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Author: Amira Cherni

Economic Researcher Discusses UN Report and Widespread Corruption in Libya

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In an exclusive statement to our source on Wednesday, economic researcher and analyst Ahmed Maharem expressed concerns about Libya’s uncertain future due to the dominance of armed groups over oil resources. He highlighted how these groups use revenues from smuggled oil to purchase weapons and fuel instability, which in turn discourages foreign investments.

Maharem also revealed that Libya’s Attorney General is expected to request a fuel budget allocation in March to meet the demands of power stations and ease congestion at fuel distribution stations.

He further emphasized that the UN report pointed to corruption within the General Electricity Company, where revenues have allegedly been misused to fund militant groups. He warned that rampant corruption within state institutions poses a significant threat to Libya’s future.

Exclusive: Central Bank Directs Banks to Accept International Cards on Local POS with a 2.5% Fee Cap

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Our source has exclusively obtained a directive from the Central Bank of Libya to commercial banks regarding the resumption of accepting international payment cards on local point-of-sale (POS) terminals owned by Libyan banks.

This decision aligns with the regulations outlined in Circular No. (2024/17), with a strict requirement that transaction fees do not exceed 2.5%.

Exclusive: U.S. Republican Party Member to Sada—Libya Has Huge Potential, but Corruption Steals from Both Present and Future Generations

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U.S. Republican Party member Ihsan Al-Khatib told Sada Economic Newspaper on Wednesday that Libya faces a political crisis with economic consequences. While corruption exists in all countries, the issue in Libya lies in its scale. He noted that Libya, with its small population and vast oil wealth, has immense potential.

Al-Khatib added that Libya can combat corruption like any other country—with strong laws and proper enforcement.

He emphasized that corruption is essentially the theft of resources from both the Libyan people today and future generations.

He concluded by stating that while the world can offer solutions, only Libyans themselves can truly address their nation’s challenges.

Exclusive: Central Bank Governor Directs Completion of January Salary Transfers and Cash Availability

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The Central Bank of Libya revealed exclusively to our source that its Operations Department has completed the transfer of January salaries for all government sectors this evening.

Salaries will be deposited into citizens’ accounts by relevant sectors and banks, accompanied by sufficient cash availability at all bank branches to ensure continuous withdrawals without interruption.

The Central Bank Governor has instructed continued operations until all salary transfers are finalized, which was completed at 6:30 PM.

Exclusive.. Central Bank Sends a Cash Shipment to Sebha City Worth 52.4 Million Libyan Dinars

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The Central Bank of Libya, on Wednesday, February 5th, dispatched a new cash shipment from Mitiga Airport in Tripoli to Sebha City, carrying 52.4 million Libyan dinars.

This move aims to support the cash reserves of the Central Bank branch in Sebha. The Central Bank will continue sending cash shipments gradually until all Libyan cities receive their allocations, as part of its planned efforts to provide liquidity, in line with the instructions of Mr. Naji Mohamed Issa, Governor of the Central Bank of Libya, and his deputy.

Central Bank Sends 120 Million Libyan Dinars to Support its Branch in Benghazi

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In an exclusive report to our source, the Central Bank of Libya announced the dispatch of a new shipment of cash today. The shipment, carrying 120 million Libyan dinars, departed from Mitiga Airport in Tripoli and is headed to Benina Airport in Benghazi. This move is aimed at bolstering the reserves of the Central Bank branch in Benghazi.

The Central Bank plans to continue sending cash shipments to all Libyan cities as part of its strategy to ensure sufficient liquidity across the country. This effort is being carried out under the guidance of Mr. Naji Mohamed Issa, Governor of the Central Bank of Libya, and his deputy.

