World Bank Warns of Rise in Libya’s Public Debt

World Bank Warns of Rise in Libya’s Public Debt
World Bank Warns of Rise in Libya’s Public Debt

The World Bank has warned of a rise in public debt in Libya, as the debt reaches about 126% of government revenues.

The gross domestic product (GDP) currently stands at $45.8 billion, while the share of the citizen is $6.725 annually, according to the report.

The report believes that the fragile security and political context are undermining the proper functioning of institutions in Libya. This is due to armed clashes, protests, and poor maintenance work which disrupted oil production and export, as the economy decreased by 1.2% in 2022 due to conflict-related restrictions on oil production.

The report was titled “Altered Destinies: The Long-Term Effects of Rising Prices and Food Insecurity in the Middle East and North Africa.” It believes that by January 2023, production had rebounded to 1.2 million barrels per day, partly offset by a 15% expansion in the non-fuel sector considering the huge financial incentives offered by the authorities.

The report found that the security situation has witnessed some improvement in Libya in recent months in general. This calm could bring some benefits to economic development, however, the war in Ukraine created additional pressure.

The World Bank warned against continuing to rely heavily on the hydrocarbon sector. Any disruption in oil production or a drop in international prices could be rapid and have a significant impact on growth and the state’s ability to pay its public debts.

In general, the country’s economic future depends largely on the prospects for peace and stability, as the World Bank’s experts assume fragile political progress in 2023 in the continued relative stability of the security situation.

Notably, Parliament Speaker, Ageela Saleh, met with Deputy Prime Minister in the Parliament-designated government, Ali Al-Qatrani.

In the meeting, which took place in the city of al-Qubba, Saleh stressed the need to liquidate the sums required for the government to implement its programs.

During the meeting, they also discussed ways to solve problems facing the support of the government sector and Ministries, in addition to supporting the distribution of fodder.