The Tripoli-based Central Bank of Libya (CBL) refuted on Friday all accusations of financial and legal violations claimed by the CBL’s parallel administration in the eastern city of al-Bayda.
Bayada-based CBL accused its rival administration and its governor Sadiq al-Kabir of money laundering and issuing selective decisions targeting certain banks whose administrations are based in the eastern region, which is under the control of the Libyan National Army.
In a statement, the CBL in Tripoli said all its expenses are included in the general budget approved by the Presidency Council.
All appropriations come through commercial banks from different regions and the CBL has nothing to do with them but providing required legal documents.
However, the Tripoli-based CBL claimed that the audits showed recent violations at one of the banks, which included opening letters of credit that involve money laundering of $487 million. Other violations included illegal transactions to individuals at different banks.
The Tripoli-based CBL also accused its parallel administration of looting about LYD 40 billion, without giving further details.
The Central Bank in Tripoli has welcomed before the international supervision of the CBL’s rival administrations, after the Presidency Council asked the United Nations Security Council to form technical teams to follow up the work of CBL’s rival bodies in July, just a few days after the issuance of the Audit Bureau’s 2017 report which revealed financial violations.
A source from the Central Bank in Bayda told 218News previously that an international team was scheduled to conduct an inspection visit to the CBL in April, but the eruption of war in Tripoli delayed the visit.
Audit Bureau’s 2017 Annual Report
The Audit Bureau said that despite increased oil production and increased oil revenues into the Libyan state coffers, this increase was not used to improve the economy.
This it blames on the ‘‘austerity policy followed by the Central Bank of Libya,’’ which it says chose to allocate only $8.9 billion rather than $17.9 billion that had been agreed by all parties for the 2017 budget.
This tightening of the volume of hard currency allocations by the CBL was the cause of the rise of the black-market rate of the US dollar to LYD 9.5 per dollar in December 2017, the Audit Bureau said. This decision proves the premeditated austerity economic policy pursued by the CBL, added the Audit Bureau.
It said that more ‘‘balance’’ could have been achieved in the black-market if more ‘‘wise and organized’’ policy was pursued in the use of official hard currency.
This ‘‘lack of initiative’’ by the CBL has caused serious damage to the economy, empowered black-market foreign currency traders, encouraged the spread of corruption in society, and led to high inflation and general price rises.
The report also highlighted the inequality in the distribution of foreign currency for commercial and private purposes.
In February, the European Commission added Libya to a blacklist of 23 nations that pose a threat because of lax controls on terrorism financing and money laundering.