Libya’s rival eastern and western legislative bodies have signed a US-mediated agreement to unify public spending across the divided country for the first time in over a decade, the central bank announced on Saturday.
The north African nation has struggled to recover from the turmoil that followed the 2011 Arab Spring uprising, which toppled longtime ruler Muammar Gaddafi. Libya remains split between a UN-recognised government led by Prime Minister Abdulhamid Dbeibah in Tripoli and an eastern administration in Benghazi backed by military leader Khalifa Haftar.
“This step reflects real progress toward unifying fiscal policy and strengthening the good management of public spending,” the central bank said of the new budget, describing the agreement as “the first consensus on unified spending across Libya in over 13 years.”
The deal was signed by Issa Al-Arebi, a representative of the Benghazi-based House of Representatives, and Abdul Jalil Al-Shawish, a representative of the High Council of State in Tripoli. Despite generating $22 billion in oil revenues last year—an increase of more than 15 percent compared to the previous year—Libya faces a foreign currency deficit of $9 billion, according to the central bank.
Last January, the bank devalued the dinar by nearly 15 percent for the second time in less than a year, citing issues including the lack of a unified state budget. The central bank said the new agreement would bolster financial stability and commended “the positive role of the United States in supporting mediation efforts” between the two sides.
Libya holds Africa’s largest oil reserves at around 48.4 billion barrels and currently produces about 1.5 million barrels per day while seeking to increase output to two million. Prime Minister Dbeibah also thanked Trump’s senior adviser on Arab and African affairs, Massad Boulos, for “supporting the mediation efforts that led to this agreement.”
“This is a step that carries promising signs, but the true test remains the serious commitment of all parties, so that it translates into tangible results for citizens in their daily lives,” Dbeibah said in a statement.
