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Author: Amira Cherni

Oil Price: Spanish Companies Make Significant Oil Discovery in These Cities in Libya… Here Are the Details

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The oil-focused website Oil Price reported on Thursday that the Spanish company Repsol YPF has made a “significant” oil discovery in the country, marking its sixth discovery in the Murzuq Basin.

According to the website, the discovery, which produced a flow of 4,650 barrels per day of “high-quality oil” during testing, comes just weeks after a group of international operators competed for exploration rights in the second auction under the terms of the Exploration and Production Sharing Agreement.

The website noted that the first round of discoveries, which took place in January 2005, was considered a success, with 23 out of 26 contract areas primarily awarded to Asian and European companies. This success, particularly in the NC186 area—a field spanning 4,300 square kilometers located 800 kilometers south—highlighted the potential for large-scale production in the region.

Exclusive: Audit Bureau Alerts Tax Authority to Withhold Registration of Contracts Worth 5 Million Dinars or More Without Bureau Approval

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Sada Economic newspaper’s source has exclusively obtained a notice from Attiyat Allah Hussein Abdul Karim, Deputy of the Libyan Audit Bureau, addressed to the head of the Tax Authority. The notice instructs the Tax Authority not to complete the registration and certification of any public contracts valued at 5 million Libyan dinars or more unless accompanied by proof of the Audit Bureau’s approval.

He stated that, according to the ruling of the Administrative Chamber of the Supreme Court on January 17, 2024, which deemed Law No. 2 of 2023 unconstitutional (this law had added provisions to Law No. 20 of 2013 on the establishment of the Administrative Oversight Authority), the Audit Bureau is the sole constitutional institution responsible for overseeing all revenues and expenditures through comprehensive financial oversight, including prior review of contracts and other financial transactions.

The Deputy emphasized that the Bureau’s authority includes pre- and post-transaction audits and concurrent oversight, a constitutional responsibility that excludes other entities from performing similar tasks.

He underscored the importance of respecting judicial rulings and adhering to the provisions of Law No. 19 of 2013 concerning the reorganization of the Audit Bureau and its amendments.

He further reminded the head of the Tax Authority to ensure that any contracts submitted for certification meet the requirement of indicating full tax payment as stipulated by law, with the stipulation that contracts are not to be split in a way that reduces their value below the threshold for Bureau oversight.

Exclusive: After Review and Examination, Audit Bureau Decides Not to Withhold the Wife and Children’s Grant

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Sada Economic newspaper’s source has exclusively obtained a communication from the Audit Bureau to the Director of the Wife and Children’s Grant Department at the Ministry of Social Affairs in the Government of National Unity.

The communication indicated that, following the Audit Bureau’s review and examinations, it has decided not to withhold the continuation of the grant disbursement procedures. However, several actions are required, including the exclusion of deceased cases according to the official records from the Civil Status Authority, removal of these cases from the children’s grant database at the Wife and Children’s Grant Department, and correction of bank account numbers based on the digits specified by each commercial bank.

Al-Shhibi: “Clearing Between Central Bank Branches in Tripoli and Benghazi Exceeds the Board’s Authority – Here’s Why”

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Banking expert Dr. Houssem Al-Shhibi commented on his official Facebook page regarding the decision of the Central Bank of Libya’s Board of Directors to activate a unified clearing system between its Tripoli and Benghazi branches.

He stated that this decision, made at the Board’s first meeting, is a positive indicator of the Board’s intent to repair damage caused by political divisions over the past decade. However, he noted several points:

“First: This decision has been repeatedly announced on various occasions, most notably following the formation of the Government of National Unity and a meeting between Mr. Al-Hibri and Mr. Al-Kabeer, but it has not yet been implemented.

Second: Benghazi has two systems within the Central Bank. The first is the original system housed at the branch on Agency Street, separated from the main system by Mr. Al-Kabeer in 2014 for political reasons. While this system can be reactivated, it only reflects the bank’s accounts as they were in 2014.

The second system was created after the division and operates independently of Tripoli’s system, accurately reflecting Benghazi’s Central Bank budget, including bank balances.

Third: Merging the two systems, or in accounting terms, consolidating the two banks’ budgets, faces technical issues due to differences between Benghazi’s and Tripoli’s general ledger and accounting systems.

