IMF urges Libya to agree on unified budget for 2025

The International Monetary Fund has urged Libyan authorities to prioritize spending through an approved and unified 2025 budget to prevent pro-cyclical expenditure and enhance resource management.
The IMF announced on December 10 that Libya’s recovery in oil production has led to an upward revision of the country’s GDP growth forecast for 2025. In its report following a delegation’s visit to Libya, the IMF projected an increase in GDP growth for the upcoming year. However, it cautioned that medium-term growth remains relatively stable, with a decline in GDP growth and the external balance anticipated in 2024.

The IMF warned that these projections are subject to downside risks, including lower-than-expected oil prices and renewed political instability, which could constrain fiscal resources.

The international financial institution urged authorities to prioritize spending through an approved and unified 2025 budget to prevent pro-cyclical expenditure and enhance resource management.

Additionally, the IMF reiterated its support for the initiatives of the Central Bank of Libya to improve access to foreign currency and address local currency shortages by injecting liquidity into the banking system and expanding electronic payment services. The report commended ongoing efforts to strengthen banking sector governance, tackle money laundering and terrorist financing, enhance data collection, and foster innovation in financial technology.

The IMF also emphasized its commitment to capacity-building in key areas, including tax policy, budget preparation, revenue management, consumer price index development, reserve management, and monetary policy, to support Libya’s broader economic stability and development.