Smuggling of Oil, Gold, and Control Over State Institutions: A Report by UN Security Council Experts

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A report by the UN Security Council’s expert panel revealed that pressure was applied on the Audit Bureau, forcing it to approve a contract worth over $200 million for the importation of electricity meters for the General Electricity Company under the management of Al-Mishai. The contract was subcontracted to North Africa Holding for Development and Investment, which, however, barely fulfilled its obligations under this subcontract.

The report also highlighted the influence of armed groups on Libya’s public institutions, including the National Oil Corporation. Armed group affiliates were appointed to leadership positions within the corporation, and the organizational structure was altered to limit internal checks and balances. A new strategic office was created outside the corporation to manage service agreements with private companies, including one with Arknu Oil, the first private oil company in Libya. Under these agreements, Arknu exported six million barrels of crude oil at an average price of $77 per barrel, amounting to $463 million. The report found that Arknu is controlled by Sadam Hafter.

The report further reveals that armed groups now have significant influence over oil revenues and the fuel supply chain, and they control various entities in both the public and private sectors. It mentions the use of a private company to market and sell crude oil outside the traditional oversight of the NOC and the Central Bank of Libya. Additionally, there is evidence of the General Electricity Company buying surplus fuel for illegal exportation, and activities related to smuggling from the Old Benghazi Port, which have enabled armed groups to generate unprecedented revenue from fuel smuggling due to favorable conditions both nationally and internationally.

The report also noted that, in the past two years, fuel smuggling from Libya reached unprecedented levels. Most of the smuggled fuel, particularly diesel, was sold on the black market or through forged documents. Armed groups controlled the fuel smuggling trade, generating steady income from it. The Libyan Arab Armed Forces also gained indirect access to public funds through fuel smuggling from the Old Benghazi Port. Armed groups in Tripoli and Zawiya directly controlled key economic sectors and government institutions related to smuggling a large portion of diesel meant for domestic consumption.

The report mentions a sudden increase in fuel demand by the General Electricity Company, despite the fact that the company doesn’t typically require large amounts of diesel for its operations. Its energy production primarily relies on gas-powered stations, with oil and refined products, like heavy fuel oil and diesel, being used as reserves. Over the course of 2022 to 2023, the company’s budget for petroleum purchases increased by $5 billion, from $3.7 billion in 2022 to $8.7 billion in 2023. This increase was allocated for diesel ($3.5 billion) and natural gas ($4.1 billion), accounting for more than 87% of the company’s total budget for petroleum products in 2023. Despite this additional allocation, electricity production did not rise proportionally. Given that Libyan power plants are capable of dual-fuel use, the amount allocated for purchasing natural gas alone should have been sufficient to meet electricity production needs. According to the National Oil Corporation, the average value of imported diesel in 2023 was $903.58 per ton. This indicates that the company received fuel worth only $2.6 billion, creating a potential gap of $900 million in its budget expenditure. Moreover, the company lacked the necessary storage capacity to manage the fuel it received in 2023, and in 2024, it requested Brega Company to reroute several ships carrying diesel to Western power plants, even though the Benghazi power station does not use diesel as fuel. This situation creates a high risk of large quantities of diesel being diverted.

The report also highlighted the expansion of smuggling activities previously reported from the Old Benghazi Port, with 137 visits by smuggling vessels. Forty-eight ships made over 185 visits to Benghazi, with some ships making as many as 15 visits. The average vessel size increased from 5,700 tons to 9,970 tons of deadweight. Smuggling and disruption patterns have evolved, with ship-to-ship transfers occurring in international waters, mainly in the Herd Bank off Malta. Some ships returned to Benghazi for refueling multiple times during these periods. The total amount of diesel smuggled was estimated at approximately 1.125 million tons, with the actual amount likely being higher.

Additionally, the report revealed a network of 12 other ships, with one individual identified as holding both Greek and other nationalities.

