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Author: Amira Cherni

Exclusive: The Central Bank Issues Regulations to Facilitate Salary Disbursement Before Reaching Banks – Details Below

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Our source has obtained a circular issued by the Central Bank of Libya to commercial banks regarding regulations for setting purchase limits based on individual salaries. The goal is to facilitate salary disbursement before funds are deposited into banks and to promote electronic payments.

The regulations stipulate that banks must establish purchase limits through electronic payment services they offer, such as electronic cards or mobile applications.

The limit granted to customers is considered a form of Qard Hasan (interest-free loan) and is subject to all its rules, terms, and Sharia-compliant regulations. Key conditions include:

  • No commissions, whether fixed or percentage-based, are to be charged on the overdraft amount.
  • Customers must not be required to subscribe to additional services to receive the limit.

The service is to be offered upon customer request through bank-specific mobile applications, SMS services, or signed forms that outline all product terms and conditions, approved by the bank’s Sharia supervisory board.

Each bank is required to establish policies and regulations for the service, including identifying target beneficiaries, service terms, and the procedures needed to safeguard the rights of both the bank and its customers. Banks may impose conditions for eligibility, restrict usage cases, set specific loan ceilings, or link the limit to the salary value, provided these conditions do not conflict with the bank’s financial policies or legal regulations.

The service is available to bank customers with active current accounts who have been receiving regular salary deposits for at least six months.

The granted limit must not exceed 60% of the net salary after deducting any installments or obligations. The used amount is automatically deducted from the limit when the salary is deposited, and the limit is renewed automatically unless either party decides otherwise.

The bank’s board of directors and Sharia supervisory board must approve the policies, product guidelines, terms, and models, ensuring compliance with regulations issued by the Central Bank of Libya.

Banks are also authorized to take all necessary technical and legal measures to recover their dues in cases where customers fail to prove insolvency. Additionally, banks may refuse to provide a Qard Hasan to clients with a history of defaults or other issues, as determined by approved policies and regulations to mitigate risks.

In light of this, the Central Bank has urged commercial banks to launch the product and prepare their systems to enable the use of these limits for electronic payment transactions in compliance with the aforementioned terms and regulations.

From Tripoli to Benghazi: “Africa Intelligence” Reveals the Journey of the Turkish Oil Company BGN… Here Are the Details

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The French intelligence website Africa Intelligence reported on Monday that the Turkish oil company “BGN” has established itself as a major player in Libya’s oil sector. The Dubai-based company, led by “Roya Baycan,” has succeeded in acquiring the majority of crude oil in Libya.

The website further stated that the Turkish company has become one of the country’s primary fuel suppliers and is now looking to invest in Libyan infrastructure and oil fields, according to the report.

Commenting on the 2023 Audit Bureau Report: Al-Zentouti Critiques State Management and Fiscal Irregularities

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Financial expert Khaled Al-Zentouti penned an article in which he stated: “The 2023 Audit Bureau report spans 570 pages, each one deserving of a case, a prosecutor, a judge, a prison, prisoners, and a jailer.”

He highlighted that the report contains 19 chapters and 579 pages, mostly detailing negative aspects such as resource mismanagement, violations, and corruption. Al-Zentouti added that it barely includes any positive points, except for the Quranic verse:

“O you who have believed, fear Allah. And let every soul look to what it has put forth for tomorrow – and fear Allah. Indeed, Allah is Acquainted with what you do.”
(Al-Hashr: 18)

This verse, according to him, seems like a subtle message from the bureau, as if saying: “Leave judgment to the Creator, as punishment in this world appears unattainable.”

