A unified exchange rate for the Libyan dinar
As part of the change, the internationally recognized Government of National Accord suspended fees it imposed on foreign exchange transactions two years ago, bringing the official exchange rate closer to the black market rate.
The -board of directors of the Central Bank agreed on a new rate of 4.48 dinars to the dollar last month in its first full-body meeting in five years after the country was divided between warring factions in the West and East.
In Tripoli, the black market price reached five dinars to the dollar, after it fell last week towards the new official rate. “ We have to wait three or four months to see how things will go in commercial banks,” said Amer, a currency dealer, according to Reuters. Malik Al-Fakhry, an electronics dealer in Benghazi, said he stopped dealing with banks after 2013 because he lost large sums of money when importing at the official rate and resorted to the black market. “ What matters most to the trader is stability,” he said.
The -new exchange rate implies an actual devaluation of the currency, and means that the cost of imported goods will likely rise, but to unify the price of the dollar in the official and black market, it was a must.
“ This decision is wrong and will harm the citizens more than it will benefit them, and it only satisfies the merchants,” said Hatem Al-Barghathi, who is also from Benghazi. According to Reuters.
The -decisions are part of a broader effort to establish peace, encourage the implementation of agreed reforms and block the path to corruption.
Although the fighting between the Government of National Accord and the forces of eastern Libya (the Libyan National Army) led by Khalifa Haftar stopped in June following the failure of an attack on Tripoli, the pace of the political solution is moving at a slower pace.
The -ceasefire agreed upon in October was only partially implemented, and the forces are still deployed on the battle fronts, the main highway on the coast is still closed and the mercenaries have not left. By the end of this year, they had not reached an agreement on forming a new unified government to oversee the transitional phase.
Libyan oil production rose to 1.2 million barrels per day, at an unprecedented level since the ports and production fields were closed, at the beginning of this year.
Production has recovered since an agreement was reached to end the siege between the warring factions in the country, in mid-September.
The -last time Libya’s average monthly crude oil production was 1.2 million barrels per day, in April 2019, according to estimates by ARGOS Media concerned with energy affairs.
Despite the rapid recovery in production, over the past two months, the Chairman of the Board of Directors of the National Oil Corporation, Mustafa Sanallah, said that it is unlikely that his country will be able to obtain a production quota from OPEC +, until its production stabilizes at 1.7 million barrels per day – an average Shahry has not been achieved since 2008.