Economic expert Ezzedine Ashour told our source about the economic situation in 2025, stating that Libya’s economy witnessed a relative improvement in its overall performance during 2025, mainly driven by the stability of oil production and higher public revenues. This contributed to strengthening growth indicators and short-term financial stability. However, this improvement remains limited in sustainability due to the persistence of structural imbalances and the economy’s near-total reliance on the oil sector.
He added that real GDP recorded a high growth rate compared to previous years, primarily attributed to improved oil production and exports. In contrast, growth in non-oil sectors remained weak, reflecting the fragility of the national production base and the limited role of the private sector.
He also noted that, on the public finance front, oil revenues helped cover most government expenditures, particularly salaries and subsidies, which eased short-term fiscal pressures. Nevertheless, current spending continued to dominate the budget structure, amid limited development spending and the absence of an effective medium-term public financial management framework.
Ashour further explained that in terms of monetary policy and the exchange rate, the Central Bank of Libya continued its efforts to maintain monetary stability and reduce exchange rate volatility. Despite achieving a degree of nominal stability, inflationary pressures persisted due to the expansion of public spending and increased reliance on imports to meet domestic demand.
Regarding the labor market and the private sector, Ashour said that challenges remain, most notably the dominance of the public sector, weak productive employment opportunities, and an unfavorable business environment for investment, which has limited the economy’s ability to generate inclusive and sustainable growth.
He concluded by saying that 2025 represents a phase of oil-driven economic recovery rather than a genuine structural transformation. Achieving economic sustainability remains contingent on accelerating reforms, diversifying the economy, improving governance, and enhancing coordination of macroeconomic policies.
