Tensions have emerged between the Head of the Presidential Council for the Government of National Accord (GNA), Fayez Al-Sarraj, and the Governor of the Tripoli based Central Bank of Libya (CBL), Sadiq Al-Kabir, over the country’s foreign exchange rates.
Al-Sarraj called on Al-Kabir to restart the CBL’s sale of the USD $5,000 individual allowances program to citizens at the official government rate.
Al-Sarraj outlined the urgent need for action, warning that a lack of precautionary steps would result in severe repercussions for the economy.
“There is a great need, according to popular demand, to stabilize the Libyan dinar against foreign currencies and exchange rates in the black market, which, if not dealt with threatens to destabilize economic reforms” he stated.
Al-Kabir complained of the GNA head’s reliance on the use of the ‘emergency law’ in demanding the CBL to restart the forex program was unjustified.
He accused Al-Sarraj of monopolizing decisions in the Presidential Council and of misusing the law, which was passed to deal with the threat of COVID-19.
He stated that the ‘emergency law’ should not be used for purposes other than to preserve the basic principles of the state system, rule of law, and separation of power, indicating that misuse of it may pose a greater threat to the country.
In March, Al-Sarraj requested the opening of the forex system under the supervision of the Presidential Council to determine foreign exchange sale fees and other financial policies for 2020.
This was strongly rejected by Al-Kabir, with several requests made to confront COVID-19, including liquidating salaries, opening a system of credits for the supply of food and medical goods, preparing financial arrangements for the year, carrying out exchange orders, and requesting coverage of emergency allocations to counter the pandemic.
Prominent businessman Hosni Bey stated that the best route out of this crisis was to unify the exchange rates for all purposes. This would stop thefts and lead to ending the difference in forex rates for hard currencies between the CBL and the black market.
Bey stressed that the different exchange rates was a major cause for corruption, with the US dollar worth 6 dinars on the black market, 3.60 dinars at the CBL rate and 1.36 dinars for official and government agencies.