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Exclusive: Among Them Adjusting the Required Liquidity Ratio Against Depository Liabilities… Central Bank Governor Plans to Launch Reform Package

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The Governor of the Central Bank of Libya intends to launch a series of reforms that began unfolding two days ago. These reforms aim to strengthen the value of the Libyan dinar, preserve reserves, ensure financial sustainability, and secure the desired economic stability.

Among the measures is the issuance of new instructions regarding the adjustment of the required liquidity ratio to be maintained against depository liabilities.

Exclusive: Central Bank Governor to Present Reform Plan That Could Eliminate Foreign Currency Sales Tax

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The Central Bank of Libya told our source exclusively: “The Governor of the Central Bank of Libya will present a memorandum that includes a reform plan for the economic situation aimed at increasing the value of the Libyan dinar.”

The Central Bank stated: “If the reforms are approved and implemented within a maximum period of two months, the 15% tax imposed on foreign currency sales will be lifted, and the exchange rate at the bank will be fixed at 5.56 only, in accordance with the decision of the Bank’s Board of Directors.”

Exclusive: Central Bank: “There Is Still a Chance to Improve the Dinar’s Value by Removing the Tax, and We Will Present a Swift Reform Plan”

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The Central Bank of Libya told our source in an exclusive statement: “We have taken measures to correct the exchange rate, setting it at 5.56 dinars per dollar, while maintaining the 15% tax.”

The bank added: “There is still an opportunity to improve the value of the dinar by removing the tax—if reform measures and spending unification are implemented. The Central Bank will present a rapid reform plan, and we will not allow speculators to continue operating in the market.”

The statement continued: “We hope all parties will cooperate quickly. The opportunity for reform is available, and improving the situation is possible despite local and international challenges.”

Exclusive: Central Bank Approves New Board of Directors for Assaray Bank

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Our source has exclusively obtained a letter confirming that the Central Bank of Libya has approved the appointment of new members to the Board of Directors of Assaray Bank.

The newly appointed members are:

  • Basem Ali Qasim Tantoush
  • Ahmed Ali Ahmed Atiga
  • Mohamed Abu Bakr Al-Safi Al-Menfi
  • Ehab Lotfi Ahmed Al-Shahawi
  • Mohamed Omran Mohamed Abu Kra’a
  • Monjia Al-Taher Omar Nashnoush
  • Refqa Abdel Majid Abdul Qader Al-Kout
  • Zaid Al-Freij Mohamed Al-Bassiouni
  • Rakan Jalal Ibrahim Hosni Bey
  • Abu Bakr Abu Al-Eid Abu Al-Qasim Abu Al-Eid
  • Osama Wahbi Ahmed Al-Bouri

Exclusive: Central Bank Issues Circular Amending the Mandatory Cash Reserve Ratio Against Deposit Liabilities

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Our source has exclusively obtained circulars from the Central Bank of Libya addressed to commercial banks regarding the amendment of the mandatory cash reserve ratio against deposit liabilities.

The Central Bank revealed that the Board of Directors has issued Decision No. (20) of 2025 concerning the amendment of the mandatory cash reserve ratio on deposit liabilities for commercial banks subject to this requirement. Article One of the decision states the following:

The mandatory cash reserve ratio that commercial banks must maintain with the Central Bank of Libya against their deposit liabilities—pursuant to the provisions of Articles (57), (58), and (59) of the Banking Law—is to be amended to 30% (thirty percent) of the total deposit liabilities subject to this ratio.

Exclusive: Including a Maximum 7% Expansion in the Financing and Investment Portfolio – Central Bank Issues Key Instructions to Banks

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Our source has exclusively obtained circulars from the Central Bank of Libya addressed to banks, aimed at ensuring the stability and strengthening the resilience of the banking sector, particularly in terms of influencing the volume, type, and duration of credit and financing, in a way that meets the actual needs of economic activity in production and services.

