Behind Gaddafi's Diplomatic Turnaround

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Libyan leader Muammar Gaddafi during the Arab Summit in Khartoum in March

Ever since Monday's announcement that it was restoring full diplomatic relations with Libyan leader Muammar Gaddafi, the Bush Administration has suggested that the onetime international pariah's decision to dismantle his weapons of mass destruction program was primarily the result of the U.S. war on terror and its toppling of Saddam Hussein. But for a brief moment in December 2003, the actual capture of the Iraqi leader almost delayed the first public sign of the historic rapprochement between Libya and the West.

Gaddafi's son Seif al Islam and government officials had spent months in secret negotiations with representatives of both the CIA and the British secret intelligence service MI6, working out the parameters of a deal in which Libya would give up its nuclear ambitions. But on Dec. 14, only a few days before an official announcement was to be made in Washington, Hussein was pulled out of a spider hole and Gaddafi had last-minute jitters. Worried that the humiliating capture of Saddam would be viewed as the driving force behind his voluntary disarmament, Gaddafi suddenly proposed a postponement. According to his son Seif al Islam, British Prime Minister Tony Blair pleaded with Gaddafi, "Please, we are in a hurry. It is a big success for all of us." The personal diplomacy worked, and an announcement was made on December 19 that Gaddafi had agreed to dismantle his weapons. Ten months later, after Western agents had worked to remove all the components of Libya's WMD program and dismantle its long-range ballistic missiles, Blair sent the Libyan leader a friendly letter of congratulation, addressing him as "Dear Muammar" and signing off, "Best wishes, Yours ever, Tony."

Blair's tone may have been affectionate and familiar, but the drawn-out process that led to Muammar Gaddafi coming in from the cold wasn't always so warm. At one point, Seif al Islam recalls, his father "suspected an ambush" by the West: getting him to give up his only deterrent but withholding diplomatic rehabilitation. A series of TIME interviews that began before Sept. 11 with Gaddafi himself, his influential son and key Libyan officials offer a unique look into the Libyan view of the secret talks and considerations that led to Gaddafis staggering reversal of fortune.

As early as February of 2001, Gaddafi told TIME that he was dramatically shifting Libya's strategic orientation, seeking normal relations with the West and an alignment with Africa rather than the Middle East. "I supported all liberation movements fighting imperialism," he said in February 2001, "but I believe that is over now." In a TIME interview in January 2005, he went further: "There is never permanent animosity or permanent friendship. We all made mistakes, both sides. The most important thing is to rectify the mistakes."

While Gaddafi indicates that geopolitical shifts like the collapse of the Soviet Union, the Palestinian decision to negotiate with Israel and the increasing spread of Islamic extremism forced him to change course, he believes that it was his atomic bomb program that enabled him to deal with the West from a position of strength. Even today, he concedes nothing in Libya's support for terrorism, bragging about how revolutionaries he aided like Nelson Mandela and Yasser Arafat became welcome visitors to the White House. Libya's regret, he says, is that some of the groups committed the error of killing innocent civilians. Although a Scottish court convicted a Libyan official — and the Libyan government formally accepted responsibility — for the downing of a Pan Am flight over Lockerbie, Scotland, in 1988, Gaddafi still refuses to admit Libyan guilt, insisting that the real perpetrators have not been caught.

Despite President Bush's avowed goal of spreading democracy in the Middle East, Gaddafi's hold on power may be stronger than it was two decades ago, when President Reagan denounced him as a "mad dog" who threatened global security with a "reign of terror." In 1986, in response to a terrorist bombing in Berlin that killed two American servicemen, U.S. aircraft bombed targets, including Gaddafi's home, in what amounted to an aerial assassination attempt.

One of the remarkable things about Gaddafi's political transformation is how he achieved it with the help of two institutions that fed his greatest paranoia about the West: Britain's Secret Intelligence Service, MI6, and the U.S. Central Intelligence Agency. Gaddafi personally met with top British and American spooks, including the then CIA covert operations deputy chief Stephen Kappes, who is now the leading candidate to become CIA Deputy Director under incoming head Michael Hayden. The Libyan leader became on a first-name basis with them and his officials took them out to Tripoli's faded restaurants.

Gaddafi had taken heart from the willingness of the U.S. and Britain to reach a compromise agreement over Lockerbie. As those negotiations neared their conclusion with a partial lifting of sanctions, Seif al Islam secretly met with three MI6 officers in a hotel room in Londons posh Mayfair district late one Sunday afternoon in March 2003. (An aide to Palestinian leader Yasser Arafat, Mohammed Rashid, arranged the rendezvous.)

Seif al Islam opened the discussion by saying that Libya proposed a strategic dialogue on mutual concerns starting with extremism. He recalls their surprise when he quickly agreed that Libya could begin by making a sincere effort to address WMD concerns. Seif al Islam says they reciprocated by immediately obtaining Blair's promise to deal with Libya in good faith. "When they called 10 Downing Street," he recalls, "they said, 'Don't fall off your chair. We got something from the Libyans.' It was a total surprise to them."

