Economic expert, Nour El-Din Al-Hbarat, commented on the Central Bank management’s statement, appointed by the Presidential Council, regarding a foreign currency deficit of $2.7 billion. He noted that this statement only includes the foreign currency amounts that have actually been received or paid, which is accurate from an accounting perspective. However, there is no deficit in the balance of payments in the statement released by Al-Kabeer amounting to $9.1 billion.

Al-Hbarat explained that the first reason is that the value of previous commitments to public entities appeared in the balance of payments at the end of 2023 and thus should not be carried over or re-shown in the 2024 balance of payments. The deficit for that year is deducted from the foreign reserve value. The second reason is that if these commitments have not yet been paid, they should not be included in the balance of payments for the previous or current year under uses.

Al-Hbarat added that while the new Central Bank statement is accurate from an accounting perspective, the economic situation is entirely different. Announcing no deficit in the balance of payments might encourage the government to expand public spending and increase the money supply. This could lead to greater use of foreign currency in a country that relies almost entirely on imports for its goods and services. Such a scenario would likely increase demand for foreign currency, leading to a rise in the dollar exchange rate, higher inflation rates, and liquidity shortages, especially given the volatility of global oil prices, Libya’s sole source of foreign currency.