The instructions state that the maximum allowable expansion in the size of the credit portfolio – the financing and investment portfolio – for the financial year 2025 shall not exceed 7% of the bank’s existing portfolio balance. Furthermore, banks must adhere to the instructions when granting credit and financing, which must be based on a thorough study of the client and the associated risks, and must include all the requirements stipulated by the Central Bank of Libya.

It is also necessary to review, update, and develop credit/financing and investment policies, as well as related risk management policies, to keep pace with market changes and economic conditions. These policies must at least meet the minimum requirements set by the Central Bank of Libya.

Banks must also manage the credit/financing and investment portfolio in a way that reduces the ratio of non-performing loans and limits individual and sectoral concentration. The portfolio should be diversified by setting limits to address concentration risks across various levels and activities.

Periodic review and updating of standards and conditions related to granting credit and financing must be conducted whenever necessary, in order to avoid any future risks to the banks.

In addition, efforts must be made to train and qualify staff in managing credit/financing and investment portfolios, and in applying best practices in risk management, by enrolling them in certified and specialized training programs to enhance their competencies.

Al-Tarhouni: “In Light of the Central Bank’s Decisions… Where Is the Standard of Living in Libya Headed?”

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Economic expert Dr. Abdullah Wanis Al-Tarhouni wrote:

Many have voiced their opinions following the release of a circular or statement by the Central Bank of Libya regarding revenues and expenditures for January and February 2025. Frankly, the statement is incomplete and its figures inaccurate. Its main aim appears to be preparing Libyan public opinion for the upcoming scenario—something that became evident with the first working day after the Eid al-Fitr holiday.

Fundamentally, the Central Bank is responsible for monetary policy, which must be aligned with other economic policies. Therefore, publishing expenditure data is primarily the role of the Ministry of Finance, as it is responsible for fiscal policy, not the Central Bank. Moreover, anyone claiming that Libya’s crisis is purely economic either misunderstands the situation or is focusing on details while missing the core issue. Libya’s crisis is a deeply political one, and the economic imbalances began in 2014—when the political turmoil started, followed by oil shutdowns, wars, and internal conflicts. Therefore, returning to the root of the problem is the foundation of any solution.

Today, as Libyans, we stand at a crossroads. With Trump rising to power, crude oil prices dropped, forcing Libya to diversify its income sources to fill the financing gap and catch up with Gulf countries that are already far ahead. I believe it is time to listen to experts and wise voices, and to learn from nations that have endured what we have.

On the technical side, some believe that Law No. 1 of 2013, which prohibits usury in Libya, has deprived the Central Bank of one of its key tools: interest rates. This has made the exchange rate the only mechanism available since 2013. Personally, I don’t fully agree with this view. The country needs to activate the stock market, regulate government spending through a proper budget law, control foreign labor, and—most importantly—revive the role of regulatory bodies and fight corruption relentlessly.

It goes without saying that spending without a budget law, the dysfunction of regulatory bodies, the continuation of crude-for-refined oil barter arrangements, and the ongoing shutdown of local refineries—along with printing over 100 billion dinars while keeping old currency editions in circulation—will inevitably lead us to bankruptcy sooner or later. Solving these four major issues could stabilize the economy, but it won’t fully recover without addressing other influencing factors.

Currently, trade, fiscal, and monetary policies operate in isolation. Meanwhile, the Central Bank’s Board of Directors issued Resolution No. 18 of 2025, devaluing the national currency to fill the financing gap and avoid drawing from reserves. However, this decision will only increase poverty due to inflation and widen the gap between the wealthy and the underprivileged. Reports suggest the decision was made with half the board members agreeing—not the majority—thus violating the Libyan Banking Law. The Central Bank would be better off halting loans to the government (except for Chapter One of the budget), and even that should only be disbursed through the “Aysar” system controlled by the Central Bank.

