Canada has assessed the situation on the ground and is ready to re-open its embassy in Libya's capital, Foreign Affairs Minister John Baird said Tuesday.
Baird confirmed reports that a small team of diplomats has been in Tripoli since the weekend, surveying the situation.
"Having now taken stock of the situation we're starting the work of refurbishing and securing our embassy in Tripoli," Baird told reporters in Ottawa.
He said the team is setting up an embassy in a temporary location until the original location can be re-opened. Sandra McCardell, who was Canada's ambassador to Libya prior to civil war breaking out earlier this year, has been leading the team.
Baird said the team is liaising with officials in Libya's National Transitional Council, and preparing for the arrival of a larger complement of diplomats who will focus on the resumption of trade relations between Canada and Libya.
Baird also said Canada has obtained an exemption from the United Nations Security Council's sanctions committee to free up more than $2 billion in frozen Libyan assets to use for humanitarian needs such as hiring police officers, teachers, restoring the flow of electricity and water and providing hospital resources.
"Canada is proud to have punched above its weight by leading the way in providing humanitarian, diplomatic and military support to the Libyan people and their cause," Baird said.
"We now expect a new government to fulfill its commitments to freedom, to democracy, human rights and the rule of law."
There are still pockets of resistance in Libya, where fighters loyal to former dictator Moammar Gadhafi refuse to acknowledge the rebels' status. Though Gadhafi's 40-year dictatorship has been broken, the former general himself still remains at large, his wherabouts unknown.
Canada participated in the NATO-led, UN-mandated bombing campaign of Libya, which was designed to protect civilians from military attacks by Gadhafi troops.
Canada was also among several dozen countries that recognized the Libyan rebels as the true representatives of the country this past spring.
Baird met with the National Transitional Council (NTC) in June in Benghazi, a rebel stronghold, however he did not establish a diplomatic outpost in the eastern Libyan city, as a number of other NATO allies did.
A senior Canadian official told CP the time is now right for Canada to re-establish an official presence in Libya.
"By re-establishing and resuming operations at Canada's embassy in Tripoli, this will provide us with a diplomatic presence in Libya," said the official, who spoke in advance of the minister's announcement, on the condition of anonymity.
"Canada is in a strategic position to strongly promote Canadian values and protect Canadians' interests," the official added.
The official also suggested Ottawa has high expectations for the Libyan rebels and wants to see a true democracy established in the country that has been under dictatorial rule for 40 years.
Canada could benefit from increased stability in Libya. The Calgary-based oil company Suncor was producing 50,000 barrels a day out of Libya prior to the civil war, and SNC Lavalin was working on a number of projects from building a prison to installing a water-supply system.
Prime Minister Stephen Harper, who attended meetings on Libya in Paris recently, has said he received assurances that the NTC would honour existing contracts with Canadian companies.
With files from The Canadian Press
