Libya Signs First Unified State Budget in 13 Years
Libya took a significant step toward fiscal unification on Saturday after the country’s two rival legislative bodies signed the first unified state budget in more than thirteen years.
The agreement, confirmed by the Central Bank of Libya and multiple international monitors, establishes a budget of approximately 190 billion Libyan dinars (roughly $38 billion at current exchange rates) to cover state spending for the fiscal year. The deal was described by the central bank as a “foundational step” toward financial stability and macroeconomic coherence.
The last time Libya operated under a single, unified national budget was in 2013, in the chaotic aftermath of the NATO-backed uprising that toppled longtime leader Muammar Gaddafi. Since then, the country has been split between two competing governments, each with its own spending priorities and revenue arrangements — a division that deepened after 2014 when armed factions seized Tripoli and eastern strongholds fell under the control of the Libyan National Army.
The budget agreement is the product of months of quiet diplomacy, according to Western diplomatic sources. The United States played a significant mediating role, pressing both sides to accept a formula for sharing oil revenues and allocating spending obligations. The UN mission in Libya also facilitated discussions, though the breakthrough was described as primarily American in origin.
Libya’s oil resources — among the largest in Africa — have been at the center of the conflict, with rival factions relying on oil revenue to fund armed groups and administration. Under the new arrangement, the Central Bank will oversee disbursements to both the Tripoli and Benghazi-aligned administrations according to an agreed formula.
Economic analysts cautioned that the budget unification, while significant, does not resolve the underlying political divisions that have kept Libya fragmented. “This is a fiscal agreement, not a peace agreement,” said a Middle East analyst at a European think tank. “The armed groups that control territory and revenue streams are not party to this document. But it does reduce the risk of a fresh financial crisis triggered by competing monetary arrangements.”
The Central Bank said the unified budget would “strengthen financial stability, improve the efficiency of public spending, and support the monetary policy framework.” It also pledged greater transparency in reporting and oversight.
The announcement was met with cautious optimism in European capitals, where officials have long pushed for Libyan reunification as a precondition for managing migration flows and regional security threats emanating from the country.