Without repeating what has already been published, several Libyan experts—including Dr. Mohamed Abu Snena, Dr. Mohamed Mohamed Al-Shahaty, and Dr. Omran Al-Shaibi—have proposed mechanisms to address current distortions in the Libyan economy. Central to these proposals is the legal control of public spending through a budget law, the closure of the majority of Libya’s embassies, consulates, and missions abroad (which are double the number of U.S. missions), tightening controls over Letters of Credit and currency transfers, withdrawing and burning 50-dinar notes as part of a plan to remove at least 50 billion dinars from the market, raising customs duties on luxury and non-essential goods, restarting local refineries, and—simultaneously—restructuring state institutions through proper integration and elimination based on valid criteria, while also correcting the situation of foreign labor.

In any case, whether we like it or not, returning to a real economy based on agriculture and industry is inevitable. We must wake up from the illusion brought about by the “Dutch disease” that has plagued Libya as it did other nations before us. In the coming years, we must secure our food from our vast lands, promote small and medium industries, expand industries related to crude oil, and support innovation and the knowledge economy.

In conclusion, I believe Libya’s crisis is political, not economic. The measures listed in this article are merely responses to a decades-old issue. We need years of thoughtful planning to restore Libya’s dignity and allow its people to live with pride on their own land.

Exclusive: Ruvinetti Reveals the Consequences of the Exchange Rate Change and Its Impact on Libyan Families

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Italian strategic expert Daniele Ruvinetti told our source on Tuesday that devaluing the Libyan dinar will increase the cost of imports, which could significantly impact Libyan households, given the country’s heavy reliance on imported goods.

Ruvinetti confirmed to Sada that inflation may rise, which is an increasing concern as it reduces the purchasing power of citizens who have been suffering from economic instability since 2011. The timing of the decision raises questions: Why now?

He continued, “The Libyan economy has been fragile for years, burdened by political divisions and public debt—which reports indicate has reached 330 billion dinars. This move could be a sign of deeper financial challenges or a response to dwindling reserves, despite the Central Bank’s insistence that its goal is to maintain stability.”

Ruvinetti pointed out that ultimately, this appears to be a temporary fix for Libya’s structural economic problems. The country’s overreliance on oil along with its fragmented political landscape limits the effectiveness of monetary policy. Without broader reforms—such as unifying the split branches of the Central Bank or tackling corruption—this currency devaluation could simply delay addressing deeper issues, he said.

Exclusive – Commenting on the Central Bank’s Exchange Rate Adjustment Decision: Ghaith: The Justifications Presented Are Not from the Central Bank but from the Government, and What’s Happening Is Speculation and Brokerage in Dollars

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Former member of the Board of Directors at the Central Bank of Libya, Mrajaa Ghaith, stated exclusively to our source regarding the Central Bank’s decision to adjust the exchange rate:

“I believe this decision is hasty and came at the wrong time. Why adjust the exchange rate right after the Central Bank reduced the foreign exchange tax?”

He continued: “Why hasn’t the Central Bank published Resolution No. 18 regarding the exchange rate adjustment? What it did publish on its official page is merely the updated official exchange rate and the new buy/sell prices. So why not publish the decision, especially since it’s not classified?”

He added: “Certainly, the citizen is the one most affected in all cases — we said this when the tax was imposed, and we say it again with the exchange rate. We import 100% of what we need. On top of that, during this time when the world is facing a crisis and prices could rise or there could be an economic recession — you go and raise prices even more?”

Ghaith further stated: “The justifications mentioned are not those of the Central Bank of Libya; these are government justifications. The government has a deficit — let it figure out how to cover it. It’s not the Central Bank’s job to solve the government’s problems.”

According to Ghaith, since currency sales are under the authority of the Central Bank, it can impose tighter controls and limit wasteful use.

“But saying that nearly 2 billion is for personal use — this is all speculation and dollar brokerage.”

Ghaith concluded: “I advise the Central Bank to float the Libyan dinar and spare us. As long as it’s going to follow the black market, every time the rate goes up, the official rate goes up with it! Float the dinar — and may it reach 20 — and let them take responsibility.”

