2018/05/21 – Little has been known or even touched upon by media and the press about the millions of dollars militias have been making in illicit dealings in Libya black market, especially the capital Tripoli.
Libya Black Market: Where Economy is made
Since the advent of 2015, the Libyan Dinar (LYD) has seen a sharp drop in value as a war in Tripoli and another in Benghazi broke out a year earlier and a new era of fighting and political conflict had begun.
All transfer agencies like Western Union and MoneyGram were closed not only due to security reasons but also due to militias’ intimidation.
Militias with different ideologies: some religious and other boss-style have managed over the course of three years to own the Libyan foreign currency market; the Central Bank of Libya (CBL) was placed on the shelf.
Two main black markets that are solely run by armed militias in Libya: Sooq Al-Musheer in the old city of Tripoli and Dahra market also in downtown Tripoli have been busier since 2015 than any other financial department in the state institutions of the Libyan government.
Foreign currency exchange was hence subjected to the grip and mood of those militias taking the rate from around 2 LYD per 1$ in 2015 to gradually 3LYD, 4LYD, 5LYD, 6, 7, 8, 9 and in some days last year 10LYD to settle it these days on the 6.5LYD per 1$.
What was the government action:
The government of national accord in Tripoli cannot act. Why? A German Study published last month by the German Institute for International Security and Affairs answers, saying: ”
The German study explains that Since the establishment of the UN-backed Government of National Accord (GNA) in Tripoli, in March 2016, a handful of local militias have gradually brought much of the Libyan capital under their control.
It adds that although nominally loyal to the GNA, these armed groups today, in fact, dominate the government.
“They have grown into criminal networks straddling business, politics, and the administration. The pillaging of state funds – a hallmark of Libya’s political economy – now benefits a narrower group than at any previous point since the 2011 revolution.” The study indicated.
What actions the CBL took
The CBL and over the course of two years tried to solve the issue of the devaluation of the Libyan currency by adding more money to the bank accounts of the militias running the black market in the war-ridden country.
In February 2017, the CBL decided to allocate 400$ at the official bank rate (1.40 LYD) to every family member in Libya and in 2018, the CBL increased the amount to 500$ per family member, but Libyans can only cash the money out in foreign banks outside Libya.
Or, the alternative is ready of course, they can go to the dealers at the black market, as if by sheer coincident without the knowledge and content of the CBL, and sell the money they bought at the official rates in higher rates and add to the misery of the Libyan dinar and thus allow the militias to recollect the foreign currency sold by the CBL to Libyans.
One ray of hope, or is it?
Will there be any hope expected from the current calls for reform by the Audit Bureau and the Adminstarritive Authority which both have been blocking banks accounts of figures and firms accused of money laundering and smuggling as well as illicit business and embezzlement? A question officials are helplessly trying to avoid answering!.