Additionally: While it may seem like a simple banking measure, achieving clearing unification actually exceeds the Central Bank’s authority. For effective clearing, bank balances must be transferred from Benghazi’s budget to Tripoli’s, which would require shifting corresponding debt items into Tripoli’s budget. The issue is that the banks’ balances at Benghazi’s branch are offset by a public debt exceeding 90 billion dinars. This consolidation requires political willingness from both sides of the political divide to unify and legitimize this debt as a single Libyan public debt.”

He added: “Historically, I was assigned after the Geneva Agreement and the establishment of the Government of National Unity to follow up on this matter, but I found no political will to take this step. I believe this decision goes beyond the capabilities and mandate of the Central Bank’s Board of Directors. I hope the political decision-makers, especially the House of Representatives and the State Council, assume their responsibilities to allow the Board to fulfill its duties and deliver the long-awaited results to citizens.”

Exclusive: CEO of Strategic Partnership Forum for Oil and Gas Reveals National Oil Corporation’s Plan for Forum with Private Sector

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Houssem Misbah, CEO of the Strategic Partnership Forum for Oil and Gas, revealed to Sada Economic newspaper’s source that the National Oil Corporation plans to hold a forum bringing together the NOC, its affiliated national companies, and Libyan private sector companies operating in the oil and gas sector.

Misbah added that through this forum, the NOC aims to establish a new strategy to organize its partnerships with Libyan private sector companies in oil and gas, addressing the challenges facing these companies and exploring solutions. The forum will also feature discussion sessions to present and debate methods for achieving sustainable development in the oil sector and mechanisms for boosting production.

He noted that the organizers of the forum are keen to highlight the role of Libyan private sector companies and their potential to contribute to the growth and development of the oil and gas sector.

Exclusive: Al-Shhumi Comments on Central Bank Board’s Decisions, Says Priorities Should Include Reevaluating the Exchange Rate

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Economic expert Suleiman Al-Shhumi spoke exclusively to Sada Economic newspaper, commenting on the recent decisions made by the Board of the Central Bank of Libya during its first meeting, part of a short-term plan aimed at providing a positive boost to the Libyan community and the financial and economic sectors. However, he expressed concerns that the Board’s decisions might have set expectations too high, suggesting they should have been more precise, especially regarding the opening of interbank clearing between the east and west.

He explained that the decision to open interbank clearing requires more than a decree from the Central Bank; it demands genuine intent, with clear, positive steps announced for opening it. This is particularly important because clearing is linked to settling the accumulated public debt held in the Central Bank’s branch in Benghazi. Such a settlement requires a political decision (a legislative decision by both councils) and the Bank’s actual ability to implement it on the ground by carrying out the settlement and opening clearing comprehensively, rather than through the temporary balance transfers previously attempted.

Al-Shhumi added that, in the past, the Central Bank claimed it had opened clearing, but existing issues created obstacles to a full and comprehensive clearing process. The Bank also made optimistic promises for the future, such as implementing lease financing under the 2010 law, though this law may need significant amendments to enable the proper establishment of lease financing companies, along with time to organize it effectively.

He further noted that opening the currency exchanges requires exchange rate stability and an adequate supply of foreign currency, among other conditions that may not be immediately achievable. On investment and deposit usage, he suggested the Board should prioritize applying the law that reinstated traditional interest, passed in 2023, and questioned why this law has not been implemented.

Al-Shuhumi argued that the Central Bank should focus on its core role in managing the exchange rate. He highlighted that the Bank’s statement did not indicate any plans to reassess the exchange rate, nor did it address the tax on foreign currency sales despite court rulings calling for its repeal. While the recent decisions convey a positive and necessary message, he believes some will be difficult to implement. Moreover, the statement ignored key issues central to the Bank’s role, such as exchange rate management, transparency, and how the Bank intends to address the presence of two governments in the country.

Norwegian Ambassador to Libya Discusses Embassy Affairs with Sada: Details Revealed

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Norwegian Ambassador to Libya, Hilde Klemetsdal, spoke to our source on Sunday, stating: “We have no plans to open the Norwegian Embassy in Tripoli, but we do wish to open a consulate.”

The Ambassador confirmed that the issue of the Norwegian consulate was one of the key topics she discussed during her recent visit to Tripoli, not the embassy.

