Oil expert Abdulmonsef Al-Shalawi writes: \u201cOil Revenues Alone Are Not Enough\u2026 Where Are Libya\u2019s Dollars Going? An Analysis of the Central Bank of Libya\u2019s Statement from an Oil and Economic Perspective.\u201d<\/p>\n\n\n\n
I had hoped that, alongside the statement issued today by the Central Bank of Libya regarding the oil revenues received, it would also publish a corresponding disclosure detailing how foreign currency is used, broken down by purpose and beneficiary, with figures provided in US dollars. Assessing the monetary and financial situation cannot be complete by tracking what enters the banking system without knowing what leaves it and how it is used.<\/p>\n\n\n\n
According to the Central Bank\u2019s statement covering the period from January through the end of September 2026, oil revenues and royalties amounted to approximately $17.6 billion, compared with foreign currency expenditures of $22.3 billion, resulting in an estimated deficit of $4.7 billion. This gap warrants an analytical assessment that goes beyond simply announcing revenue figures, particularly given the Bank\u2019s statement that the deficit was covered by returns on its foreign investments.<\/p>\n\n\n\n
The published breakdown of foreign currency expenditures shows that commercial banks accounted for approximately $19.34 billion, comprising $10.11 billion in letters of credit, around $6.51 billion for personal purposes, $2.68 billion in transfers, and approximately $39 million through cards for small traders. Meanwhile, the Central Bank\u2019s direct expenditures amounted to nearly $2.98 billion, covering electricity, the National Oil Corporation, salaries for employees working abroad, medical supplies, and other obligations.<\/p>\n\n\n\n
This raises several fundamental economic questions: What proportion of this spending went toward importing essential goods, production inputs, and medicines? What share was allocated to fuel and energy? How many letters of credit actually resulted in imports reaching the Libyan market? And are these flows consistent with the economy\u2019s needs and the scale of domestic demand?<\/p>\n\n\n\n
The issue is not the letters of credit or personal transfers themselves, as each serves a legitimate economic function. Rather, the key requirement is to present a complete picture of foreign currency flows, assess how efficiently they are allocated, and establish whether the dollars designated for different purposes actually achieve the objectives for which they were approved.<\/p>\n\n\n\n
It is also important to distinguish between a surplus recorded in Libyan dinars and a deficit recorded in foreign currency. These are different indicators and one cannot be treated as sufficient evidence of monetary and financial stability. Public revenues may record a surplus in dinars while external payments exceed available foreign currency receipts, placing pressure on foreign assets and the exchange market.<\/p>\n\n\n\n
From this perspective, what we need is not merely periodic revenue statements, but an integrated oil and financial balance sheet linking oil production and exports with revenues actually collected, dollar expenditures, outstanding obligations, and changes in foreign assets. It should also include detailed data that can be compared monthly, allowing the sources of imbalances to be identified rather than merely documenting their consequences.<\/p>\n\n\n\n
In a previous research paper on redirecting oil expenditure to build a sustainable Libyan economy, I emphasized that the challenge is not limited to the amount of oil revenue generated. It also concerns how that revenue is managed, allocated, and used to protect the productive capacity of the sector that finances the largest share of the state\u2019s public finances.<\/p>\n\n\n\n
True transparency does not simply mean knowing how many dollars entered Libya. It means knowing how many dollars left, to whom they went, for what purpose, and what economic value citizens and the national economy received in return for that expenditure.<\/p>\n\n\n\n
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Oil expert Abdulmonsef Al-Shalawi writes: \u201cOil Revenues Alone Are Not Enough\u2026 Where Are Libya\u2019s Dollars Going? An Analysis of the Central Bank of Libya\u2019s Statement from an Oil and Economic Perspective.\u201d I had hoped that, alongside the statement issued today by the Central Bank of Libya regarding the oil revenues received, it would also publish […]<\/p>\n","protected":false},"author":13,"featured_media":258599,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"iawp_total_views":0,"_asgm_disable_schema":false,"_asgm_disable_faq":false,"_asgm_disable_howto":false,"_asgm_disable_llms":false,"_asgm_llms_description":"","footnotes":""},"categories":[2],"tags":[613,614],"class_list":["post-258589","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","tag-libya","tag-oil"],"acf":[],"yoast_head":"\n