The rollback of sanctions imposed in 1986 and 1996 allows the resumption of most commercial activities, financial transactions and investments, and lets U.S. companies buy or invest in Libyan oil and products, according to a statement from the White House.
Mr. Bush also withdrew the U.S. objection to Libya entering the World Trade Organization.
The U.S. decision followed Libyan leader Moammar Gadhafi’s Dec. 19 announcement that his country would cease pursuing chemical, biological and nuclear weapons.
“Through its actions, Libya has set a standard that we hope other nations will emulate in rejecting weapons of mass destruction,” the White House statement says. “Libyan actions since December 19 have made our country and the world safer.”
Gadhafi also has garnered international support for accepting responsibility for the 1988 Pan Am 103 bombing over Lockerbie, Scotland, and pledging $2.7 billion to compensate the families of the airliner’s 270 victims.
Libyan government assets in the United States will remain frozen, however, and air travel and aviation cooperation will still be restricted, U.S. officials said, according to Reuters.
Libya also still remains on the U.S. list of state sponsors of terrorism, and the White House said in its statement Friday that “the necessity of ending any tie to terrorist groups or activities will continue to be a central issue in relations with Libya,” the Associated Press reported.