GOLLUST

DATELINE=STATE DEPARTMENT

CONTENT=

VOICED AT:

INTRO: The United States is reporting progress in talks with Libya on compensating the families of the 270 people killed in the 1988 bombing of Pan Am flight 103 over Lockerbie, Scotland, though the State Department says reports of an agreement are "premature." A senior U-S envoy is returning to Washington from the compensation talks in London, and will meet family members Wednesday. V-O-A's David Gollust reports from the State Department.

TEXT: Officials here are not ready to say the matter has been settled. But the progress in talks with Libya is said to be considerable, and sufficient to merit a special meeting between the State Department and representatives of the families on Wednesday.

The United States and Libya, with British participation, have been holding talks on and off for several years on compensation for the bombing of the jumbo jet of the now-defunct U-S airline Pan Am, an attack for which a Libyan intelligence agent was convicted in a special court in the Netherlands in 2001.

An agreement would open the way for the lifting of U-N sanctions against Libya and possibly also to an end to U-S economic penalties against the North African state and its listing by the State Department as a sponsor of terrorism.

Assistant Secretary of State for Near Eastern Affairs William Burns led the U-S delegation at the latest round of talks, which ended late Tuesday in London.

Briefing reporters here, State Department spokesman Richard Boucher said there was progress but that the administration was awaiting a first-hand report from Mr. Burns before deciding whether, among other things, Libya has met U-N requirements for ending sanctions:

///BOUCHER ACTUALITY///

This is something where the United States has had a long-standing policy about the need for Libya to meet all the requirements of the U-N resolution. Any progress that was made will have to be evaluated against those standards and I'm sure it will be given the appropriate attention within the U-S government. But I don't want to pre-suppose at this point that there is some kind of agreement. I'm not in a position to describe it that way today.

///END ACT///

Though there has been no official word on the terms of a possible deal, Libya was reported last year to have offered a two-point-seven billion dollar settlement package ten million dollars to the family of each victim to be paid in steps as United Nations and U-S sanctions against Libya are dropped.

A senior official who spoke to reporters here said it is basically up to the families to decide the terms of compensation. He said the U-S government's main interest is seeing Libya acknowledge responsibility for bombing the plane and cooperating in the investigation of the case by releasing all relevant information.

The official said press reports from London of an agreement with Libya were "premature," but he said Mr. Burns would personally brief the family representatives Wednesday on the "good" progress made in the latest round of talks. (Signed)

NEB/DAG/MAR