Libyan Prime Minister Abdulhamid Dbeibah has met with the governor of the Central Bank of Libya, Naje Issa, to align government and monetary authorities on urgent measures to improve liquidity, tighten foreign exchange controls and stabilise prices, officials said.
In a statement published on the government’s official platform on February 16, the meeting focused on easing persistent cash shortages in commercial banks, which have triggered widespread public complaints over limited access to funds. The two sides discussed steps to boost cash availability and improve the functioning of the banking system, as authorities seek to restore confidence in financial institutions.
Dbeibah and Issa also examined measures to strengthen oversight of the foreign exchange market, a long-standing pressure point in Libya’s fragmented economy. Weak regulation and multiple exchange rates have fuelled speculation, distorted prices and undermined purchasing power, prompting repeated calls for tighter controls.
Officials said the meeting reviewed the issuance of letters of credit for the importation of essential goods, underlining the need to ensure adequate domestic supply and limit price volatility. Imports play a critical role in Libya, which relies heavily on foreign goods for food, fuel and consumer products.
Both sides reaffirmed their commitment to implementing a previously agreed financial arrangement aimed at preventing further depreciation of the Libyan dinar and protecting household incomes. Currency instability has been a major driver of inflation in recent years, amplifying the cost of living for ordinary Libyans.
The discussions also covered benchmark pricing mechanisms for food imports, designed to curb inflation and limit speculative behaviour by aligning local prices with global market rates and domestic cost structures. Officials said such benchmarks would help improve transparency, reduce arbitrage opportunities and bring greater predictability to prices in local markets.
Dbeibah stressed the importance of sustained coordination between the government and the central bank to reinforce economic stability and ensure the consistent provision of essential goods. “Close cooperation is necessary to address citizens’ concerns, stabilise prices and support economic recovery,” the statement quoted him as saying.
Libya has struggled to rebuild its economy after years of conflict and political division, which have weakened institutions and disrupted policy coordination. Although oil production has recovered at times, revenues have not consistently translated into financial stability, with liquidity shortages, inflation and exchange-rate pressures remaining persistent challenges.
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Analysts say closer alignment between fiscal authorities and the central bank could help address structural weaknesses, but warn that lasting stability will depend on broader reforms, improved governance and a more unified political framework.
Libya’s economy has faced persistent instability since the 2011 uprising, which left the country divided between competing administrations and disrupted state institutions. Years of political fragmentation have weakened fiscal management, undermined public confidence in banks, and created chronic liquidity shortages.
The Central Bank of Libya (CBL) plays a critical role in managing the country’s monetary policy, but it has faced difficulties in controlling multiple exchange rates, preventing dinar depreciation, and ensuring sufficient cash circulation in commercial banks. Currency instability has fueled inflation and eroded citizens’ purchasing power, especially as Libya depends heavily on imports for essential goods such as food, fuel, and medical supplies.
Repeated public complaints about limited access to funds have highlighted structural weaknesses in the banking system. Meanwhile, fluctuations in the Libyan dinar against foreign currencies have made imports more expensive, contributing to rising prices and widespread uncertainty in local markets.
The government has sought to coordinate closely with the central bank to implement financial arrangements aimed at stabilizing the dinar, managing liquidity, and curbing price volatility. Mechanisms such as letters of credit for essential imports and benchmark pricing for food products have been introduced to align domestic prices with global market trends, limit speculation, and ensure supply stability.
Despite periodic recovery in oil revenues, which form the bulk of Libya’s government income, economic stability remains fragile. Analysts say that sustained cooperation between the government and the CBL, combined with broader institutional and governance reforms, will be essential to restore public confidence, stabilize prices, and support economic recovery.
