New Smart Cards to Cut Fuel Subsidies

Reuters reports that Libya plans to introduce a smart card system to limit the costly subsidies its citizens enjoy when buying motor fuel -- much of the fuel is smuggled into Tunisia for resale at higher prices.

Under the new system, citizens will be able to buy a limited amount of subsidised fuel, and will have to pay a normal, market price for any extra quantities.

What had been a small-scale smuggling trade, involving a few cars loaded with petrol, has grown into an industry run by criminal gangs trucking large quantities across the borders, cabinet spokesman Ahmed Lamin said.

The government expects to save 800 million Libyan dinars ($650 million) annually in subsidy costs by cutting out smuggling, growing to around 1.3 billion dinars ($1,060 million), after putting caps on subsidised consumption.

The introduction of the cards is expected within two to three months.

(Source: Reuters)

(Petrol image via Shutterstock)

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