Exclusive.. Al-Sanussi: “Organizing Exchange Offices is an Excellent Decision, Though Delayed, But Procedures Shouldn’t Be Complicated”

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Economic expert, Mohamed Al-Sanussi, stated in an interview with our source that the decision to grant licenses to a group of exchange offices is an excellent one, despite being delayed by at least ten years. The regulation of exchange office operations should have occurred as early as 2013, as the number of exchange offices and currency transfers has significantly increased since that year.

He continued: “Regulating and monitoring the operations of exchange offices will certainly lead to many positive outcomes on one hand, and will also eliminate several negatives, but with certain conditions.

First: State institutions should not rush to close exchange offices that have not obtained a license. I expect that those offices will be shut down, but they should be given a grace period to obtain a license, at least until the end of the year.

Second: Obstacles and difficulties should not be placed in the way of exchange offices that have obtained a license. They should not be forced to operate inefficiently as we see in banks due to complications and bureaucracy. The regulation of exchange offices should be flexible, and the excuse of combating money laundering and terrorism financing should not be used to hinder the offices’ ability to operate effectively as before. I expect exchange offices to be required to submit numerous documents for every transaction, which will undoubtedly restrain their operations, making unlicensed offices the better option.

Third: There should be greater transparency from the Central Bank, clearly outlining all procedures, laws, and requirements that licensed exchange offices will operate under, as well as the benefits that a licensed office will receive. This will encourage other offices to apply for a license.”

He concluded by saying: “The main goal the Central Bank should focus on now is eliminating the gap between the official rate and the black market rate. This would reduce the demand from speculators who buy goods or apply for letters of credit not out of necessity for foreign currency, but simply to sell it at a higher price in the parallel market.

We also hope that the Central Bank strengthens its media role and fulfills the promises made by this administration, many of which have yet to be implemented.”

Exclusive: Abu Sriwil Comments on the Activation of Exchange Services in Libya – Motives and Effects on the Parallel Market and Exchange Rate

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International expert Yassin Abusriwil spoke exclusively to our source, stating:
In light of the economic challenges Libya faces, the Central Bank of Libya seeks to implement measures aimed at regulating the foreign exchange market and enhancing financial stability. Among these measures is the activation and regulation of exchange services—a decision that carries clear economic objectives but also raises questions about its impact on the parallel market, exchange rate, and the continued inflow of foreign currency in response to growing market demand.

He added:
In this article, we outline our perspective on the reasons behind this measure, analyze its potential effects, and focus on its implications for the Libyan economy.

First: Reasons Behind the Central Bank of Libya’s Decision

According to our analysis, the decision could be driven by the following factors:

1. Reducing Dependence on the Parallel Market

The parallel market remains the primary source of foreign currencies in Libya due to restrictions on purchasing foreign currency through official channels. This fosters speculation and creates a significant disparity between the official exchange rate and the black market rate, leading to sharp economic fluctuations. Activating exchange companies aims to provide official alternatives that reduce reliance on the parallel market.

2. Enhancing Transparency and Financial Oversight

By activating exchange services, the Central Bank of Libya seeks to strengthen oversight of foreign currency flows, which helps combat money laundering and the financing of illegal activities. This step also allows for the collection of accurate data on foreign currency demand, improving the effectiveness of monetary policies and aligning with international regulations.

3. Improving Banking Sector Efficiency

Libyan banks face liquidity issues and difficulties in executing international financial transactions, pushing individuals and businesses toward the parallel market. Activating exchange companies could ease pressure on banks, offering faster and more flexible alternatives for financial transfers and currency purchases.

4. Reducing Exchange Rate Volatility

Having official exchange channels enables the central bank to intervene more effectively in determining the exchange rate, narrowing the gap between the official rate and the parallel market, thus contributing to relative economic stability.

Second: Expected Effects and Outcomes of Activating Exchange Services

1. Organizing the Foreign Exchange Market

This decision is expected to bring greater regulation to the foreign exchange market, ensuring transactions follow clear, monitored procedures, thereby reducing risks of manipulation and speculation.

