By Libya Herald reporter.
Tunis, 10 November 2015:
The Central Bank of Libya (CBL) has revealed that it has opened letters of credit . . .[restrict](LCs) worth LD 875 million for 81 companies to import flour for subsidised bread.
The letters of credit in hard currency were opened at an exchange rate of 1 US$ to LD 1.39. The current black market rate is around LD 3.30/dollar.
The CBL says that it had examined the legal and customs authority documentation of these companies very thoroughly and that on the basis of these thorough examination LCs were approved.
With the opening of these LCs, the CBL stressed that its role as a financial institution thereby ended.
It added that it now falls to other oversight and accountability institutions such as the Audit Bureau, the Administration Control Authority, the Council Police and Customs Police and other price control institutions to play their role.
It also now falls to other institutions to monitor and control prices and to fight smuggling so as to ensure that flour arrives at its intended destination, the bakeries, to make subsidized bread, and not to other non-sanctioned uses and for smuggling outside Libya.
The CBL stressed that it was neither an executive nor a judicial branch.
The Bank also revealed that there were other companies that wished to import flour but failed to gain its approval due to their documentation not being in order.
These were referred to the relevant authorities such as the Audit Bureau, the Administration Control Bureau and Public Prosecutor’s Office for possible money laundering offences.
It will be recalled that the CBL and the Audit Bureau have come in for public criticism for bread shortages due to flour shortages. The CBL has received criticism for failing to open hard currency letters of credit for flour importation.
The CBL has also been criticised for failing to control the corrupt distribution of foreign currency contributing to the spiking in the FX exchange rate of the Libyan dinar on the black market. [/restrict]
