Libya's UN envoy appealed to Switzerland Wednesday to rescind a "blacklist" of 188 Libyans, including leader Muammar Gaddafii, banned from entering Swiss territory over a festering diplomatic row.

Ambassador Abdulrahman Mohammad Shalgham told reporters at Libya's UN mission that Tripoli was calling on Bern "to cancel this blacklist and to go to arbitration" to resolve the dispute.

"We want a solution. We are ready to accept any verdict" from the arbitration panel, he added.

The two countries have been embroiled in a diplomatic row since July 2008 after the brief arrest in Geneva of Gaddafi's son Hannibal when two hotel workers complained he had mistreated them.

The dispute escalated when Libya detained two Swiss businessmen.

Switzerland hit back by issuing the blacklist.

Last year, 270 visa applications from Libyans seeking to enter Europe's 25-state Schengen free-travel zone were rejected at Switzerland's request, out of a total of 30,000 requests, according to the Swiss migration office.

Libya recently retaliated by announcing it was denying entry visas to citizens of European countries belonging to the Schengen zone.

It also ordered "a total embargo on all economic and commercial exchanges with Switzerland."

"It's reciprocity until they (the Swiss) cancel this blacklist," Shalgham said, noting he and even his son were on the list along with several Libyan ministers and other top officials.

"What we want from Switzerland is that they respect our citizens. There are rules. There is immunity for diplomats," he added.

The ambassador noted the dispute was affecting Libya's trade relations with friendly European Union countries because of the retaliatory ban on entry visas for Schengen-area nationals.