Exclusive: Zarmouh: A Series of Contradictions and Disturbances in the Decisions of the Central Bank of Libya

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Economics professor at the Libyan Academy, Omar Zarmouh, commented exclusively to our source on the Central Bank of Libya’s decision regarding the exchange rate adjustment, saying:

What is surprising in the decisions issued by the Central Bank of Libya on Sunday, April 6, is that they carry within them a series of contradictions and disturbances that such a prestigious bank should not have fallen into, being the most important economic institution in the country. These include the following:

  1. When the new administration took over its duties, it pledged to strengthen the value of the dinar. What we are witnessing today is the opposite.
  2. The administration insisted on continuing to impose the tax, which was initially 27%, then reduced to 20%, and again to 15%, defying court rulings that declared it invalid. There is no economic or legal justification for continuing with it.
  3. As part of the insistence on imposing the tax, recent rumors have emerged suggesting that the tax will be increased to 33%. Although I don’t believe rumors, by testing this one, it turns out that reducing the value of the Libyan dinar by approximately 13% while keeping the 15% tax is equivalent to imposing a 33% tax. This means that the bank’s administration may have actually intended to raise the tax to 33% but failed to do so, substituting it with a devaluation of the dinar. This indicates the administration is inconsistent in its decisions and lacks a coherent economic policy. This inconsistency is demonstrated by the shifting rates (27%, then 20%, then 15%, then effectively 33%), especially in light of the previous analysis of the 33%.
  4. In October 2024, the administration decided to increase the personal transfer allowance from $4,000 to $8,000, only to reduce it now to $2,000, along with a review of foreign currency transfer regulations. This contradicts previous statements from the administration claiming the bank is ready to meet all foreign currency demand. Doesn’t this shake public confidence?
  5. The issue is that such decisions appear to be based on nothing but emotion or trial-and-error (“hit or miss”) and are not grounded in any solid economic principles or theories.

He concluded:

Finally, I urge the Bank’s administration to put the ‘goal of monetary stability’ at the forefront of its objectives, to rely on science, and to steer clear of experimentation—whose failed outcomes are well-known in advance to economists.

Abu Snina: “Proposals to Save the National Economy from Collapse”

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Written by economic expert Mohamed Abu Snina: What we have repeatedly warned about has now occurred. Although much of what was mentioned in the statement issued by the Central Bank of Libya today is known to many, it serves as a declaration and warning that what lies ahead will be worse for the Libyan economy and the ordinary citizen. Distortions have affected the foundations of the macroeconomy. When the public debt to GDP ratio reaches 125%, when public expenditure exceeds total income by 165%, and when the economy suffers from a deficit in the general budget and the balance of payments (also known as the two gaps), then the economy is in a real and dangerous crisis.

When foreign currency revenue in the first quarter of 2025 is about 4.6 billion dollars, this predicts further deterioration of economic conditions, and the Central Bank will not be able to defend the exchange rate of the Libyan dinar, exposing it to further depreciation.

The Libyan economy is threatened by entering a double inflation spiral and a deficit, with the financial sustainability of the state faltering. The government may cease its operations (government closure) as oil revenue is no longer sufficient to pay salaries from the public treasury following the sharp decline in oil prices.

In the face of these unprecedented conditions, those at the forefront of the scene and the House of Representatives have no choice but to abandon political wrangling and take urgent measures to save the present and future of the Libyan economy, and to prevent further deterioration in the living standards of citizens. These measures should include the following:

First: Assigning a small rescue government across all Libyan territories, halting the waste and imbalance in public expenditure, and taking responsibility for preparing and implementing an economic and financial reform program that is presented to the House of Representatives and issued as law.

Second: Approving a general austerity budget for the state before the middle of the fiscal year 2025, within the limits of available resources and the absorptive capacity of the national economy.

Third: The first application of the reform and rescue program should target government institutions themselves by truly unifying divided sovereign institutions, making them accountable and subject to follow-up.

