In an important statement published on its page, the Central Bank of Libya revealed that foreign exchange sales executed between March 1 and March 17, 2025, amounted to approximately $1.1 billion for personal purposes and $1.2 billion for documentary credits, bringing total sales to $2.3 billion. Meanwhile, oil revenues deposited into the Central Bank during the same period amounted to only $778.0 million. The bank emphasized that it is facing significant challenges due to declining public revenues caused by reduced oil revenues and delays in their collection, which increase pressure on foreign reserves. Additionally, the continued rise in dual government spending increases demand for foreign currency, threatening financial sustainability and posing challenges to the bank’s efforts to maintain economic stability.
Our banking source revealed that, apart from the decline in revenues flowing into the Central Bank, another issue is the rising demand for foreign exchange. This is due to pressure on the foreign exchange sale system, as individuals log in from multiple devices simultaneously under one identity, enabling reservations worth millions within a short period. This negatively affects the system’s performance and the reservation process.
The head of the Accounting Department at the Libyan Academy, Dr. Abu Bakr Abu Al-Qasim, commented to our source, saying: “Do not leave the Central Bank alone.” He added that the weekly and monthly reports of the Central Bank serve as warning messages to all Libyans. It is as if the bank is telling us: The Central Bank is still standing alone against reckless governments with inflated and uncontrolled spending and against the National Oil Corporation, which operates unchecked, controlling oil revenue flows without oversight or accountability, in clear violation of the laws and regulations governing the state’s public finances.
He continued: It is also fighting against speculators leading this war against the dinar. Today, it is necessary for everyone, without exception—whether elite or ordinary citizens—to stand firmly with the Central Bank of Libya’s management in its battle to defend the strength of the struggling dinar.
Former member of the Central Bank’s Exchange Rate Committee, Musbah Al-Akari, stated on his official Facebook page: Since the arrival of the new administration at the Central Bank, it has been making great efforts to restore some strength to the Libyan dinar against foreign currencies. Despite some victories, it has found itself in a real battle alone, without support—even from the citizens themselves.
He added: The Central Bank found itself between two governments, each claiming sole legitimacy and authority over expenditures. One government spends here, the other spends there, and everyone knows that increased spending means injecting new money into the market, leading to increased demand for foreign currencies.
Al-Akari further explained: Despite the Central Bank spending $7 billion—equivalent to 40 billion Libyan dinars—in three months, the exchange rate continues to rise.
He pointed out another issue: Citizens rushing to banks with cash to request personal-purpose cards, which they then use for activities other than what the Central Bank intended—essentially speculating on their own currency without any national concern for the consequences. They themselves will ultimately suffer from the rising prices.
Al-Akari proposed solutions rather than further complicating the crisis, stating:
- Developmental spending is not a problem even if it creates a deficit, as it contributes to economic growth.
- The real spending issue lies in operational expenditures, which have surpassed 85 billion dinars (including salaries, children’s and spouse allowances, and the second chapter of the budget). These expenses drive up foreign exchange rates.
- A suggested solution is reducing salaries by 15%, without affecting low-income salaries (below 1,000 dinars).
- Eliminating barter transactions immediately.
- Implementing strict monitoring mechanisms for personal-purpose cards and documentary credits to ensure foreign exchange is used for its intended purpose, imposing severe penalties on those who falsify information.
- Reforming fuel subsidies, as the current system results in a loss of 45 billion dinars annually, benefiting smugglers at the expense of honest citizens. The solution involves:
- Gradually removing subsidies and setting fuel prices at 1 dinar per liter.
- Establishing two oil refineries to achieve self-sufficiency, financed through private sector investment in collaboration with banks.
- Separating Chapter III of the budget from the state budget to transform development projects (such as roads, electricity plants, oil refineries, and major agricultural initiatives) into investment projects funded by the private sector and financial institutions under the supervision of reputable foreign companies.
- Improving media discourse to educate Libyans on the shared responsibility for addressing economic challenges, avoiding fearmongering, and promoting productivity instead of negativity.
- Leveraging Libya’s wealth by diversifying sources of income through industry, agriculture, and tourism investments.
- Reducing embassy staff abroad to the minimum necessary.
- Requiring Libyan embassy employees abroad to deposit two months of their salaries annually in Libyan banks, receiving local currency in exchange.
- Imposing a rule for Libyans with foreign memberships to deposit at least 70% of their foreign currency earnings into Libyan banks in exchange for local currency.
Economist Anas Shneibish also provided a set of solutions in a statement to our source:
Urgent Solutions:
- Controlling the exchange rate: Through a calculated intervention by the Central Bank to regulate foreign exchange flows and curb speculation.
- Rationalizing public spending: By implementing strict policies to monitor and limit government expenditures.
- Accelerating the collection of oil revenues: By restructuring sales operations and renegotiating with partners to ensure steady cash flows.
- Strengthening foreign reserves: By imposing stricter controls on documentary credits and unnecessary transfers.
Long-Term Solutions:
- Diversifying income sources: By supporting industries, agriculture, and tourism to reduce dependence on oil.
- Encouraging local and foreign investment: Through economic reforms and ensuring political and security stability.
- Modernizing the banking system: By updating monetary policies and promoting financial inclusion.
- Boosting domestic production: By providing incentives to national industries to decrease reliance on imports.
Economic expert Abdul Hamid Al-Fadhil told our source: “Where is this massive amount of dinars coming from to demand such unprecedented levels of foreign currency for the fourth consecutive month?
From last December until March 12, total foreign currency usage amounted to approximately $11.5 billion, which translates to around 65 billion dinars requested in foreign exchange.
I cannot find an explanation for this unprecedented and alarming demand, except for parallel spending of extremely large sums by the parliament-appointed government, which may be sourced from (the use of commercial bank deposits + printing currency)!”
Thus, disclosing the amounts spent by the Hamad government and their sources of funding, as well as unifying public spending, has become a matter of utmost urgency that cannot be delayed.”
Economic expert Saber Al-Wahsh told our source: “Uncontrolled spending has pushed the demand for foreign currency to $2.3 billion, while revenues stood at just $778 million, resulting in a deficit of $4 billion in just two and a half months.”
He added: “Based on the latest statement and the Monetary Policy Committee meeting, I believe the central bank will resort to adjusting the exchange rate, thinking it is a solution, but it is merely a temporary fix.”
He continued: “The correct short-term solution is to unify and regulate public spending, ensure the stability of foreign revenues, and avoid deficit financing under any circumstances—except for salaries.”