Key Highlights from the Report

Al-Zentouti provided a financial and technical overview of the main points in the report:

  1. Public Spending vs. Revenues:
    • Total public spending reached 174 billion LYD, while sovereign revenues were 175 billion LYD, indicating a positive balance (if the figures are accurate).
  2. Decline in Oil Revenues:
    • Oil revenues in 2023 dropped by 10 billion LYD (6%) compared to 2022, despite higher average daily production and crude oil prices.
  3. Development Expenditures:
    • Allocations for development totaled only 24 billion LYD (13.8% of total spending), marking a 28% decrease from the previous year. This is far below global standards, where development spending often constitutes 60%-70% of total expenditures.
  4. Wage Increases:
    • Salaries rose by 22%, reaching 62 billion LYD, representing 36% of total spending. Al-Zentouti labeled this as a wealth distribution against limited productivity.
  5. Subsidies:
    • Subsidies increased by 9% to 68 billion LYD, about 40% of total spending. A significant portion is smuggled abroad, including fuel sold in neighboring European countries at subsidized rates.
  6. Oil Barter System:
    • Bartered oil transactions totaled 41.2 billion LYD, with no documentation at the Ministry of Finance or transparency regarding pricing mechanisms or procedures.
  7. Public Debt:
    • The central bank reported public debt at 84 billion LYD, excluding debt figures from the eastern region, highlighting the disjointed state of Libya’s financial system.
  8. Telecom Revenues:
    • Revenue from telecommunications amounted to only 506 million LYD (0.25% of total revenue), far below international benchmarks of 4%-8% of GDP.
  9. Customs and Taxes:
    • Customs and taxes contributed a mere 1.6% of total revenue, reflecting the pervasive impact of corruption.
  10. Central Bank Violations:
    • The report pointed to violations at the Central Bank and within the banking sector, undermining the core of Libya’s financial system.
  11. Final Accounts:
    • The state’s final accounts have not been closed for over 16 years, which Al-Zentouti described as evidence of dysfunction, comparing Libya to a “herd being led to the slaughterhouse.”
  12. Audit Bureau Members Harassed:
    • Instances of officials attacking and expelling Audit Bureau members reflect the pervasive corruption and poor governance.

A Call for Accountability

Al-Zentouti stressed that the report reflects a dire need for judicial oversight and extensive reforms. He remarked: “This report requires hundreds of prosecutors, judges, and correctional facilities to address violations across the legislative, executive, and municipal levels.”

He concluded by noting the release of a separate report by the Audit Bureau in Al-Bayda to the Speaker of the House of Representatives on July 30, 2024, and hinted that “what lies hidden may be even greater.”

Spanish Consul in Libya Speaks Reveals Resuming Spanish Airlines and Visa Details for Libyan Citizens

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The Spanish Consul in Libya, Juan Torres, told our source today, Thursday, that “Regarding the resumption of Spanish Airlines, we currently have no information about the airline returning to operate in the capital, Tripoli.”

The consul assured our source that “There is no difficulty for Libyan citizens in obtaining a Spanish visa as long as all required documents are submitted.”

Exclusive: Oil Source Responds on the Oil-for-Fuel Swap Conducted by the NOC

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An oil source, who preferred to remain anonymous, told our source: “What is taking place is a settlement process in exchange for fuel supplies. This mechanism has been in place for nearly two years before the current management board of the corporation took office and was approved by a Cabinet decision. The current board, which inherited this mechanism, has officially communicated multiple times with the Cabinet, requesting a clear budget or financial allocation to purchase fuel and end the swap mechanism.”

The source added: “The swap process involves a settlement account for the value of fuel with entities to which the Oil Corporation exports crude oil, and which are capable of supplying the fuel required by the Libyan state. The settlement account is monitored by the Audit Bureau, the review department within the Oil Corporation, and an international firm that examines the account and provides regular periodic certificates on any violations.”

He continued: “The National Oil Corporation is legally tasked with processes related to fuel provision and crude oil export. However, from my expertise in the fields of oil, gas, and economics, I believe that under the current political circumstances, it is challenging to transition from commodity subsidies to cash subsidies. The simplest prerequisite for cash subsidies is strictness and fair implementation through supervision and monitoring mechanisms nationwide. I think this is difficult to achieve at present!