Fourth: Reducing, abolishing, and restructuring many of the newly established administrative units (ministries, embassies, public institutions, and agencies), and reducing the number of employees within them.

Fifth: Reorganizing the priorities of developmental spending and seeking sources of financing outside the general budget, reforming subsidies, combating fuel smuggling, and tackling money laundering activities.

Sixth: The Central Bank commits to not lending to the government or financing any unlisted expenditures in the general budget. It should work to limit the increase in the money supply, improve the use of exchange rate policy, and not use this policy to address the results of inefficient public expenditure policies. The Central Bank should cease destabilizing the exchange rate and recognize that adjusting the exchange rate will not solve the problem of the disorganized Libyan economy.

Seventh: Subjecting revenues from crude oil and gas exports to accompanying review and audit, limiting the National Oil Corporation’s authority in handling oil revenues, and ensuring full and transparent remittance of these revenues to the Central Bank of Libya on time.

Eighth: Consolidating and unifying all foreign currency reserves and deposits available at various state institutions (Libyan Investment Authority, Long-Term Fund, Libyan Foreign Bank, Economic Development Fund, and other institutions with foreign currency assets) in order to protect and manage them properly. These funds should be placed under the control of a single entity, the Financial Stability Committee, chaired by the Central Bank of Libya, to address potential challenges that may threaten the future of the state, and to be used to support the stability of the exchange rate of the Libyan dinar until the economic and financial conditions stabilize.

The required rescue program will come with economic and social costs that should not be borne by the citizens alone or vulnerable groups. The proposed rescue government must take full responsibility for reducing public expenditure, halting corruption, and abolishing many newly introduced spending items. It should focus on providing essential public services, ensuring security, protecting borders, eliminating new and duplicated administrative units, and working to increase non-oil sovereign revenue (taxes and customs duties), collecting revenues from domestic fuel sales, and remitting profits and surpluses from telecommunications companies and public enterprises to the general revenue account in the treasury.

Vulnerable segments of society must be provided with the necessary social protection to prevent them from falling below the poverty line. The proposed rescue government, relevant institutions, and all related entities (legislative, executive, and advisory) should focus on preparing a vision for the future of the Libyan economy, aiming to restructure it to diversify sources of income and reduce the oil sector’s dominance over economic activity in the long term.

Exclusive: Central Bank Issues Reminder on 50-Dinar Withdrawal Deadline and Urges Action from Citizens and Banks

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Our source obtained a reminder from the Central Bank of Libya regarding the deadline for withdrawing the 50-dinar banknotes by the end of April.

The Central Bank stated: The final date to accept both the first and second issues of the 50-dinar banknotes in commercial banks is April 30, 2025.

As the Central Bank of Libya informs citizens of this, it also requests all banks and their branches to allow the public to deposit the mentioned currency into their current accounts. It also calls on them to organize operations in a way that enables smooth and easy deposit procedures within the time frame specified in the decision.

The Central Bank also urges citizens to sort and classify each version of the 50-dinar notes separately, in order to facilitate the deposit process.

Exclusive: Husni Bey Comments on the Exchange Rate Adjustment: The Majority Calls for Reform but Rejects Change, Insisting on Tools and Mechanisms Proven to Fail

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Libyan businessman Husni Bey told our source in an exclusive statement:
In my view, the rate approved, with an added 15% fee, actually represents a devaluation of the exchange rate, not an increase as the majority perceives it.

All I hope for is that this 15% fee is used to extinguish public debt and reduce the money supply by 15 billion dinars annually for three years, without being used to fund any government activity.

He continued: I hope observers and economists revisit the stages following the unification and adjustment of the exchange rate on 3/1/2021, where they can confirm its positive effects. It brought price stability, and thus exchange rate stability, leading to a degree of relative security as the wars stopped (Kaniyat in 2018 and Tripoli in 2019). Through this stability, the economy saw relative growth.

