By Sue Pleming WASHINGTON, Oct 3 (Reuters) - Tripoli is tapping U.S., Libyan and other companies to put money into a humanitarian fund for U.S. victims of terrorism, a senior Bush administration official and another source said on Friday. The fund, agreed on in August by the United States and Libya to settle terrorism cases on both sides, still has no any money in it but a senior U.S. official said he was confident Tripoli would fulfill its obligations. "They (the Libyans) are out there raising their funds," said the senior official, who spoke on condition he not be named because the issue is sensitive. The onus is on Libya to put an unspecified amount into the fund, which is estimated to be worth a total of $1.8 billion, before payments can be made. Both sides have refused to say where the money will come from but Washington has insisted no U.S. taxpayer money will be used. "They have called in a lot of companies, apparently. I don't know what they expect to get from them," the official told Reuters when asked whether Libya was tapping companies. Another source who closely tracks the issue said Libyan ministers had in recent weeks called in representatives from U.S., French and other international firms as well as Libyan companies, to put pressure on them over the fund. The Libyan Embassy in Washington could not be reached for comment. Agreement on the fund paved the way for U.S. Secretary of State Condoleezza Rice to visit Libya last month -- the first by a top U.S. diplomat to the former pariah state in half a century and a tangible sign of improved ties. The dispatch of a U.S. ambassador to Libya is also tied to the fund and U.S. lawmakers have held up the appointment of the envoy, Gene Cretz, until Tripoli pays up. Appointing a U.S. ambassador, which has to be agreed on by the Senate, was seen as one of the rewards for Libya giving up its weapons of mass destruction program in 2003, which led to the warming of ties between the former foes. OPTIMISM The senior official said Washington was optimistic the Libyans would get money into the fund by the end of the Bush administration, whose term is over in January. "They are committed to the agreement. On the basis of some evidence, I think they are trying to gather the funds," he added. "I can't put a schedule on it." But the U.S. official stressed the United States was not itself pressing companies to put money into the fund. "They are not barred voluntarily from participating. No one is. We don't want them pressured to do that," he said. "It is such a considerable sum of money I think that resources are going to have to come from a range of sources," he said. American victims covered by the fund include those who died in the 1988 bombing of Pan Am Flight 103 over Lockerbie, Scotland, which killed 270 people, and the 1986 attack on a West Berlin disco that killed three people and wounded 229. It also provides compensation for Libyans killed in 1986 when U.S. planes bombed Tripoli and Benghazi in retaliation for the disco attack. Forty people died, including Gaddafi's adopted baby daughter. U.S. Assistant Secretary of Commerce Israel Hernandez left for Libya on Friday to open up a U.S. commercial service office in Tripoli, a move strongly rejected by some families of the Pan Am bombing over Lockerbie. "What business does the U.S. government have spending taxpayer dollars to help line the pockets of Libya's state-run economy, when Libya has not yet honored American victims of its terrorism?," said Kara Weipz, a spokeswoman for the families of the Pan Am victims. A Commerce Department spokesman said Hernandez was traveling to Libya to help companies interested in expanding their exports to the country, adding that these firms faced strong competition from European companies in the Libya market. He said U.S.-Libya trade totaled about $3 billion in 2006, and that Libya had become one of the fastest-growing markets in the world for U.S. exporters across a number of sectors including aircraft, automobiles and agriculture. (Additional reporting by Doug Palmer; Editing by Eric Walsh)
