UNSMIL calls for work to start on a unified Libyan budget – without delay

UNSMIL has today called on all the conflicting Libyan parties to start work immediately on agreeing on a unified state budget.

The UNSMIL statement read as follows: ‘‘UNSMIL takes note of the statement issued by the Central Bank of Libya (CBL) Board of Directors following its first meeting in 2025 (on 29 January) and underscores the urgent need for consensus on a balanced, unified budget.

A transparent and equitable budget is crucial for strengthening fiscal responsibility, optimising resource allocation, and ensuring economic stability in Libya. A unified budget would also enhance the CBL’s ability to implement effective monetary policies, stabilise the exchange rate, and manage public spending sustainably.

In this context, UNSMIL calls on all relevant authorities to work towards an agreement on a unified budget without delay.’’

Comment
Currently, while sharing most parts of the western budget operated by the Tripoli based government (including salaries, subsidies and development), funded by the Central Bank of Libya, and monitored by the Audit Bureau and the Administrative Control Authority – eastern Libya also has its own untransparent budget.

The Hafter controlled eastern Libyan administration has various untransparent, unaccountable earnings such as those by the Military Investment Authority (MIA).

Economic reform
As UNSMIL mentions, it is hoped that a unified budget would reduce, or ultimately eliminate, the budget deficit, achieve a sustainable balanced annual budget, save Libya’s investment earnings for development, and strengthen the Libyan dinar’s weak exchange rate.

A unified budget should better enable a Libyan government to reform, diversify and decentralise the overcentralised welfarist economy inherited from the 42-year Qaddafi regime.

This reform is essential to moving Libya forward away from the rentier state and in preparation for the post-oil era.

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