Prime Minister of the Government of National Unity, Abdul Hamid Dbeibeh, affirmed his rejection of imposing a tax on the exchange rate due to its negative effects borne by the Libyan citizen, denying rumors about the deterioration of the country’s economic situation and its bankruptcy.
During his meeting with the President of the Supreme Council of State, Mohammed Takalla, and several members of the House of Representatives and the State Council, Dbeibeh refuted rumors about the deterioration of the country’s economic situation and its bankruptcy, explaining with numbers and statistics the value of public spending in the country over the past three years, including the development door through which several development projects have been implemented across the country.
Dbeibeh also revealed in his speech the revenues his government has achieved in hard currency, and what it has accomplished in extinguishing the public debt inherited from the previous governments, in addition to the government’s work to strengthen the country’s foreign currency needs, emphasizing his rejection of imposing a tax on the exchange rate due to its negative effects borne by the Libyan citizen.
The Minister of Labor and Rehabilitation in the Government of National Unity, Ali Al-Abed, discussed during his meeting today, Sunday, with the Director-General of the National Council for Economic and Social Development, Mahmoud Al-Futaisi, the economic aspect, labor market, and migrant labor.
The meeting, held at the Ministry of Labor headquarters in Tripoli, addressed ways to regulate and develop the labor market, reduce illegal labor presence, and address the difficulties facing labor procedures in accordance with the principles of sustainable economic growth and social development.
First Deputy Speaker of the House, Fawzi Al-Nuwiri, announced in a statement on Thursday his rejection of the decision made by Parliament Speaker, Aguila Saleh, regarding the imposition of a 27% tax on the exchange rate. He indicated that he and his fellow council members were surprised by the issuance of this decision, which has serious implications and disastrous consequences for the livelihoods of Libyans, according to the statement.
Al-Nuwiri added in his statement that this decision was made under pressure, interventions, and dictates of foreign countries through their embassies, and submission to these dictates represents a concession of national sovereignty. He emphasized that Aguila Saleh’s decision is clearly void and must be withdrawn or revoked, either by the issuer or by the House of Representatives collectively.
The First Deputy in Parliament, Fawzi Al-Nuwiri, criticized the Governor of the Central Bank, Seddiq Al-Kabeer, saying: “The governor’s hand must be restrained from acting unilaterally in monetary policy and imposing the use of foreign currency reserves exceeding 80 billion dollars, excluding gold, to strengthen the Libyan dinar, rather than placing reserves in unknown and unsafe hideouts, which is considered a crime that must be stopped and its perpetrators held accountable.”
Al-Nuwiri concluded his statement by calling for an emergency session of the House of Representatives to discuss this decision and take necessary actions regarding it, urging the Libyan judiciary to take urgent action to protect Libya, its people, and its economy from these destructive decisions and arbitrary actions.
The Speaker of the House, Aguila Saleh, issued Decision No. 15 of 2024, imposing a tariff on the official exchange rate of foreign currencies by 27% for all purposes, with the possibility of reducing the rate during the period of the decision’s validity from its issuance date until the end of the current year, 2024.
The decision stipulates that the revenue generated from the tax shall be used to cover the expenses of development projects if necessary, or added to the resources allocated to the Central Bank of Libya to pay off public debt under Decision No. 30 of 2023 issued by the House of Representatives.
The United States is taking steps to reopen its embassy in Libya after a decade-long suspension, prompted by concerns over Russia’s growing influence in the region. The State Department’s fiscal year 2025 request includes $12.7 million earmarked for potential embassy operations in Libya. This funding would support the establishment of a Diplomatic Travel and Support Operations Facility and increased use of dedicated aircraft for trips to Tripoli from Malta.
Highlighting Russia’s expanding presence on NATO’s southern flank, the budget request emphasizes the importance of maintaining U.S. presence in Libya to safeguard long-term security interests. Negotiations are underway for an interim facility in Tripoli to provide necessary security and staffing support.
The move to reopen the embassy coincides with Russia’s significant influence in Libya. Concerns have been raised about Russia spreading false narratives in the region, posing a strategic challenge to NATO’s southern flank. Marine Corps Gen. Michael Langley, head of US Africa Command, warned about the risk of countries in the Maghreb region falling under Russian influence.
Secretary of State Antony Blinken underscored the importance of diplomatic security, allocating $3.9 billion for Diplomatic Security and related programs to protect U.S. diplomatic operations globally, including the expanded presence in the Indo-Pacific, Libya, and the Eastern Caribbean.
The embassy in Tripoli was closed in 2014 amid civil unrest, following the attack on US facilities in Benghazi, which resulted in the deaths of Ambassador J. Christopher Stevens and three other Americans. Despite the reopening efforts, the State Department continues to advise against travel to Libya due to various security risks, including crime, terrorism, civil unrest, kidnapping, and armed conflict.
Khalifa Abdul Sadiq, a board member of the National Oil Corporation and chairman of the force majeure lifting committee at the corporation, held a bilateral meeting on Monday at the corporation’s headquarters in Tripoli with the general manager of the Polish company. This comes as part of the corporation’s encouragement of foreign companies to lift force majeure and resume their exploration activities after security stability in the oil regions.
During the meeting, the Polish company announced the lifting of force majeure and the resumption of its exploration activities in the areas granted to it in the Ghadames Basin starting from the beginning of next April. This comes after nearly ten years since the company declared force majeure in 2014, during which it achieved two gas discoveries in the Ghadames Basin area.
