No Result
View All Result
Friday, June 20, 2025
23 °c
Tripoli
24 ° Sat
24 ° Sun
  • Advertising
  • Contact
LibyaHerald
  • Home
  • Libya
  • Business
  • Opinion
  • Magazine
  • Advertising
  • Login
  • Register
SUBSCRIBE
  • Home
  • Libya
  • Business
  • Opinion
  • Magazine
  • Advertising
  • Login
  • Register
No Result
View All Result
LibyaHerald
No Result
View All Result
Home Business

CBL defends its financial performance, protection of Libyan dinar value

bySami Zaptia
November 12, 2015
Reading Time: 3 mins read
A A

By Libya Herald reporter.

The CBL defended its financial performance blaming the fall in oil exports for the fall in value in the Libyan dinar.
The CBL defended its financial performance blaming the fall in oil exports for the fall in value in the Libyan dinar.

Tunis, 12 November 2015:

The Tripoli-based Central Bank of Libya (CBL) defended its performance as a financial institution during . . .[restrict]Libya’s current financial crises caused mainly by the fall in oil production and the crash in international crude oil prices.

In a lengthy response to criticism on social media the CBL responded to accusations that it has not been effective in defending the FX rate of the Libyan dinar nor that it had taken action against the currency black market.

The CBL rejected claims that the loss of value of the LD were caused mainly by a loss of confidence in the LD. It maintained that the strength of a state’s currency comes from its foreign currency reserves.

RELATED POSTS

CBL Governor Issa launches transformational financial projects, including National Strategy for Financial Inclusion

Electronic Payment Forum and Exhibition – 20 to 22 May at Tripoli International Fairgrounds

It pointed to the fact that the LD – US$ rate up to the 1970’s was about US$ 1 – LD 0.30 and at the end of the 1980’s and the beginning of the 1990’s it had peaked at about US$ 1 – LD 3.50 and furthermore, during the revolution in 2011 it had reached US$ 1 – LD 1.90.

After liberation in October 2011 the exchange rate came down to US$ 1 – LD 1.30 within a week which was nearly the equivalent to the official exchange rate. This, the CBL maintained, shows that it was not as a result of confidence but as a result of the availability of hard currency.

Countering another accusation, the CBL denied that it has been forever turning a blind eye to the currency black market. It pointed out that it had acted forcefully against the black market in the week after liberation (from Qaddafi) in 2011.

This action proves that the LD exchange rate was based on foreign reserves and not on confidence. This is especially so for Libya, the CBL argued, a country that depends on 95 percent of its GDP from oil revenues and depends on more than 70 percent of its daily consumption on imports.

With regards to the CBL’s failure to allow official foreign exchange bureaux to start operating despite the law for such FX bureaux having been passed, the CBL revealed that it could not activate the bureaux because there has been a ban in place prohibiting the export of foreign currency to Libya since December 2013.

The CBL also countered the accusation that it had failed to prevent the unprecedented ballooning of the state budget and failed to control the expansion of state-sector salaries within it as well as running an annual budget deficit.

It highlighted the fact that the drafting of the budget was the responsibility of the executive (the government) and its approval is the responsibility of the legislature (parliament).

Its role, it points out, is advisory and consultative, pointing out to a number of official financial statements and warnings including its latest statement on the country’s finances up to 30/09/2015.

The CBL also strongly denied any responsibility to the accusation that it had contributed to the opening of a large number of corrupt documentary letters of credits (LCs). It countered that its role and powers together with commercial banks are defined and limited by existing laws and byelaws.

Nevertheless, in its effort to counter corruption in LCs it had referred to the Public Prosecutor’s Office cases totalling more than LD 4 billion in value for the years 2012-2015. The CBL also claimed that it had stopped money to successive governments from 2011 until today in the billions of dinars.

The CBL also countered that the accusation that the current low rate of oil production of around 300,000 b/d does not reflect on the FX rate of the Libyan dinar. It also refuted the accusation that it is unwilling to use its foreign currency reserves to bolster the LD FX rate.

The CBL pointed out that Libyan oil production had peaked at 1.6 million bpd in 2012 and that at a price of about US$ 100 / b that used to earn Libya around US$ 58 billion per year. However, with Libya’s oil production at around only 300,000 b/d this (at US$ 100 / b) would only earn Libya around US$ 11 bn still leaving a shortfall of US$ 47 bn.

