Al-Hibri optimistic about economic boost after modifying dinar exchange rate

Al-Hibri optimistic about economic boost after modifying dinar exchange rate

December 27, 2020 - 20:52
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Written By: AbdulkaderAssad

The Governor of the parallel Central Bank of Libya (CBL) and vice president of the board of directors of the CBL Ali Al-Hibri said the current exchange rate of Libyan dinar to foreign currencies isn't "balanced" so modifying it was very important.

Al-Hibri said in an interview on 218 TV Saturday that the Central Bank needs 18 months until it sees the exchange rate stable, saying he expects the new monetary policies will succeed by 90%.

"Selling US dollar to Libyans won't be in cash at this stage, rather by bank cards and transfers. The cash crisis is expected to be over by January 2021. Prices could go up relatively, but smuggling of commodities would be limited." Al-Hibri explained.

He said activating wife and children's allowance will start January as well with the support for medicines and fuel kept intact, adding that prices can go down up to 33% in the future as Central Bank policies will eventually lead to the end  of black market's activities.

"The fluctuation of Libya's GDP made the modification of exchange rates inevitable, plus the fact that it would help end corruption. Central Bank’s technical committee will report weekly to the board of directors to assess the ramifications of the new exchange rate. It will also issue a statement every six weeks on the monetary policy of the Central Bank. There will be also assessment of the black market's activity to compare exchange rates. A report on instructions for selling foreign currencies will be issued this week." Al-Hibri further explained.

He said the CBL board of directors will always hold meetings to assess the exchange rate, in addition to granting licenses for opening private exchange companies in the first quarter of 2021 and ending circulation of certain categories of bank notes.

The board of directors of the Central Bank of Libya held a unified meeting weeks ago for the first time since 2014, afterwards; many decisions were taken, including modifying the exchange rate of the dinar against foreign currencies.