Libya’s New Agreement to Align Financial Policies
Libya’s central bank announced an important agreement between the country’s two legislative bodies, aimed at creating a unified development program. This move seeks to align the financial strategies of the rival administrations in a framework they both accept.
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- Libya is a major oil producer with divided governance between west and east.
- The country has lacked a unified budget for over a decade.
- The new agreement focuses on unifying spending channels for development projects.
Implications of the Agreement
The agreement established by Libya’s central bank is expected to protect the macroeconomy from potential crises by unifying fiscal policies. This framework is crucial in managing oil revenues that have been a contentious point between the administrations.
- The central bank did not detail the program, but it signifies a strategic alignment.
- Development spending has been a key area for oil revenue allocation.
- The agreement could mitigate the risk of financial crises in the divided nation.
Political Background
The legislative bodies involved are the House of Representatives in Benghazi and the High State Council in Tripoli. The latter hosts the internationally recognized Government of National Unity (GNU).
- The GNU, led by Prime Minister Abdul Hamid Dbeibah, emerged from a U.N.-supported process in 2021.
- The House of Representatives no longer acknowledges the GNU’s legitimacy.
- The political rift traces back to Libya’s post-Gadhafi era after 2012.
By Ali Musa
Axadle Times international–Monitoring.
