Libyan Central Reserve may decline 20% with the decline in oil revenues

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The Libyan Court of Audit expects the reserves of the Central Bank of Libya to witness a decrease of about 20% this year, due to the embargo imposed by the forces of eastern Libya on energy exports, which reduced revenues.The Diwan, which is based in the capital, Tripoli, said that the annual oil revenues are expected to decrease to 5 billion dollars from 31 billion dollars last year, which will reduce the reserves of the Central Bank to 50 billion dollars.

The forces stationed in the east stopped oil exports in December, and international oil prices collapsed after demand was affected by the Corona pandemic, with no possibility of a rapid recovery on the horizon.The Audit Bureau stated in a video posted on Facebook on Friday that the fiscal deficit is expected to reach 26.7 billion dinars, or the equivalent of 19 billion dollars this year, compared to a surplus of 11 billion dinars in 2019.

Although most of the oil production and export facilities are in the east, international agreements mean that they can only be sold by the National Oil Corporation in Tripoli, with revenue flowing through the Tripoli-based Central Bank of Libya as well.

The oil revenue is then used to finance state operations throughout the country, including salaries for public sector employees in the east as well as areas controlled by the National Accord government.Eastern forces halted exports in January and the price of oil has since fallen, leading to an immediate drop in revenue.

The Government of National Accord issued earlier this year the state budget with the expected spending, but without providing figures for the expected revenues.





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