ISTANBUL, Sept 12 (Askume) – Libya’s central bank, hit by deep cuts in oil output during a weeks-long crisis, remains isolated from the international financial system, senior central bank governor Saeed told Askume on Thursday.
The Central Bank of Libya (CBL) board of directors, appointed by Libya’s Western faction, controls the country’s internal payment system, but foreign banks have no business transactions with it, Sadeq Kabir said from self-imposed exile in Istanbul.
“All the international banks we work with, over 30 major international institutions, have suspended all transactions,” he said, adding that he is in touch with other institutions, including the International Monetary Fund, the US Treasury Department and JPMorgan Chase.
“All international operations have been suspended. Therefore balances or deposits cannot be received outside Libya,” he said.
The U.S. Treasury Department did not immediately respond to a request for comment. JPMorgan declined to comment, saying it could not discuss client relationships.
The International Monetary Fund is closely monitoring developments in Libya’s central bank management and supports efforts by the United Nations Support Mission in Libya to reach an agreement to end the impasse, an IMF spokesperson said.
However, a committee appointed by Western factions has taken control of Libya’s internal business system, including salary payments, Kabir said.
“Internal staff is back and the system is working,” he said.
The controversial committee appointed last month by Presidential Council Chairman Mohamed Menfi said it had provided dollar and euro letters of credit to several companies and had previously denied that foreign banks were unable to do business with it.
Kabir hopes the crisis will be resolved by restoring the governorate through UN-backed talks between Libya’s eastern House of Representatives and the Higher State Council (HSC) in Tripoli in the west.
He said he has been in contact with parliament and the Homeland Security Committee but has had no contact with Menfi or Prime Minister Abdulhamid Dbeibah.
Both the congress and the HSC opposed Menfi’s dismissal of Kabir, saying it violated the internationally backed 2015 agreement that is the legal basis of Libyan politics.
The UN-backed talks aim to establish a mechanism for appointing and managing the central bank governor during a short-term transition period.
He said, “Based on contacts with Parliament and the High Council of State, both parties insist on the implementation of the applicable legal and political agreements. This means that the return of the Governor-General is inevitable.”
Analysts say that while both parliament and the HSC oppose Menfi’s sacking of Kabir, the two institutions have been at odds with hostile forces for the past decade and may struggle to agree on a long-term solution.
