Libya Country Profile
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Country Name: Libya Capital: Tripoli Land Area: 1.8 million km2 Population: 6,411,776 (July 2015 est) Currency: Libyan Dinar (LD) GDP Growth: -6.1% (2015 est) GDP: $41.14 billion (2014) Dialling Code: +218 (00 218 from UK) Main Industries: Oil, petrochemicals, aluminium, iron and steel, food processing, textiles, handicrafts, cement
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he country’s financial services sector needs much new investment in its infrastructure to enable dramatic improvements to modernise it to the benefit of economic prosperity. At present Libya has one of the most underdeveloped banking sectors in North Africa and has long functioned as a largely cash economy.
Efforts have been made to encourage the entry of foreign banks, but around 90% of the country’s banking assets remain in the hands of a small number of state-owned entities. Outstanding challenges that urgently need to be addressed concern staff training and upgrading inadequate IT infrastructure which means inevitably there is a lack of the usual banking facilities available to the consumer such as ATMs. As a result, many consumers remain quite unfamiliar with modern banking services. Banking activities in Libya are governed by Banking Law No 1 of 2005, together with regulations and guidance issued by the central bank, which is responsible for granting approval of foreign participation in a Libyan financial institution. The level of foreign ownership has normally been restricted to 49% and all banks must be structured as joint stock companies.
• The development of financial procedures to speed up banking services in the country; • Continuation of the work of electronic payment systems and the follow up of updates; • Technical development of best practices in sorting, counting and destruction to ensure the quality of currency in circulation; • Create an appropriate environment for the work of the Libyan Stock Exchange (LSE) to improve ec nomic performance; and • To ensure that notes and coins meet the needs of the Libyan citizen and branches of commercial banks according to the geographical distribution of the state and work to modernise and develop security procedures. On 4 May 2016 the Central Bank of Libya reported that Saddek Elkaber, the Governor of the Central Bank, had hosted a meeting in Tripoli with general managers of the country’s commercial banks during which they
The liquidity crisis that Libya confronted in 2011 is considered to have been one of the most severe tests of the country’s banking system since the early 1960s. The central bank took measures that proved successful in helped avoid bank insolvency.
discussed banking issues related to facilitating the daily life of citizens, issues dealing with safety of banks, and reviewed efforts to provide immediate liquidity including the activation of electronic payment services. Meanwhile, a committee of the Central Bank with
The Central Bank of Libya based in Tripoli is
responsibilities for letters of credit, held a meeting
responsible for regulation of the banking sector.
on 28 April 2016 with general managers of commercial
The bank first started its operations on 1 April 1956
banks. Discussions focused on the need to accelerate
although it derives its present functions and powers
procedures for opening documentary letters credits by
from the country’s Bank Law No 1 of 2005.
commercial banks in accordance with the regulations in Circular No.2 of 2016. The banks also emphasised
The bank aims to modernise and develop the industry
the need to expedite the issuance of electronic cards
in accordance with international standards and its
and accelerate the opening of transfer services for the
stated priorities include:
public according to legislation.
Arab British European Banking & Finance Guide
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