GNU: Reforming fuel subsidy and combatting illegal smuggling

After the PM's announcement to possibly reform the country's fuel subsidy system, the committee tasked with the monumental job held their first meeting this week

BY Libyan Express Mar 29, 2021 - 22:40 Updated: Mar 29, 2021 - 22:41

The goal of reforming fuel subsiding is to boost the country’s economy and giving the dinar back some of its lost value. [Photo: GNU]

Libya’s Prime Minister Abdul Hamid Debaiba recently issued a decision to create a Ministerial Committee to study the possible withdrawal of fuel subsidy by the government in an attempt to reform it and boost the country’s struggling economy.

The committee will be chaired by the newly sworn-in Minister of Economy with the help of both Ministers of Finance and the Minister of State Economic Affairs.

The controversial announcement will mean that instead of the government subsiding fuel to the citizens, they will instead receive a direct cash grant into their bank account to obtain it instead.

The committee to reform the country’s subsidies is apart of the GNU’s promised overhaul of the country’s economy in an attempt to boost it and bring an end to the corruption that runs rampant in the country’s subsidy system.

Withdrawing fuel subsidy will also result in the nationally desired outcome of increased dinar value against foreign currencies, with the hope that in the months to come with successful subsidy reform, the dinar will reach the price of 3 dollars if not less, finally bringing an end to the dominance of the black market on the country’s currency exchange market.

Reforming fuel subsidy will also strengthen the state against illegal fuel smuggling if not bring it to an end altogether.

Subsidy reform committee holding its first meeting in Tripoli. [Photo: GNU]

Shortly after the announcement was made, the reform committee held its first meeting to discuss the best possible alternative to fuel subsidy and the arrangements needed to carry out a successful transition from subsiding fuel to other alternatives.

The head of the committee and minister of finance affirmed that the committee’s goal is to find the most optimal solution in the best interest of the Libyan people to improve their quality of life and give the country’s economy a much-needed boost.

Despite the possible long term benefits of subsidy reform, Libyans have taken to social media to object to the decision, calling it a mistake and a crime against the citizens who are barely able to afford fuel as is.

With summer inching closer and with it the country’s notoriously long electricity cuts which mean more generators and more fuel in need, reforming gas subsidy could be the GNU’s greatest victory or downfall depending on the outcome for the average citizen that continues to struggle to meet his needs in the face of a crumbling economy and acute lack of basic services.

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