After holding its first full board of directors meeting in six years on 16 December, the Central Bank of Libya (CBL) said it would devalue the dinar to $1=LD4.48 from 3 January for “all goods and all governmental, commercial and private foreign currency transactions.” If the Bank follows through, the spread between the official and black-market rate could be largely eliminated, potentially spurring growth and bringing about a measure of stability to the economy.
Access to the current $1=LD1.4 official rate is mainly restricted to the state, as well as limited allowances for businesses and citizens – but it has also been exploited by corrupt officials and militias. As a result, the black-market rate for the Libyan dinar has often fetched several times the official rate. It currently stands at about $1=LD6. The Tripoli-based government imposed a 183% tax on the official rate in late 2018 in a bid to narrow the gap, effectively creating a third rate (MEES, 29 March 2019). (CONTINUED - 238 WORDS)