Exclusive: Central Bank Sends 15 Million LYD to Kufra – Allocation Details

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The Central Bank of Libya revealed in an exclusive statement to our source that it has dispatched 15 million LYD in cash to the southeastern city of Kufra.

The allocation includes 7 million LYD designated for branches of Wahda Bank, 4 million LYD for the safes of North Africa Bank branches, and 4 million LYD for Jumhouria Bank.

This transfer was made under the directives of Central Bank Governor Naji Issa and his deputy. The shipment has just departed from Tripoli.

Exclusive: Al-Harati Comments on Government’s Return to Salary Increase Chaos

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Legal advisor Hisham Al-Harati exclusively told our source: “Any increase in the salaries of state employees must be carried out in accordance with economic and legal controls that ensure financial balance for the state.”

He added: “Raising salaries without a corresponding increase in public revenues poses a direct threat to financial stability and could lead to a general budget deficit, putting the state at risk of bankruptcy.”

According to relevant general legal principles, any adjustment to the salary structure must take into account:

  • Balancing revenues and expenditures: ensuring sustainable financial resources to cover any proposed increases.
  • Preserving national economic stability: avoiding negative impacts on the value of the local currency or heightened inflation rates.
  • Conducting prior financial feasibility studies: demonstrating the impact of the increase on the general budget in both the short and long term.

He concluded: “Therefore, we urge legislative and executive authorities to make responsible and well-studied decisions that strike a balance between improving citizens’ living conditions and maintaining the state’s financial stability.”

Nova Agency: Foundational Meeting Between Simest Italy and the Libyan Foreign Bank in Rome – Details Revealed

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A foundational meeting took place today, Tuesday, in Rome between the senior management of Simest, a company affiliated with the Italian Deposit and Loans Fund that focuses on fostering international growth for Italian companies, and the Libyan Foreign Bank, an institution fully controlled by the Central Bank of Libya, with revenue from the sale of hydrocarbon materials.

According to Nova Agency, this event represents a follow-up to the agreement signed last October in Tripoli during the Italian-Libyan Business Forum, which aims to lay the foundations for strengthening trade relations between Italy and Libya.

The agency reported that the main goal is to stimulate a significant increase in bilateral investments and support the competitiveness of companies through technology transfer. The agreement also includes expanding Simest’s African initiatives to include Libya, a financial instrument worth 200 million euros outlined in the Matti Plan, which aims to encourage the development of trade relations between Italy and Africa.

Exclusive: Central Bank Sends 10 Million Dinars to Ubari

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The Central Bank of Libya exclusively revealed to our source that a plane carrying a cash shipment of 10 million dinars took off moments ago from Tripoli Airport heading to Ubari in southern Libya.

Of this total, 4 million dinars are allocated to the National Commercial Bank, 3 million dinars to the safes of the North Africa Bank branches, and 3 million dinars to the Republic Bank.

Energy Capital Power: Libya and Qatar Explore Cooperation in Gas and Renewable Energy Sectors

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The Energy Capital Power website reported today, Tuesday, that Libya, which holds approximately 52 trillion cubic feet of natural gas reserves, is aiming to capitalize on these resources, targeting the production of 4 billion cubic feet of gas per day over the next three to five years with the support of new exploration initiatives.

According to the website, Sirte Oil Company announced a significant gas discovery southeast of the Al-Lahiq field, with the potential to produce approximately 16.8 million cubic feet per day. Libya is also working on developing major gas projects to enhance both domestic consumption and export capacities, including the A&E structures project led by Mellitah Oil and Gas, a joint venture between Italy’s Eni and the National Oil Corporation, which aims to produce 750 million cubic feet per day by 2026.

The site also mentioned that Qatar, being one of the largest producers of liquefied natural gas (LNG) in the world and representing 20% of global supplies, brings extensive expertise to the gas industry. By leveraging Qatari expertise, Libya could adopt the best practices in gas extraction, processing, and export efficiently, thereby enhancing the overall capacity of the sector. Qatar’s substantial investments in oil and gas technology could also provide technical support and consulting services to the National Oil Corporation, including the implementation of advanced digital tools and the deployment of sophisticated monitoring systems.