Khalifa Abdul Sadiq, a board member of the National Oil Corporation, welcomed this announcement, confirming that the corporation will provide all logistical facilitations needed by the company to fulfill its contractual commitment, including drilling exploration wells and seismic surveys.
During their meeting held today, Sunday, in the Egyptian capital Cairo under the auspices of the Arab League, the President of the Presidential Council, Mohamed Al-Manfi, the President of the House of Representatives, Aguila Saleh, and the Head of the High Council of State, Mohamed Takalla, agreed on the necessity of forming a unified government tasked with overseeing the electoral process and providing essential services to citizens, as well as unifying sovereign positions to ensure the activation of their roles at the level of the Libyan state.
The agreement also emphasized Libya’s sovereignty, independence, and territorial integrity, and rejected any negative external interventions in the Libyan political process. It also included the formation of a technical committee within a specified time frame to consider appropriate amendments to broaden the base of consensus and acceptance of the work accomplished by the “6+6” committee. The United Nations Support Mission in Libya and the international community were invited to support this consensus for its success.
At the end of the meeting, the attendees agreed to urgently hold a second round to finalize this agreement and put it into effect, commending the role of the Arab League in bridging viewpoints to achieve the completion of the electoral process in Libya.
During their meeting with the President of the House of Representatives, Aguila Saleh, experts and economics professors at Benghazi University confirmed their response to a memorandum from the Governor of the Central Bank of Libya, Seddiq Al-Kabeer, regarding the proposed imposition of a fee on foreign currency sales. They stated that the justifications provided by the governor are unrealistic and that resorting to devaluing the Libyan dinar is not an effective policy.
The experts clarified in their response that in 2021, the Central Bank stated that the liquidity problem would be solved, the Libyan dinar’s exchange rate would stabilize, and the Central Bank would gradually raise the value of the dinar. However, nothing of the sort has happened, and now they are attempting to devalue the dinar again for the same reasons and objectives, making the same promises as in the initial devaluation, which were not fulfilled.
The economists proposed solutions to Libya’s economic problems, aiming to achieve stability in the value of the dinar, preserve the citizens’ living standards, and possibly improve their well-being. They emphasized the necessity of injecting more foreign currency into the official market to maintain price stability. The Central Bank should continue to provide foreign currency even if current revenues cannot cover it. They assured that they would maintain the stability of the official exchange rate, which would encourage investors to retain their balances in Libyan dinars without any fear of future exchange rate fluctuations.
In addition to the solutions proposed by the experts, they suggested controlling public spending through a budget approved by the legislative authority and ensuring that it is not exceeded outside the budget. They also proposed revitalizing and developing other sources of financing for the general budget, controlling documentary credits, specifying import prices and quantities, increasing oil and gas production to boost state revenues in foreign currency, and forming a policy committee to coordinate economic policies and ensure no conflicts or contradictions between them.
The experts concluded in their response that there is no justification for imposing a fee on foreign currency sales or devaluing the dinar at the present time, especially after foreign currency revenues have exceeded expenses by more than 4 billion dollars over the past three years, according to central bank data.
The President of the House of Representatives, Aguila Saleh, stated in media remarks that the Governor of the Central Bank of Libya, Seddiq Al-Kabeer, “informed us that if we do not impose a tax on the sale of foreign currency, the exchange rate of the dollar in the parallel market will rise to 12 or 13 dinars, but if the tax is imposed, the dollar rate will stabilize.”
Aguila Saleh confirmed that the Finance Committee agreed to the request of the Central Bank governor to impose a tax on the sale of foreign currency until the end of the year, explaining that the council is convinced by the opinion of the experts at the central bank, and this decision will be issued, easing the situation, and the surplus from imposing the tax will be allocated to paying off the public debt.
The Soufa Center reported on March 6 that Libya remains deeply divided, with a UN-backed government in Tripoli and a rival administration in Benghazi. Efforts to unify the country through elections have stalled, as rival leaders, including Haftar, resist holding elections due to fears of losing power. The UN Security Council reaffirms its commitment to an inclusive political process, supporting the efforts of the UN envoy to implement a roadmap for elections.
Despite the political deadlock, the Tripoli administration is taking steps to enforce the rule of law and reduce militia influence, responding to public frustration and UN pressure. The Interior Minister announced an agreement for militia withdrawal from the capital, aiming to professionalize security forces. The US Embassy in Libya expressed support for these efforts, indicating ongoing engagement to promote peace and security.
The persistent power struggle in Libya allows external actors to strike separate deals with rival administrations, further fragmenting the political landscape. Russia’s engagement with Haftar extends to influencing the civil war in neighboring Sudan, where Haftar permits bases under his control to be used for shipping weapons to the Rapid Support Forces (RSF). Libya’s Dbeibah government has offered to mediate a settlement in Sudan to counterbalance Haftar’s influence.
Resolving Libya’s instability has become a priority for Egypt and Turkey, rival powers in the Eastern Mediterranean. Despite years of disagreements, including over support for Islamist movements, both countries recognize that a divided Libya does not serve their interests. Recent efforts to ease tensions, including Turkish President Erdogan’s visit to Egypt, signal a potential turning point in relations. A recent agreement between Turkey and Tripoli for specialized military training suggests ongoing cooperation, boosting hopes for the UN-led reconciliation process.