2. Strengthening Financial Stability

With official exchange services available, individuals and businesses can access foreign currency at more stable rates, limiting financial market disruptions and boosting confidence in the banking sector.

3. Improving the Business and Investment Environment

Making foreign currency available through official channels will facilitate imports and financial transfers, fostering a better business climate and enhancing the private sector’s ability to plan and invest effectively.

Third: Impact on the Parallel Market and Exchange Rate

1. Lower Demand for the Parallel Market

As foreign currency becomes available through official exchange companies, demand for the parallel market is expected to decline, especially if official rates are competitive and meet market needs.

2. Narrowing the Gap Between Official and Parallel Market Rates

With increased foreign currency supply through licensed exchange companies, the disparity between official and black market rates will shrink, reducing speculation and fostering relative exchange rate stability.

3. Possibility of a New Parallel Market Emerging

If foreign currency distribution mechanisms through exchange companies are not fair or sufficient to meet demand, a new parallel market may emerge, with individuals circumventing restrictions, potentially sustaining some speculative activities.

4. Impact on the Libyan Dinar’s Value

If exchange market regulation increases public confidence in official channels, the Libyan dinar may see slight appreciation against foreign currencies. However, if the new system fails to meet market demand, pressure on the exchange rate may persist.

The Continued Flow of Foreign Currency: Challenges and Solutions

Regarding the ongoing availability of foreign currency, Abu Sriwil stated that several key factors influence whether companies can access foreign currency, including:

  • Adequate Foreign Reserves: If the Central Bank of Libya cannot meet rising demand, sustained pressure could drive a return to reliance on the parallel market.
  • Monetary Policy Flexibility: Strict restrictions on foreign currency transactions may limit individuals’ and businesses’ ability to obtain hard currency through official channels.
  • Political and Security Stability: Political unrest can disrupt financial flows and foreign investments, reducing foreign currency availability in the official market.

The Role of Supply and Demand in Sustainability

  • If demand for foreign currency exceeds the new system’s capacity to supply it—an expected scenario given the lack of organized trade policies—the gap between supply and demand could weaken the measure’s effectiveness.
  • Conversely, if the central bank can regularly provide sufficient foreign currency at competitive rates, market stability may improve, reducing the parallel market’s role. Conducting market studies to determine real demand is crucial.

Proposed Solutions to Ensure Foreign Currency Availability

  • Increasing Foreign Reserves Through Oil Revenue Growth: Since oil revenues are Libya’s primary source of foreign currency, ensuring stable production and exports will help maintain a steady foreign exchange supply.
  • Broader Banking Reforms: Activating exchange companies should be accompanied by wider banking sector reforms, including easing restrictions on financial transfers and improving the foreign investment environment.
  • Enhancing Transparency and Oversight: To ensure success, strict oversight mechanisms must be implemented to prevent manipulation or unlawful exploitation of foreign currency distribution.

Final Thoughts

Abu Sriwil concluded:
Activating exchange services in Libya is a crucial step toward regulating the foreign exchange market and promoting financial stability. However, it is not a standalone solution to the economic issues related to the exchange rate and parallel market. The long-term success of this measure depends on the Central Bank of Libya’s ability to meet rising demand for foreign currency and the flexibility of monetary policies to adapt to economic changes. If implemented within a broader financial and banking reform strategy, this initiative could help curb speculation and contribute to greater economic stability.

Al-Zantouti: “The Government is Smuggling Its Own Oil”

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Financial expert Khaled Al-Zantouti has written an article addressing the increasing reports from international organizations regarding mismanagement, corruption, and the exploitation of public resources for personal and illegitimate gains by both official and unofficial entities.

The recently published UN Panel of Experts report, spanning around 300 pages with annexes, data, and charts, presents clear evidence of these issues, much like the latest Audit Bureau report. While some may question the Bureau’s impartiality, it is difficult to accuse an international body and global experts of bias. The report exposes systemic flaws, naming individuals involved, and provides a stark reflection of how political and economic affairs are being handled.

