The United Nations Support Mission in Libya (UNSMIL) said in a statement today that it takes note of yesterday’s developments regarding the decision by the House of Representatives Presidency in relation to the leadership of the Central Bank of Libya (CBL).
UNSMIL was referring to the forceful installation yesterday of Fawzi Abu Khazam as a new interim CBL Governor.
UNSMIL said it underscores that the operational independence, integrity of the CBL together with the maintenance of coordination and unity of its operations across the country are essential to safeguard public resources, preserve economic and financial stability, ensure credibility with international financial partners, and protect the livelihoods of the Libyan people.
Changes to CBL leadership must be driven by commitment to improved governance
While fully respecting Libya's sovereign institutions and decision-making processes, UNSMIL emphasized that any changes to the leadership must be driven by a commitment to improved governance and oversight.
This, it added, is necessary to maintain the confidence of both internal and external stakeholders in the prudent management of the country’s monetary policy, foreign exchange and international reserves, economic stabilization and in the fulfilment of its obligations as the regulator of the banking sector.
Escalating public expenditure is unsustainable
Continued pressure on the CBL to finance escalating public expenditure, UNSMIL said, could further intensify pressures on the exchange rate, fuel inflation, and accelerate the depletion of reserves. Such a course is unsustainable and ultimately comes at the expense of the Libyan population and could inflict increased economic hardship with the possibility of social unrest.
As deliberations over CBL leadership continue, UNSMIL urged all stakeholders to act strictly in accordance with applicable Libyan legal and institutional procedures to protect the credibility of the CBL as an institution.
Central Bank of Libya Governor Naji Issa Ousted in Forced Transition