An equally important breakthrough came the next day when he flew to his father, who was on a state visit to Burkina Faso, and received his blessing for the initiative. "I will see if we can be friends," he quotes his father saying over a lamb and rice lunch. Gaddafi dispatched foreign intelligence chief Musa Kusa to Geneva in mid-April for a meeting with top MI6 and CIA officials, who traveled secretly to Tripoli in September for a face-to-face with Gaddafi himself. The Libyans agreed in principle to throw its WMD projects wide open to an MI6-CIA team of technical experts. But besides the distraction of the Iraq War, progress was held up by Gaddafi's insistence on guaranteed incentives — like military cooperation and a complete end to sanctions — if Libya followed through and not only admitted but dismantled its WMD programs. When Gaddafi grew nervous, Seif al Islam says he reassured his father about the West's intentions, telling him, "'Trust me.'" As he recalls his own faith in the process, he claims, "I could smell it."

Seif al Islam says that Gaddafis confidence grew as the number of messages from the British and U.S. governments came in via MI6 and the CIA. The key breakthrough occurred on Sept. 6, 2003, when a British air marshal flew in to Tripoli on a Royal Air Force plane and handed Gaddafi a personal letter from the British Prime Minister formally agreeing to Gaddafi's conditions for proceeding. That paved the way for the visit of the MI6-CIA technical team to inspect all of Libya's top-secret WMD sites and report back to their governments.

But before they could arrive, the secret negotiations were thrown in jeopardy when Italian authorities, acting on information from U.S. officials, seized the BBC China cargo ship in the Mediterranean carrying thousands of components for Libya's illicit uranium-enrichment facility. As only a handful of top U.S., British and Libyan officials knew about the secret talks, the discovery provided the public with smoking gun proof of Libya's covert nuclear program. According to Seif al Islam, MI6 officers immediately flew from London to Tripoli to assure the Libyans that the incident need not affect the secret disarmament plans. The seizure added pressure on Libya to come clean, Seif al Islam admits, but the lack of bullying by MI6 and the CIA reassured Gaddafi. "We realized that we were dealing with friends and sincere people," Seif al Islam says.

Had it not been for inconvenient Saudi Arabian accusations that surfaced in 2004, Gaddafi's complete rehabilitation might have come well before Rice's announcement this week. In what read like a page from Gaddafis "mad dog" days, Saudi officials said they had arrested a senior Libyan intelligence officer in November 2003 who confessed to organizing a plot involving Saudi dissidents to fire a missile at then Crown Prince Abdullah bin Abdulaziz al Saud's Mecca residence. Gaddafi told TIME that the allegations were "a fabricated case, an intentionally destructive thing."

Seif al Islam dismisses the assassination charges, but acknowledges that the Libyan agent was part of an effort to provide support to Saudis opposed to the Al Saud regime. Libya, he contends, has longstanding complaints of its own about Saudi support for Libyan Islamic extremists, including one who tossed a dud hand grenade at Gaddafi in 1995. Libyan support for Saudi dissidents accelerated after Abdullah scolded Gaddafi at an Arab summit in March 2003 during a session broadcast live throughout the Arab world. "You can say there was an activity," says Seif al Islam, "but not to kill the crown prince. [The Libyan who supposedly organized the plot] is arriving there like James Bond?" After Abdullah became King in 2005, he effectively helped complete Gaddafi's rehabilitation by downplaying the Mecca case. In her statement Monday, Rice cited Libyas continuing "excellent cooperation" in fighting international terrorism.

Rice's announcement represents a stunning achievement for Seif al Islam, a driving force behind the risky venture of reaching out to the West. He has also been an influential — and at times almost solitary — advocate for reform and human rights in Libya. Sitting on a sofa in his private gym, he described frank discussions with his father — "there is a margin for exchanging views" — but reveals the gap is wide.

"I want shock therapy, to destroy everything and build it back up, and to not waste time," he explains. "He is in favor of gradual reform. He is a utopian, leading a state like the wise man of a village. That's where I say, 'Life is more complicated than this.'" Seif al Islam is anxious to end speculation that he'll get his own chance to lead Libya some day. He rules out succeeding his father "100 percent," saying his goal is limited to encouraging a civil society as part of Libya's democratization process. No interest at all? "Zero," he replies.

Sitting in his Bedouin tent in Tripoli a year ago, Gaddafi clearly fancied himself a man of the future, not a revolutionary dinosaur. An avid Web surfer, he tapped a thick finger on a keyboard and stared into the glow of a flat screen computer. He likes the English news on Google but had trouble maneuvering there on the day TIME paid him a visit. Instead, he clicked on one of his Favorites, a site called Gaddafi Speaks. "You have my views on reforming the United Nations, the problems of Palestine, Korea and Turkeys admission to the European Union," explained Gaddafi, now 64 and marking 37 years as the Leader. "I consider the Internet a podium for delivering speeches."

Looking up from his computer, Gaddafi showed no inclination to surrender the role of philosopher-king that he began playing seven American presidents ago, during the first Nixon Administration, when he authored the Green Book, his idiosyncratic alternative to the theories of capitalism and communism. "I wish the whole world would read the Green Book thoroughly and profoundly," he said without irony. "Idealists in this world are very few."

But his attachment to the old and familiar, it appears, extends even to his choice of automobile. Back in 1969, the young army colonel who led the conspiracy against King Idriss, smuggled men and weapons around Libya in a battered turquoise Volkswagen Beetle, which is a popular Libyan National Museum exhibit. So it was not surprising that when Gaddafi said goodbye to his visitor and climbed into the passenger seat of a waiting car, it was a brand-new, metallic blue VW bug.

With reporting by Amany Radwan/Tripoli