Libya’s Banks Became More Liquid. Productive Credit Barely Moved.

Nine months of balance-sheet movement

Three Central Bank of Libya bulletins covering October 2024 through June 2025 show a financial system becoming larger and more liquid without a comparable shift toward productive credit. Broad stability is a real result, but it is not the same as structural reform.

M1 rose from LYD 106.3 billion to LYD 122.1 billion. Cash outside banks increased from LYD 38.1 billion to LYD 43.2 billion, while banks’ excess reserves climbed from LYD 47.7 billion to LYD 58.5 billion. Together, those movements describe more money and more idle liquidity—not automatically more investment.

Liquidity expanded faster than productive credit

Total lending increased from LYD 26.5 billion to LYD 30.9 billion, yet agriculture still received 0.3% and industry 4.1% of credit. The balance-sheet expansion therefore remained concentrated in trade and services rather than the sectors expected to reduce import dependence.

A stable market did not mean a transformed economy

The bulletins recorded an official rate of LYD 4.837 per dollar, import cover of 5.6 months and a parallel-market gap near 6% at the period end. Those are dated indicators, not permanent achievements; they must be read alongside the exchange-rate regime, oil receipts and later policy changes.

The bulletin series should become a public dashboard

The period also brought Islamic certificates of deposit, currency-note withdrawals, the Ratibak Lahzi salary platform, LYPay and circulars limiting credit expansion or temporarily stopping some financing for legal entities. Each measure needs an outcome indicator: uptake, transaction volume, cost, exceptions and effects on access.

By June, reported revenue was LYD 73.4 billion and spending LYD 56.9 billion, but development spending was only LYD 2.96 billion—about 5%—while salaries and subsidies absorbed 88%. Publishing the bulletin tables as downloadable time series would let the public test the central conclusion: the financial architecture moved more than the productive economy.