Maiteeg agreed that government unity was key to unlocking the problem. “People need to see the national unity government working, they need to see more political stability and to feel safe. In the capital [Tripoli] some people are afraid and fear that it is still dangerous. Some of them are feeling that the bank is not safe enough for their money.”
Another problem in Libya has been exchange rate. The country has two exchange rates. One is the official one from the central bank and the other from the 'black market' which is four times as high. Now the government is looking at ways to bring the official and unofficial exchange rates closer together, so that more money goes through the banking system.
“We have built a committee with the central bank and economic experts and they have started to look at how to change the exchange rate to build up secure models between the people and the banks,” said Maiteeg.
Maiteeg added: “A successful strategy means working together. We need enough cash in the banks, we need a standard letter of credit starting straight away and, very importantly, we need to start to build the confidence between businesses and savers and the banks to encourage deposits. Once these three things are done together, the exchange rate will not only improve but the demand for foreign currency will go down too.”
Adam can be contacted at adam@libya-businessnews.com and +44 7900 783662.