The United States has lifted economic sanctions imposed on Libya nearly two decades back as a reward for Tripoli's cooperation in repudiating weapons of mass destruction.
The easing of restrictions imposed in 1986 as well as in 1996 under the Libya Sanctions Law comes after Libyan leader Moammer Gadhafi agreed to toe the Washington line and decided to eliminate WMDs, pledged to halt all support for terrorism and signed the International Atomic Energy Agency Additional Protocol.
"Since December 19, Libya has taken significant steps in eliminating weapons of mass destruction programmes and longer range missiles, and has reiterated its pledge to halt all support for terrorism," White House press secretary Scott McClellan said in a statement on Friday.
The clearing of restrictions will allow US firms and individuals to resume most commercial activities, financial transactions, and investments in the Libyan oil industry.
"US companies will be able to buy or invest in Libyan oil and products. US commercial banks and other financial service providers will be able to participate in and support these transactions," the statement said.
The state department will establish a liaison office in Tripoli, a step towards normalising diplomatic relations, and as a result of lifting of commercial restrictions, Libyan students will be able to study in the US, it said.
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