Al-Shahoumi: “The Central Bank’s Statement Is an Opportunity and Rich Media Material to Discuss and Examine Our Reality and Its Causes”

The economic expert Sulaiman Al-Shahoumi wrote:
“Every time the monthly statement of the Central Bank of Libya is released, it becomes an occasion for logical and rational discussion among experts. It is also an opportunity and rich media material to explore and analyze our reality and its causes, as well as the appropriate opinions and solutions in the face of a situation that is easy to explain, yet extremely difficult to mitigate its consequences or heal its wounds.”

Despite being the only document that informs us monthly about government spending, revenues, and the use of foreign currency, the Central Bank’s monthly statement increases ambiguity and confusion. It takes us into side paths, far from its core role—one that seems to be facing greater challenges with each passing day.

In reality, given its function, law, and primary role in the economy, the Central Bank is responsible for presenting the economic situation with its various dimensions—traditionally provided through its quarterly bulletin—and for measuring economic stability. It must also show how it uses monetary policy tools to maintain stability based on key indicators, including banking indicators such as money flows, money supply, the activity of the money market between banks and the Central Bank, interest rates and their movements based on financial and economic conditions. Instead, the Central Bank has shifted into a publisher of spending and revenue data, presenting this information however it chooses.

The latest monthly statement indicates a decline in oil-sales revenues transferred during recent months. This leaves the reader in significant confusion and concern.
Is this because some revenues are being withheld and not transferred to the Central Bank? Who would benefit from doing so? Why is this ambiguity not clarified, especially through reconciliation with the National Oil Corporation—which has stopped publishing data on export volumes and values—deepening this uncertainty? Or is the decline simply due to a global drop in oil prices, which seems more likely? In either case, proper justification must be provided.

There is no doubt that presenting reports of national economic relevance requires coordination and harmonization among economic institutions in both content and timing—whether the National Oil Corporation, the Ministry of Finance, the Audit Bureau, or the Central Bank.

As for the issue of declining and utilizing Central Bank reserves to cover the gap between revenues and foreign-currency demand—and the fact that reserve values have increased overall due to rising gold prices—this does not realistically align with basic principles of caution when dealing with global price fluctuations. It also reveals a change in how the Central Bank calculates its reserves, which for decades did not revalue gold holdings or investments based on market prices. This raises a question: Why has the Central Bank not disclosed the reasons behind this cautious change in valuation methodology? And is it seeking to inflate reserve assets to send a certain message about the sustainability of reserves now that global gold prices have risen?

Meanwhile, the report avoids addressing the extremely difficult reality of cash shortages and the soaring demand for foreign currency—issues the Central Bank has found itself trapped in due to the disruption of its ability to manage monetary policy smoothly and professionally.

The monthly report notes a surplus between government revenues and expenditures. However, this also sends a very unclear signal because it only accounts for the spending of one of the two governments. The Central Bank did not provide—even minimally—a monthly breakdown of how much it finances the other government, leaving us without a clear understanding. From time to time, it only informs us of the increasing public debt that the Central Bank alone continues to finance.

There is no dispute that the Central Bank of Libya operates under harsh and chaotic conditions, but that does not exempt it from presenting all information transparently and in a timely manner.