Dramatic Measures to Plug Budget Deficit

The Central Bank of Libya has proposed cutting the country's diplomatic missions abroad and halting foreign scholarships and other state allowances.

The move is part of a plan to cut the budget deficit, estimated at 25.2 Libyan dinars ($20.9 billion) last year.

A combination of lower oil exports, caused by the continuing conflict in the country, and a dramatic fall in the price of oil, resulted in revenues down 63 percent in 2014, from a budget figure of 57 billion Libyan dinars to just 20.9 billion.

The central bank said in a statement:

"The central bank calls on all concerned parties to cooperate in dealing with the growing crisis and alert the public about the dangers facing the country in order to restore stability and protect Libya's future."

According to Reuters, the country's foreign currency reserves were estimated at $109 billion at the end of June.

(Sources: Central Bank, Reuters)

(Budget image via Shutterstock)

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