Homeland Security

DATE=9/1/2003

TYPE=CORRESPONDENT REPORT

TITLE=FRANCE / LIBYA (L)

NUMBER=2-307043

BYLINE=DOUGLAS BAKSHIAN

DATELINE=LUXEMBOURG

CONTENT=

VOICED AT:

INTRO: France says it expects Libya and the families of 170 people killed in the 1989 bombing of a French airliner over Africa to sign a compensation deal soon, clearing the way for the end of U-N sanctions on Tripoli. Douglas Bakshian reports from Luxembourg.

TEXT: French Foreign Minister Dominique de Villepin told French R-F-I radio that the government has reached a compensation agreement in principle.

Libyan leader Muammar Gaddafi announced an agreement Sunday on a compensation deal for the bombing of a French U-T-A jet over Niger in 1989.

Mr. De Villepin also indicated Paris could allow the Security Council to pass a British resolution lifting sanctions against Libya. France has the power to veto the measure.

Responding to a question from the French radio, Mr. De Villepin said France has always said it backs the principle of lifting sanctions. But it had threatened to hold up a British proposal to that effect unless its own compensation claim has been satisfied.

Libya has already paid 34-million dollars to France, but never admitted liability.

Britain moved to end U-N sanctions on Libya after Tripoli agreed last month to pay two-point-seven-billion dollars to families of the 270 people killed in the 1988 bombing of a Pan Am jetliner over Lockerbie, Scotland.

The sanctions include a ban on arms sales and air links with Libya. They were suspended in 1999 after two Libyans were turned over to be tried for the Lockerbie bombing.

France had threatened to block the action unless Libya increased payments for the U-T-A bombing. (SIGNED)

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