Esoteric Armour (
LINK) thinks they were sold directly by the US before the sanctions. They think this because the Libyan M113s are apparently very early models and because SIPRI (Stockholm International Peace Research Institute) lists a sale for 1966.
I've been wondering, when did Libya get M113s? They weren't exactly one of the US's favourites after Qaddafi came to power... <...>
Oh, but that was soooo last millennium. After he renounced terrorism (1999) and stopped developing WMDs (2004), he didn't exactly become a full-blown member of the Good Lads Club, but was sorta let in through the back-door. More or less quietly. Sanctions were lifted, oil and gas were sold to Europe, arms were sold to Libya ("worth several hundred million EUR per year", according to an Austrian newspaper), there were even talks of building a nuclear power plant in Libya (in exchange for development/exploitation of uranium ore mines). Then Qaddafi became an ally in the War on Terror. Convenient for Qaddafi, who had problems of his own with Islamic groups, convenient for everyone else because, well, not many questions were asked. And Qaddafi was handy in keeping Africans from getting across the Mediterranean into Europe. By the end of the 2000s, it was almost as if nothing every happened between Qaddafi and the West.
Actually, looking at it now, it's kinda surprising to see how fast everyone dropped him again in 2011. Suddenly they were shocked to hear about his human rights record?