Exclusive: Our Source Confirms Central Bank to Take Urgent Measures for Salary Payments by End of Week

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Our source has confirmed that the Central Bank’s Board of Directors and its Governor will take urgent measures to ensure salary payments are made by the end of the week.

This will be done in coordination with the Ministry of Finance, reassuring Libyans that salaries are a top priority in public spending.

Exclusive: Wali Writes: “For Sustainable Economic Stability and a Constant, Fixed Exchange Rate”

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Economist Ibrahim Wali has written an article exclusively for Sada Economic Newspaper, where he shared his insights:

“To date, the Central Bank of Libya has made commendable progress that is well-received by citizens and the Libyan monetary market. However, these steps are temporary unless they are accompanied by a missing fiscal policy and a dormant commercial policy, notably the Ministry of Economy. One hand cannot clap; the Central Bank cannot last for more than six months to a year without the cooperation of the Ministry of Finance and the Ministry of Economy, which is currently ineffective. Economic policy is formulated at the national level, and it requires the coordination of the three key policies: monetary, fiscal, and commercial.

Sustainable economic stability means a continuously fixed exchange rate, financial stability free from parallel spending and waste of public funds, and a commercial stability reflected in reduced prices for basic goods, medicine, and the necessities of life for the ordinary citizen. This is the responsibility of the Ministry of Economy, which is currently dormant. To date, we have not seen or heard of a meeting that gathers the representatives of the three policies— the Governor of the Central Bank of Libya, the Minister of Finance, and the Minister of Economy— to discuss the intertwined policies. They are each working independently.

It is evident that the Ministries of Finance and Economy are not concerned with fluctuations in the exchange rate. They leave it to the Central Bank to perform a miracle by handling the exchange rate and providing hard currency, which, in turn, depends solely on oil sales. If oil ports are closed or if oil prices fall below $72 per barrel, the Ministry of Finance will be unable to pay salaries.

Reform begins with fiscal policy first, before monetary policy, because fiscal policy controls revenue collection and expenditure. If expenditure contradicts or conflicts with monetary policy, it will certainly undermine it. Here, the blame falls on the Central Bank, which is criticized for failing in its monetary policy, but the real issue lies in the fiscal and commercial policies that have not aligned with the monetary policy.

Therefore, it is premature to judge the measures taken by the Central Bank. They represent a step in the right direction, but they are temporary and will not last beyond six months to a year unless fiscal and commercial policies align. Otherwise, the Central Bank will be unable to maintain a stable exchange rate and will struggle to provide hard currency for the two competing governments—one in the east and one in the west—due to parallel spending. The concern with these measures is that they were implemented all at once, which could succeed but is questionable, given the aforementioned risks. They could also fail, leading to worse consequences.

As for this year, I, along with some colleagues in the banking sector, believe the Central Bank should have delayed certain measures until a meeting with its board of directors could formulate a strategy for monetary policy. This meeting should include the Ministries of Finance and Economy to establish a unified national strategy for monetary, fiscal, and commercial policies aimed at ensuring exchange rate stability, controlling parallel spending, consolidating a unified budget for both governments, and addressing food and medicine prices to improve the living conditions of the Libyan people. This approach is essential to avoid a scenario where monetary policy remains stable temporarily, but a year later, things could take a turn for the worse, God forbid.”

Exclusive: Parliamentary Sources: No Current Signs of a 5% Tax Reduction Amidst Calls for Clarification on Its Purpose with the Pending Cancellation at Year-End

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Parliamentary sources have revealed to Sada Economic Newspaper that the proposal from the Central Bank of Libya to reduce the 5% foreign currency tax has not been approved. The proposal, which is part of a broader study, also included a plan to eliminate the tax by the end of this year. However, there are currently no indications of the tax being reduced to 15%, as suggested by the governor and his deputy.

The source added that the Speaker of the House of Representatives has requested clarification on the reasons behind the proposed reduction and its potential consequences, especially since the proposal coincides with the scheduled cancellation of the tax, as stipulated in a decision by the Speaker of the House. The decision, issued earlier, calls for the elimination of the tax by December 31, 2024.

