Exclusive: “Munther Al-Shahoumi” to Sada: The Libyan economy shows truth and illusion

The director of investment funds, Munther Al-Shahoumi, spoke exclusively to Sada Al-Eqtisadiah newspaper, where he said: Libya faces many economic challenges that reflect the depth of the financial crisis it is experiencing, as these challenges are manifested in the increase in the size of the support and salary bill, such as the Ministry of Foreign Affairs, the closure of the real estate registry, and the lack of creditworthiness. For more than 70% of the country’s real estate wealth, in addition to this, there is a lack of commercial and investment planning by successive governments to diversify the economy, support the private sector, and increase the smuggling of goods, especially subsidized goods, in addition to the increase in the costs of electricity production and what is allocated to the electricity company, which constitutes a heavy burden on State resources and highlights the randomness of expenditure and the lack of a financial sustainability system, especially in light of expectations of a decline in oil prices as a result of expectations of a global recession in the coming years.

Adding: The increase in the size of the support and salaries bill. The increase in the support and salaries bill indicates continued pressure on the state’s general budget, as this bill constitutes a large percentage of government spending without obtaining tangible returns that strengthen the national economy.

Regarding the closure of the real estate registry, Al-Shahoumi said: Closing the real estate registry since 2011 led to the disruption of the real estate market and rendered more than 70% of real estate in Libya without credit value, which hinders the possibility of exploiting this wealth to stimulate economic and development activity.

He also said: The lack of investment and commercial planning by successive governments means a failure to diversify sources of national income and excessive reliance on oil as a main source of income, which makes the Libyan economy vulnerable to global market fluctuations.

He added, speaking: The increase in smuggling of goods, especially subsidized goods, leads to a waste of state resources and undermines economic development efforts, and contributes to the continued budget deficit and an increase in the costs of electricity production and what is allocated to the electricity company, which leads to an exacerbation of the financial burden on the state and reflects a lack of efficiency and effectiveness in energy management. , which puts Libya in a difficult position to meet the growing energy demand without resorting to large investments in energy infrastructure.

According to Al-Shahoumi, the randomness in government spending and the lack of a financial sustainability system leads to a significant depletion of state resources, especially in light of the expected decline in oil prices as a result of expectations of a global recession in the coming years. This makes it necessary to re-evaluate spending mechanisms and rationalize the use of resources to ensure Financial and economic stability of Libya.

Al-Shahoumi concluded by speaking about the recommendations, saying: In order to confront these challenges, Libya must focus on several basic points: –

1. Reopening the real estate registry and regulating the real estate market: to exploit real estate wealth to stimulate economic activity and development.
2. Diversifying the economy: by developing alternative sectors such as tourism, agriculture, transit trade, and manufacturing industries to reduce dependence on oil.
3. Controlling the support and salary bill: by restructuring the support system and rationalizing government spending to achieve financial sustainability.
4. Improving the efficiency of electricity production and energy management: through long-term investments in infrastructure and new and renewable energy technologies.
5. Combating smuggling: by strengthening border control and international cooperation to reduce the smuggling of goods and resources.
   6. Rationalizing the spending of the Ministry of Foreign Affairs and reviewing the viability of diplomatic missions around the world and rationalizing their spending.

By adopting these recommendations, Libya can take important steps towards achieving long-term economic stability that serves all citizens.

You can also read the news in the source from the Sada Economic newspaper