Libya’s Central Bank Higlights Importance of Transparent Public Spending

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On Saturday, the Tunisian capital hosted a meeting between the Governor of the Central Bank of Libya (CBL), Al-Siddiq Al-Kabir, and the United States (US) Ambassador to Libya, Richard Norland, to discuss issues related to public spending and transparency.

During the talks, Norland reiterated his appreciation of efforts by the CBL to enhance transparency and provide greater information about the use of public funds.

The US Embassy in Libya said in a statement that Ambassador Norland was briefed on the bank’s ongoing reunification efforts.

It added that the US hoped this process will provide tangible benefits to the Libyan people.

Norland underlined his belief that progress on the CBL’s re-unification is an important aspect of the wider process of reconciliation that should continue in all sectors.

On his part, the CBL Governor stressed that they have adopted positive new steps to increase transparency in public spending that will enhance the accountability of Libyan financial and economic institutions.

The CBL said the steps are being taken with the aim to give Libyans confidence that national funds are spent for their benefit.

In January, Al-Kabir told Reuters that he believed the first stage of unification could be accomplished by July. Economic divisions have added to Libya’s chaos and resulted in differing exchange rates, liquidity shortages, and ballooning public debts that further hurt Libya’s battered economy.

In December 2021, the CBL announced a plan to end the 7-years of division between the eastern and western banks. It said in a statement that the two officials had met in Tunisia, and agreed on a detailed plan to unite the bank.

They discussed the stages of the unification in accordance with the roadmap proposed by the international accounting firm Deloitte. The international financial audit review for the CBL was completed in July.

“The division complicates access to foreign exchange, impedes monetary reform, and undermines the integrity and oversight of the commercial banks,” the United Nations Support Mission in Libya (UNSMIL) said.

“The division complicates access to foreign exchange, impedes monetary reform, and undermines the integrity and oversight of the commercial banks,” it added.

To ensure independence and best practice, the United Nations Office of Project Services (UNOPS) managed the procurement process that resulted in the selection of Deloitte as the independent auditor.

“The unification of the CBL is no longer simply recommended but required. The division complicates access to foreign exchange, impedes monetary reform, and undermines the integrity and oversight of the commercial banks. The division, in combination with the lack of a unified budget, contributed to both banks accruing debt to finance the respective former governments,” according to Deloitte’s review.