Moreover, with the price of international crude oil prices crashing to around US$ 40 / b Libya would only earn US$ 23 bn per year even if it were to produce its peak production capability of 1.6 million b/d.

However, in reality Libya is only exporting around 300,000 b/d which would earn it around US$ 4 bn, whereas it is consuming around US$ 25 bn. To this the CBL asks the rhetorical question: Where does the power of the Libyan dinar lie, in market confidence or in Libya’s hard currency reserves?

In concluding, the CBL maintained that it is one of the very few Libyan institutions to maintain its professional performance with transparency, responsibility and courage, despite the difficult circumstances it operates in. [/restrict]

Tags: black marketCBL Central Bank of LibyafeaturedFX foreign currency exchangeLD Libyan Dinaroil

Related Posts

Sirte Free Zone meets Oman Chamber of Commerce at Oman Agrofood 2024
Business

Sirte Free Zone discusses port development and infrastructure projects with China Harbor‎ Engineering Company

June 16, 2025
LBBC leads delegation to Tripoli of 30 business representatives
Business

Libya Energy Conference, London, 2 July

June 16, 2025
CBL receives results from meetings with international banks
Business

CBL Governor Issa launches transformational financial projects, including National Strategy for Financial Inclusion

June 16, 2025
CBL and Madar launch Sadad mobile e-payment service
Business

Electronic Payment Forum and Exhibition 2025 opens at Tripoli Fairgrounds

June 15, 2025
Preparatory Committee for 30th session of the Libyan-Italian Economic Forum holds second meeting
Business

Libyan Italian Forum for Development and Reconstruction to be held in Benghazi from 25 to 26 June

June 15, 2025
CBL reduces annual hard currency transfer limit for individuals
Business

Libya’s economic reality: limited resources, liquidity challenges, inflation, and need for monetary base restructuring – Husni Bey

June 15, 2025
Next Post

Tripoli Chamber hosting workshop on solar energy

Libya pressed at Malta summit to stem migrants

Libya pressed at Malta summit to stem migrants

ADVERTISEMENT

Top Stories

  • Sirte Free Zone meets Oman Chamber of Commerce at Oman Agrofood 2024

    Sirte Free Zone discusses port development and infrastructure projects with China Harbor‎ Engineering Company

    0 shares
    Share 0 Tweet 0
  • Libya Energy Conference, London, 2 July

    0 shares
    Share 0 Tweet 0
  • Libya’s economic reality: limited resources, liquidity challenges, inflation, and need for monetary base restructuring – Husni Bey

    0 shares
    Share 0 Tweet 0
  • Construction work progressing at Benghazi’s new Tika airport

    0 shares
    Share 0 Tweet 0
  • 187 new security posts taken over from militias – PM declares victory for the state as all vital Tripoli sites come under its exclusive control for the first time since 2011

    0 shares
    Share 0 Tweet 0
ADVERTISEMENT
LibyaHerald

The Libya Herald first appeared on 17 February 2012 – the first anniversary of the Libyan Revolution. Since then, it has become a favourite go-to source on news about Libya, for many in Libya and around the world, regularly attracting millions of hits.

Recent News

187 new security posts taken over from militias – PM declares victory for the state as all vital Tripoli sites come under its exclusive control for the first time since 2011

The Interior Ministry had spent LD 50 billion in 13 years with no result: Acting Interior Minister Trabelsi

Sitemap

  • Why subscribe?
  • Terms & Conditions
  • FAQs
  • Copyright & Intellectual Property Rights
  • Subscribe now

Newsletters

    Be the first to know latest important news & events directly to your inbox.

    Sending ...

    By signing up, I agree to our TOS and Privacy Policy.

    © 2022 LibyaHerald - Powered by Sparx Solutions.

    Welcome Back!

    Login to your account below

    Forgotten Password? Sign Up

    Create New Account!

    Fill the forms below to register

    *By registering into our website, you agree to the Terms & Conditions and Privacy Policy.
    All fields are required. Log In

    Retrieve your password

    Please enter your username or email address to reset your password.

    Log In
    No Result
    View All Result
    • Login
    • Sign Up
    • Libya
    • Business
    • Advertising
    • About us
    • BusinessEye Magazine
    • Letters
    • Features
    • Why subscribe?
    • FAQs
    • Contact

    © 2022 LibyaHerald - Powered by Sparx Solutions.

    This website uses cookies. By continuing to use this website you are giving consent to cookies being used. Visit our Privacy and Cookie Policy.