Collaborative Investments in Renewable Energy:

The site highlighted that both countries are committed to diversifying their energy portfolios and reducing dependence on fossil fuels. Qatar’s national renewable energy strategy aims to generate 4 gigawatts of photovoltaic solar power, increasing the share of renewable energy in the energy mix from 5% to 18% by 2030, alongside the development of 200 megawatts of additional diversified solar power systems.

The website further noted that under its renewable energy strategic plan, Libya aims to achieve a 10% share from renewable energy sources in its energy mix by 2025 and 30% by 2030. The General Electricity Company of Libya is currently developing the Sadda photovoltaic solar power station with a capacity of 500 megawatts in partnership with Total Energies, set to become the country’s largest solar project, utilizing advanced technology and up to 1.2 million solar panels.

With a goal of 4 gigawatts of renewable energy by 2035, Libya presents attractive opportunities and strong government support for cooperation with Qatar. The recent meeting opened the door for large-scale renewable energy initiatives, and enhanced collaboration with Qatar could facilitate knowledge exchange, financial support, and technology transfer, contributing to economic stability and reducing exposure to global oil price fluctuations.

The site confirmed that the Libya Energy and Economy Summit will be held in Tripoli on January 18-19, 2025, gathering industry leaders, investors, and policymakers to foster dialogue, secure investments, and support the growth of Libya’s energy and infrastructure sectors.

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Exclusive: Central Bank Sends 10 Million to Commercial Banks in Ghat

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The Central Bank of Libya exclusively revealed to our source that a plane carrying a cash shipment of 10 million dinars took off moments ago from Tripoli Airport heading to Ghat.

Of the total amount, 6 million dinars are allocated to the National Commercial Bank, and 4 million dinars to the safes of the North Africa Bank branches. The Central Bank will continue to distribute cash in the coming days and weeks according to a well-organized plan with scheduled flights.

This comes after assessing the cash needs of customers at commercial bank branches. Following the directives of Governor Nagy Issa, the Central Bank of Libya has started distributing cash shipments to replenish bank branches across Libya.

Oil Minister Mohamed Aoun Responds to His Dismissal by the Government of National Unity

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In an exclusive statement, Libya’s Minister of Oil and Gas, Mohamed Aoun, rejected the decision to relieve him of his duties issued by the Government of National Unity (GNU). He declared the move as null and void, asserting that the Prime Minister does not possess the authority to dismiss a minister. According to Aoun, this responsibility lies solely with the House of Representatives, which originally approved the formation of the government.

Legal Standpoint

Minister Aoun emphasized that the matter is already under review by the Supreme Court, at the request of the Prime Minister himself. He expressed dismay over the lack of formal communication about the decision, stating, “I was neither verbally nor officially informed of this measure, which appears to have been deliberately leaked to the media. This demonstrates the extent of disregard for proper administrative procedures.”

Accusations of Misconduct and Retaliation

Aoun criticized the Prime Minister’s decision, describing it as a personal vendetta and an abuse of power. He questioned why the Prime Minister did not take similar actions against other ministers who left the government after its formation, insinuating that his dismissal was a targeted act. “The decision to remove me serves only to prolong the lifespan of this government,” Oun remarked, further accusing the Prime Minister of exploiting his authority to settle personal scores.

Commitment to Libya’s Interests

Defending his tenure, Aoun stated that his dismissal was not due to incompetence or any allegations of corruption. “My sole commitment has been to safeguard the nation’s wealth and manage it with integrity, transparency, and adherence to the laws and regulations of the Libyan state,” he affirmed. He attributed the decision to his unwavering dedication to the country’s best interests.

A Pledge to Continue the Path of Integrity

Aoun concluded by expressing his determination to continue serving Libya, regardless of his current position. “With God’s will, I will persist on this righteous path, whether in my current role or any other capacity. Losing this position will not deter me, as my priority remains the welfare of the nation.”