Exclusive: Wali Writes: “Toward a Sustainable Economy and Stable Exchange Rate”

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The economic expert, Ibrahim Wali, penned an article exclusively for our source, stating:

“To date, the Central Bank of Libya (CBL) has taken commendable steps appreciated by citizens and the Libyan monetary market. However, these steps are temporary unless accompanied by the missing fiscal policy and the dormant trade policy under the Ministry of Economy. One hand cannot clap alone, and the CBL cannot sustain these measures for more than six months to a year without cooperation from the Ministry of Finance and the failed Ministry of Economy. Economic policy is not crafted by one entity but requires the synchronization of three pillars: monetary, fiscal, and trade policies.

Economic Stability Requires Coordination
Sustainable economic stability hinges on maintaining a continuous and stable exchange rate, fiscal stability free of parallel expenditures and public fund mismanagement, and trade stability represented by lower prices for essential goods such as food and medicine. This responsibility falls on the “sleeping” Ministry of Economy. To date, there has been no meeting uniting the heads of the three policy pillars—CBL Governor, Minister of Finance, and Minister of Economy—at a single table to address these issues collectively. Instead, each operates in isolation.

It is evident that the Ministries of Finance and Economy show little concern for fluctuations in the exchange rate, leaving the CBL to perform miracles to stabilize it and secure foreign currency—largely dependent on oil revenues. If oil ports are shut down or international oil prices drop below $72 per barrel, the Ministry of Finance will struggle to pay salaries.

Fiscal Policy: The Starting Point for Reform
Reform must begin with fiscal policy, as it governs revenue collection and expenditure. When spending conflicts with monetary policy, it inevitably undermines monetary stability. Consequently, criticisms of the CBL’s monetary policy failures are misplaced; the root cause lies in unaligned fiscal and trade policies.

Temporary Measures with Uncertain Outcomes
While the CBL’s recent measures are a step in the right direction, they remain temporary—likely effective for six months to a year unless fiscal and trade policies align. Without this coordination, the CBL will be unable to maintain exchange rate stability or supply foreign currency to two competing governments—one in the East and another in the West—amid parallel expenditures.

The decision to implement these measures all at once is a point of concern. While it may succeed, the risks are significant, and failure could result in worse outcomes than before.

A Call for Comprehensive Strategy
Many experts, myself included, believe the CBL should have waited to implement its measures until its Board of Directors convened to outline a cohesive monetary strategy. This should have been followed by collaborative meetings with the Ministries of Finance and Economy to develop a comprehensive strategy for Libya’s economic policies. Such coordination is essential for achieving sustainable exchange rate stability, addressing parallel expenditures, unifying the national budget, and tackling the rising costs of essential goods and services.

Without this broader strategy, the current measures offer only short-term relief. If no action is taken within the next year, the situation risks deteriorating to levels worse than before—God forbid.”

New Details Regarding the Sale of the French Partner’s Share in Sahara Bank to Local Companies

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A private source, in a statement to Sada Economic Newspaper, expressed surprise over the refusal to sell the French partner’s share in Sahara Bank to two local companies, despite their right to own 19%.

The source denied referring to the transaction as a theft, emphasizing that it was a legitimate sale between the French partner and the two companies, contrary to what has been circulated on some social media pages.

The source explained that this issue dates back to 2011, following the suspension of the French company’s activities. The partner had offered its share for sale on the stock market, and the two companies purchased it. The source confirmed that no legal action has been taken regarding the matter, indicating that there were no issues with the transaction, except for some delays caused by certain parties.

Furthermore, the source confirmed that all relevant authorities were notified about the sale process as early as July, and no objections were raised at the time.

New Details Regarding the Sale of the French Partner’s Share in Sahara Bank to Local Companies

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A private source expressed surprise in a statement to Sada Economic over the rejection of the sale of the French partner’s share in Sahara Bank to two local companies, despite their right to a 19% contribution.

The source also rejected labeling the transaction as theft, emphasizing that it is a sale and purchase agreement between the French partner and the two companies, contrary to what is being circulated on various platforms.

The source clarified that this matter dates back to 2011, following the freezing of the French company’s activities. The partner subsequently offered its share for sale on the stock exchange, and it was purchased by the two companies. They confirmed that no legal case has been filed in this regard, further proving there are no irregularities in the transaction except for obstructions by certain parties.

The source also noted that all relevant authorities were informed about the sale process last July, and no objections were raised regarding the sale.