He added: The government managed to pay child, wife, and distressed daughter allowances since 2013. All Libyan families benefited at an average of 4,250 dinars per family per year. The parallel exchange rate remained stable for two years, until speculation and instability returned in Q3 of 2023.

He went on: Since Q3 of 2023, and for a year and a half, we haven’t seen the dollar in the free market below 6.200 LYD. In fact, in March 2024, it exceeded 8.200 LYD/$, with a gap surpassing 50%.

He continued: The Governor of the Central Bank of Libya prioritized growing the reserves by purchasing 24 tons of gold, supporting the bank’s reserves with $4 billion in 2023, and adding another $2 billion in Q1 2024. However, despite this, the dinar collapsed in Q1 2024, exceeding 8.000 LYD/$, which led to the imposition of a 27% fee in Q2 of the same year.

The question: What is the real price of the dollar? The official rate or the market rate? In my conviction, the real rate is the market rate, and the official rate is nothing but a “safety belt” granted to speculators.

He added that the dollar has exceeded 7.000 LYD in the past week, and the success or failure of the official rate policy with a 15% fee should be measured by evaluating the dollar at 6.400 LYD including the fee. It is a successful policy if the dollar drops in the parallel market to below 6.700 LYD/$, indicating a 4% drop. To prove the theory and equation, the price trend in the parallel market must be monitored.

He said: I affirm that I do not believe in anything called an “official rate,” “fixed rate,” or price support for goods, services, or currency. In economics, there’s no such thing as price support, and it’s unacceptable to protect speculators and grant them guaranteed profits that exceeded 20% in Q1 2025 and 50% in Q1 2024.
It is unreasonable that the dollar is sold on one side of the street, only to be resold on the other with guaranteed speculation profits exceeding 20% — this is economic madness. And I am astonished by those who defend the status quo.

He confirmed that many economists use buzzwords like “sustainability” and “economic reform”, but refuse to deal with the two biggest black holes in public spending:

  1. The wages chapter, estimated at 65 billion dinars, of which only 60% are real salaries, while the rest goes to items like per diems, uniforms, accommodation, bonuses, and other extras.
  2. The second black hole is the subsidy policy for fuel and energy, which devours nearly 40% of our oil production, estimated at 77 billion dinars annually, and steadily increasing. These products are subject to theft, smuggling, and misuse (based on the mindset of “if it’s free, take more”).

In recent years, a new drain emerged called external fuel swaps, which make up 66% of the total fuel bill, while the remaining 34% is consumed locally since 1982 — comprising locally refined fuel, gas, heavy oil, and Ubari power station oil.

He concluded: The majority calls for reform, but they reject change, and insist on adopting tools and mechanisms that have proven failures, expecting different results after 70 years of failure.

Libyan Economic Experts Urge Immediate Reforms Amid Growing Crisis

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Sada republishes an important message from a group of economic and financial experts regarding Libya’s economic situation and proposed solutions. They said: Following the report published yesterday by the Central Bank of Libya, which included alarming figures and assigned responsibilities resulting from the state of governmental division, and the ensuing rampant and inflated dual spending, waste, and corruption, both governments — East and West — emerged, each accusing the other and holding it responsible for the deterioration of the country’s financial and monetary conditions.

The experts added: This is what experts and concerned observers have warned about for a long time, and they have presented clear remedial solutions.

Since December 2024, a group of experts has been calling for consensus on an open letter addressed to the executive, monetary, and legislative authorities, including proposals to address the financial and economic chaos — as a preemptive step before reaching the point of collapse.

This open letter, signed by a group of experts and previously published by Sada newspaper, is being republished today in hopes that it will find listening ears.

Regarding the current economic situation:

Anyone who cares about the Libyan people must tell them the whole truth. Therefore, sugar-coated speeches and alignment with the distortions of the economic situation only serve narrow interests and are a gamble with the country and future generations.

