IMF warns of overspending by Libya’s eastern authorities

The International Monetary Fund has warned that authorities in eastern Libya spent around 60 billion dinars ($12.5 billion) in 2024 without reporting it in official budgets, AFP reported. The IMF said this excessive, opaque spending, combined with shutdowns at oil fields due to conflict, pushed Libya from a projected fiscal surplus into a deep deficit.

The country remains divided between rival administrations in the east and west since 2014, complicating financial oversight and governance. The IMF urged agreement on a unified budget and called for greater transparency, including the publication of audited financial accounts and oil revenue data.

It also recommended phasing out foreign exchange restrictions and enhancing anti-money laundering efforts to rebuild trust in the banking sector, which faces liquidity shortages. The IMF noted that powerful armed groups continue to undermine anti-corruption reforms and control parts of the economy, posing a risk to Libya’s fragile recovery.