In conflict riven Libya, the Tripoli-based authorities have passed a decree banning imports of 32 items on letter of credit (L/C) terms for 6 months.

The L/C import ban has been unilaterally imposed by the Tripoli-based authorities and not by the internationally recognised government in eastern Libya.

Selective ban

Officials at the Tripoli authority's Ministry of Economy circulated the decree to the Tripoli-based Central Bank of Libya, the Customs Authority, the Chamber of Commerce and the Business Council.

The authorities assured that the ban would not apply to raw materials for local industry and consumption, foodstuffs or other essential items.

Depleting reserves

The move to freeze selected L/C transactions is seen as part of the Tripoli authority's efforts to stem the depletion of Libya's foreign currency reserves and control the outflow of the country's hard currency through fake or overvalued invoices.

The L/C ban is said to be temporary and is due to be lifted in early November.

With Islamist and nationalist forces in a state of severe conflict, Libya has been forced recently into topping up its currency reserves by dipping into reserves accumulated by the ousted Qaddafi regime over several decades.

This article represents the views of the author and not necessarily those of the ICC or any of the other partners in DC-PRO.