Living standards have declined over the past decade, with poverty rates increasing, individual shares of GDP shrinking, and actual inflation and unemployment rates rising significantly, along with the erosion of citizens’ savings. The vast disparity in economic opportunities among citizens threatens a political explosion due to accumulating feelings of marginalization — whether real or perceived — and this becomes even more likely when those feelings align with narratives of regional and social marginalization.

Macro-financial indicators have reached levels that threaten financial sustainability and undermine stabilization efforts. It is therefore imperative to launch a comprehensive program to restructure the Libyan economy.

Institutional division — both horizontally and vertically — has increased the confusion in the state’s economic and financial management. Regardless of any proposed temporary solutions, they cannot replace the need to unify administrative and financial decisions by unifying all political institutions and renewing their legitimacy through general elections.

Regarding the general budget:

The state’s general budget is originally meant to reflect strategic vision and serve as a tool for funding, oversight, and monitoring. Unfortunately, it is currently used solely for current expenditures, which robs it of effectiveness and weakens its political and societal credibility.

A unified budget that includes all government spending items across Libya is essential. Despite all possible reservations, a unified budget remains better than any financial arrangements.

The budget should be realistic and take into account actual needs and expected revenues. It should also be based on macroeconomic and sectoral indicators — both quantitative and qualitative — to enable monitoring and evaluation within the framework of fiscal policy. The absence of economic indicators in general budgets reflects a disappointing, exploitative approach to public funds.

Regarding revenues:

All public entities tasked with collecting public revenues must fulfill their duties. No entity should retain or deduct any portion of revenues for any reason or transfer them to an unauthorized party.

All proceeds from the sale of oil, gas, petroleum derivatives, and all other sovereign revenues — without exception and within their due deadlines — must be deposited into the General Revenue Account of the Ministry of Finance.

In a country that primarily relies on oil revenues, the National Oil Corporation must disclose detailed monthly data on its exports, including quantities of each crude type, selling prices, the foreign partner’s share, and the public treasury’s share.

Regarding spending controls and standards:

The government and the National Oil Corporation must urgently end the oil cargo swap system used to supply the local market with fuels. These needs must be precisely identified and imported in specified quantities, and the NOC should contract with global refineries under transparent procedures. The NOC and the General Electricity Company must conduct monthly reconciliations to determine the actual fuel and gas supplies received by the company.

For both economic and security reasons that affect stability in Libya, fuel subsidies must be restructured according to a studied and gradual policy that includes a social safety net, enhances citizens’ purchasing power, and — most importantly — gains public trust through transparency and communication.

Rationalizing spending in wages and subsidies may be a harsh and painful procedure for certain social groups. However, the state must pursue a policy of truth with citizens and stop appeasing public opinion or serving factional interests.

For budget year 2025, the following spending rationalization measures must be implemented:

  • Halt all government hiring and salary increases throughout 2025 to allow for an accurate employee census and to determine actual staffing needs. Review the release of financial entitlements due to observed irregularities.
  • Issue a unified salary scale that reflects living standards and provides a reasonable balance between high and low grades.
  • Review inflation in budget items such as food allowances, accommodation, and vehicle purchases.
  • Reduce the number of entities funded by the public budget by merging public institutions with similar purposes.
  • Reduce the number of Libyan embassies and diplomatic missions abroad and the number of personnel working in them.
  • Stop spending large sums of public money without clear priorities on social programs such as marriage support, unless accompanied by economic and field studies that demonstrate their impact on the targeted groups.

We urge the relevant authorities to activate and support the following institutions due to their vital roles in economic development: Civil Status Authority, Real Estate Registry, Statistics and Census Authority, Tax Authority, Urban Planning Authority, Public Property Authority, and Customs Authority.

Development priorities should go to energy, electricity, essential social services, and infrastructure projects. In all cases, financial allocations for targeted projects must be clearly identified by name, geographical distribution, estimated value, and required cash flow over the implementation period.

It is essential to commit not to transfer funds from Chapter III (Development) to other chapters in the general budget.

