The Central Bank of Libya (CBL) has said it is doubling the proportion of hard currency set aside in its annual budget for the import of five broad categories of goods through letters of credit (L/Cs)

The bank says that the allocation for L/Cs for industrial goods, telecommunications, aviation, children's milk and medicines will increase from 5 to 10 per cent.

CBL circulars

In a July circular, CBL updated an earlier one confirming the prioritisation of the opening of hard currency L/Cs for the five goods categories.

Importers will be able to use three different local banks to open their L/Cs for these goods.

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They will also be able to use money from their existing bank balances as part of the 130 per cent cover required for an L/C opening.

Increased L/C availability will be welcomed by Libyan consumers and importers alike since the shortage of foreign currency - due to decreased state oil revenues and widespread use of black market exchange rates three times higher than the official one - has sent prices and inflation sky-high.

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