Financial expert Khaled Al-Zantouti penned an article criticizing the recent statement by the International Monetary Fund (IMF) regarding Libya, describing it as “economic hypocrisy” and filled with “hollow recommendations.”
Al-Zantouti highlighted the IMF’s acknowledgment of Libya’s “positive turning point after a decade of board stagnation,” questioning the organization’s silence and inaction during those ten years. He pointed out that despite annual meetings under Article IV regarding Libya, the IMF failed to push for urgent reforms to address the governance freeze.
He also criticized the IMF’s statement calling for “a more organized leadership transition to enhance stability and improve governance,” arguing that such flaws in governance have been evident for years. Al-Zantouti emphasized the IMF’s failure to introduce actionable programs to enhance governance during its previous meetings.
Regarding the recurring recommendation to “control spending,” Al-Zantouti labeled it as generic and ineffective. He urged the IMF to provide specific operational advice, detailing which expenditures should be curbed, their responsible entities, and the mechanisms to achieve this—similar to its tailored guidance for borrowing countries.
The article also challenged the IMF’s reliance on Libya’s oil revenues as a basis for economic growth. Al-Zantouti argued that the organization should advocate for income diversification strategies instead of continued dependence on oil, a volatile and politically sensitive resource, offering practical suggestions to achieve this goal.
Finally, Al-Zantouti criticized the IMF’s praise for the Central Bank of Libya’s efforts to facilitate access to foreign currency. He warned that this ease of access, without proper regulation and effective monetary policies, could have adverse long-term effects on exchange rates and both macro and microeconomic stability.