Exclusive: Al-Jabo Comments on Salaries, Urges the Central Bank to Transfer Wages to Beneficiaries’ Accounts

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Economic advisor Wahid Al-Jabo, in an exclusive statement to Sada Economic, said: “If the Ministry of Finance has prepared and directed the salaries on time with lists of state employees’ names, the Central Bank of Libya must transfer the salaries to the beneficiaries’ current bank accounts.”

He added, “However, if the allocations for Chapter One [salaries] have been exhausted, the Ministry of Finance should seek permission from the Central Bank to cover the salaries.”

Al-Jabo also noted that the halting of oil production and export in recent months might have had a negative impact on the Central Bank’s financial inflows, leading to salary delays. He emphasized the importance of clarifying the reasons for the salary delays between the Ministry of Finance and the Central Bank of Libya.

Exclusive: Central Bank to Sada: No Revenues Received for Months, October Salaries Funded by a Loan from Us

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The Central Bank of Libya exclusively informed Sada Economic about recent developments regarding salary disbursements.

It revealed that no revenues have been transferred to the bank for months as of today, November 25, to cover salaries. As evidence, the Central Bank financed October’s salaries through a loan from its own resources.

Abu Snina: “No Stability for the Libyan Dinar Exchange Rate Without Oil Revenues”

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The economic expert, Mohamed Abu Snina, wrote an article stating:

In Brief, the focus of Libyan decision-makers, those shaping the current landscape and challenging authority, remains limited to finding short-term solutions to economic problems such as the exchange rate, public spending, liquidity, fuel subsidies, salaries, and oil production. These areas suffer from recurring distortions that merely reflect symptoms of the deeper issue plaguing the economy: the heavy reliance on crude oil export revenues, a rentier culture, and the resulting deadlock. This perpetuates a vicious cycle of dependency, sustaining a mono-economy with no clear vision for reform.

The salary bill inflates public expenditure, leading to exchange rate instability. Exchange rate instability puts pressure on reserves, which in turn restricts foreign currency use. This limitation reduces liquidity, increases the black-market exchange rate, and subsequently leads to a liquidity crisis. The public’s lack of trust in the banking sector worsens, increasing reliance on public expenditure. Allocating funds to develop the oil sector comes at the expense of other development projects. Thus, addressing any existing economic problem or distortion often exacerbates another, because the root cause is structural. There is no public spending or budget funding without oil revenues.

There can be no stability for the Libyan dinar exchange rate without oil revenues. No letters of credit for importing goods, supplies, and services can be issued without oil revenues. Salaries for approximately 2.8 million Libyans depend on oil revenues, as do fuel supplies for electricity and transportation. Fuel subsidies, which already strain the state’s budget, also rely on oil revenues. Even the development of the oil sector itself is unattainable without these revenues.

Decision-makers ignore the fact that oil is an exhaustible resource that may deplete within less than 25 years—a brief period in the lifespan of a state. Additionally, oil is losing market share to clean and alternative energy sources in the medium term, a reality given little attention. Oil prices are on a downward trend, and the exploitation of oil revenues fails to consider the rights of future generations, regional development needs, or the global climate crisis.

Why have successive governments failed to create and implement a serious strategy for economic diversification? Instead, they merely extinguish recurring crises. The Libyan Sovereign Wealth Fund, valued at over $60 billion, has yet to contribute to financing the state’s budget deficit, contrary to its foundational goals. Meanwhile, Libya’s other natural resources remain unutilized and ignored due to the prevailing conditions. Exploiting these resources requires investing oil revenues strategically, but those revenues are barely sufficient to cover salary bills.

There is no choice, priority, or alternative—before it is too late—to save Libya’s economy, the state’s future, and the coming generations other than by diversifying income sources, restructuring the national economy, halting the expansion of consumer spending and subsidies, breaking oil’s dominance over the economy, and reforming institutions while combating corruption—all within a defined timeframe.