Regarding budget execution monitoring and evaluation:

The authors of this message recognize that the general budget contains structural realities that are difficult to bypass — such as the bloated number of employees, citizens’ dependence on subsidies, and widespread corruption in the administrative system. However, they also understand that addressing structural imbalances and fighting corruption takes time, requires determination, and must be carefully planned so that well-intentioned policies do not turn into uncalculated decisions that fuel further conflict.

All public entities, without exception, must be subject to oversight rules from regulatory bodies to promote transparency and governance.

It is necessary that all public entities publish monthly reports on revenues and expenditures, as well as reports on development projects, their costs, and any financial or time deviations.

The Audit Bureau and the Administrative Control Authority must issue quarterly reports on development spending, in addition to the annual report in the first half of the following year to address violations before they worsen.

All state institutions must close their final accounts to enable the determination of their financial positions and the calculation of obligations and debts owed by the public treasury.

Regarding accompanying reform measures:

We urge legislative and executive institutions and think tanks to review all laws related to the state’s financial and economic system. These reviews must be carried out systematically and consultatively to ensure smooth implementation.

Until that happens, institutions must manage their finances in accordance with current laws and in a spirit of cooperation and professionalism that should prevail among state institutions.

A population census and essential surveys must be conducted to provide reliable indicators for economic decision-making and proper timing.

Economic and financial data must be provided and published in a comprehensive and reliable manner.

Resources must be allocated to municipalities, granting them the authority to spend on their identified development priorities.

Priority in public procurement and contracting should be given to the Libyan private sector.

The public treasury must not bear any financial commitments that do not have allocated provisions in the general budget. The Ministry of Finance must be responsible for the sound management of Libyan state assets — including public companies and sovereign funds — and must work to maximize their revenues without disposing of them outside the general state budget.

Procedural steps for budget approval:

If the economic situation is exceptional, the 2025 budget must also be handled exceptionally. To ensure its approval, commitment, and smooth implementation, wide political consensus among key stakeholders is necessary, along with active coordination between technical bodies and relevant political institutions.

The Central Bank of Libya must maintain its independence and operate strictly within the powers defined by Libyan legislation to preserve its professionalism and neutrality. Coordination with the Ministries of Finance and Economy must be arranged in a way that allows each to exercise its powers without overlap.

In conclusion, seriously and responsibly addressing the economic challenges requires launching a comprehensive political process that integrates all its tracks without delay or postponement by the UN mission. If Libya needs a solid national charter among its political and social components, it also needs a deep dialogue on the desired economic model — one that should guide the work of all institutions and address the deep-rooted and recurring causes of conflict.

Exclusive: Al-Harati Speaks on the Risks Highlighted by the Central Bank Data That Led to the Devaluation of the Libyan Dinar and Its Accompanying Effects

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Legal advisor Hisham Al-Harati spoke exclusively to our source stating: “What is happening in Libya is a blatant example of a betrayal of trust, as corrupt parties entrusted with the responsibility of running the state are seizing the Libyan people’s funds through illegal means and administrative violations. This constitutes a criminal offense that infringes on the rights of Libyan citizens and exposes them to enormous economic and social risks.”

He added: “According to Libyan law, these acts are criminalized and subject to punishment. Therefore, every individual who has participated in this unjust course of action must bear criminal responsibility before the Libyan judiciary, and justice must take its course without leniency or favoritism.”

He went on to say: “The crime of looting and betrayal of trust is not merely an individual act, but rather an organized crime that threatens the state’s stability and its economic and social security. It is unacceptable for corruption to infiltrate every corner of the state without accountability.”

He concluded: “The law must be the invincible shield against this blatant violation of the people’s rights, and the Libyan people must pressure the judiciary to assume its role as outlined by law—ensuring accountability and preventing criminals from escaping punishment—so that all are equal before the law, and justice is not limited to those without connections or influence, as has unfortunately been the case for years.”