Meat in Libya is not for everyone amid declining purchasing power

In a shopping center in the center of the Libyan capital, Tripoli, some customers compare the prices of vegetable oil and pastries, while others content themselves with looking at meat types without buying them, due to their high price in a country where the purchasing power of citizens has collapsed due to the decline in the value of the currency and the delay in salaries, despite the revenues from its oil wealth.

Economic analyst Abu Bakr Al-Tur said, “Libya is going through critical days and a period of time with rising prices and rising exchange rates, which has greatly affected the savings of the citizen who is sometimes unable to buy his basic needs, especially since we are approaching the month of Ramadan.”

He added, “In fact, the situation is miserable regarding the capabilities of citizens of all classes.”

The baskets are no longer as full as they were a few months ago after families began to limit their spending despite the approaching month of Ramadan, which begins early next week and usually witnesses an increase in consumption and commercial activity.

Chaos and two governments

The main reason for the decline in purchasing power is the rise in prices of consumer goods heavily imported into Libya due to the decline in the value of the Libyan dinar from five dinars per dollar in the parallel market to 7.5 dinars per dollar (officially 4.8 dinars).

Libya is struggling to recover from the chaos caused by the fall of the regime of the late President Muammar Gaddafi in 2011 in the wake of a popular revolution supported by NATO, while the country is divided between two competing camps based to the west in Tripoli and to the east in Benghazi, with two parallel governments.

The head of the government recognized by the United Nations, Abdul Hamid Dabaiba, confirmed during a ministerial meeting, “We share the concern of the Libyans, and this concern that we live with them and we strive to remove its effects is represented by the rise in the exchange rate and the dollar in the parallel market, the high cost of living and the increase in prices caused by speculation in The market, and exploiting people’s needs as the holy month approaches.”

“Central” decisions

In fact, the decline in the value of the dinar in the parallel market and the lack of liquidity in banks are largely due to the decisions of the Central Bank of Libya, according to experts, as it imposes restrictions on opening credits for the purpose of importing (the only legal means for an importer wishing to buy and transfer hard currency outside the country), and this is limited Importing medicines and foodstuffs.

This situation pushes importers of other products, such as cars, equipment, and clothing, for example, to go to the parallel market to obtain foreign currency.

The Central Bank also sharply reduced the ceiling for purchasing foreign currencies at the official rate from $10,000 to $4,000 per person annually.

The purchasing power of families has also declined due to the rise in prices of basic consumer foodstuffs such as pasta, rice, sugar, and flour, which were previously highly subsidized, and are now hostage to the dollar level in the parallel market.

State revenues and expenditures

Libya has the largest oil reserves on the continent, and its net revenues amount to about $20 billion annually from oil and gas exports, representing about 95 percent of the state’s revenues.

More than half of this money is allocated to finance the salaries of 2.3 million government sector employees in a country with a population of 7 million people, according to official data, and the rest of the oil revenues must also cover the needs of the two parallel executive authorities, including the eastern region under the control of Field Marshal Khalifa Haftar.

The payment of salaries and pensions to retirees has been delayed for several months recently, and Ahmed Al-Warfalli (65 years old) says, “Retirees in general are suffering, as the value of their salaries has decreased compared to the previous period.”

While he was waiting for his wife, who was buying some supplies in a shopping center in the capital, Tripoli, he added, “The retired employee suffers waiting for his retirement salary to be disbursed and the possibility of withdrawing it from the bank, and this is a source of fatigue, especially in the current period in which the situation has become severe.”

Muhammad Al-Wahishi (29 years old), who works for himself, said, “They say that the prices of meat and poultry are affordable for everyone, and this is not true,” adding, “A hard-working citizen who has an income of 700 dinars can only buy what is sufficient for his daily living, and soon we will have to To give up all types of meat.”