Letter of credit (L/C) openings and foreign exchange (FX) sales to both public and private sectors in Libya are proceeding normally according to the Central Bank of Libya's (CBL's) governor, Naji Issa.

The central banker conveyed this assurance during a roundtable discussion hosted by the US-Libyan Business Association (USLBA) in Washington, with the aim of bolstering investor confidence and highlighting Libya's commitment to facilitating international trade.

Low oil revenues

Despite these reassurances, Libya's broader economic context presents challenges. In March 2025, the CBL reported that FX sales amounted to US$2.3 billion, while oil revenues - the primary source of foreign currency - were only US$778 million.

This discrepancy underscores the pressure on Libya's foreign reserves and the need for prudent fiscal management.

L/C caps

To address these issues, the CBL has implemented measures such as capping commercial L/Cs at US$3 million and industrial import L/Cs at US$5 million. Additionally, the official exchange rate was adjusted to 5.5677 Libyan dinar to one US dollar in early April 2025.

The CBL's engagement with international institutions, including the International Monetary Fund (IMF), reflects its efforts to stabilise the economy. Discussions with the IMF have focused on economic reforms, unifying the national budget, and strengthening the Libyan dinar against foreign currencies.

Evolving economic environment

While the CBL's statements and initiatives indicate a commitment to maintaining normal L/C operations, the sustainability of these measures depends on various factors, including political stability, effective governance, and continued economic reforms.

Businesses engaging in trade with Libya should remain informed about the evolving economic landscape and regulatory environment.​

This article represents the views of the author and not necessarily those of the ICC or Coastline Solutions.