One key issue highlighted in the report is fuel smuggling. It points to the restructuring of the National Oil Corporation, resulting in the creation of the first private oil company authorized to export petroleum products—raising concerns that this restructuring may have facilitated smuggling operations. If privatization is truly the goal, it should be done transparently, allowing fair competition under market-driven conditions.

The report also details large-scale, systematic smuggling operations from government-controlled ports and state-owned companies, allegedly carried out by individuals with political or security influence. These operations, amounting to millions of tons of fuel and potentially billions of dollars, suggest that those in charge may be complicit—leading to the painful realization that the guardians may be the thieves.

Al-Zantouti urges immediate action: halt systematic fuel smuggling, launch judicial investigations, and hold those responsible accountable. He criticizes voices calling for subsidy removal or cash compensation while ignoring the urgent need to eliminate smuggling first. While he acknowledges the necessity of subsidy reforms, he insists that stopping fuel smuggling must come first. Only after securing national resources should Libya pursue economic reforms under a fair social safety net that ensures rightful distribution—whether through direct commodity subsidies or targeted cash assistance.

“Stop the smuggling first. Immediately.“

Al-Ghwil to Sada: Activating Exchange Services is a Key Step in Regulating the Currency Market

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Economic expert Mohammed Khaled Al-Ghwil told our source that activating exchange services is an important step in regulating the currency trading market.

He added, “We hope this will be the first in a series of interconnected executive measures within a well-thought-out monetary policy, forming part of a comprehensive package of sound economic policies aimed at restructuring and developing the economy.”

Al-Ghwil concluded by stating that while these effects may take some time to become visible and tangible, they are essential for long-term economic stability.

Exclusive: Saber Al-Wahsh Predicts Exchange Rate Drop Following Central Bank Board Meeting in Derna

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Economic expert Saber Al-Wahsh stated exclusively to our source that following the Central Bank of Libya’s board meeting in Derna, it is likely that the bank has received assurances to curb or unify spending. He added that a key indicator of this is the continued unrestricted sale of foreign currency, supported by the regular inflow of oil revenues.

Al-Wahsh further noted that this development suggests a potential decline in the parallel market exchange rate in the coming period. However, he also emphasized the importance of the Central Bank monitoring global political shifts, particularly Trump’s threats and their potential impact on oil prices.

Exclusive: Central Bank Grants Final Operating Licenses to 64 Exchange Companies and Offices

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Banking sources revealed exclusively to our source that the Central Bank of Libya has granted final operating licenses to 64 exchange companies and offices, allowing them to commence operations starting today.

The official announcements, including the names of the licensed companies and offices, will be published on the Central Bank of Libya’s website.

Exclusive: Central Bank to Sada – Monitoring Market Conditions and Expecting Dollar Decline

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The Central Bank of Libya revealed exclusively to our source that foreign currency sales for all purposes are proceeding smoothly, with the bank covering all demands received through the letters of credit and card systems.

The bank also expects the dollar exchange rate to drop below 6.35 LYD this week after reaching 6.40 LYD per dollar. The Central Bank remains committed to monitoring foreign exchange market conditions.

Commenting on the Activation of Exchange Services, Ghaith to Sada: “Does the Central Bank Have Sufficient Oversight to Prevent Money Laundering or Speculation?”

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Former board member of the Central Bank of Libya, Mrajaa Ghaith, spoke to our source regarding the activation of exchange services. He stated that the 2013 decision approved the establishment of exchange offices under the condition that they would not obtain foreign currency from the Central Bank. “If the Central Bank currently provides foreign currency in a monopolized manner, then where will exchange offices source their currency?” he questioned.

Ghaith also raised concerns about whether the same approach will continue with the so-called personal-use cards and whether the Central Bank has the necessary capacity to monitor these offices and ensure they do not engage in money laundering or speculative trading.