A former rebel fighters is seen through a pre-Gadhafi flag as he celebrates prior to heading to the frontline in Bani Walid, 2011. -

Last updated: 3 hours ago

Libya

Libya's rival eastern and western legislative bodies have signed a US-mediated agreement to unify public spending across the divided country for the first time in over a decade, the central bank said Saturday.

The north African country has struggled to recover from the chaos that erupted following the 2011 Arab Spring uprising that toppled longtime ruler Muammar Gaddafi.

It remains divided between a UN-recognised government led by Prime Minister Abdulhamid Dbeibah based in Tripoli and an eastern administration in Benghazi backed by military leader Khalifa Haftar.

"This step reflects real progress toward unifying fiscal policy and strengthening the good management of public spending," the central bank said of the new budget, calling the agreement "the first consensus on unified spending across Libya in over 13 years".

The agreement was signed by Issa Al-Arebi, a representative of the Benghazi-based House of Representatives, and Abdul Jalil Al-Shawish, a representative of the High Council of State in Tripoli. Despite generating $22 billion in oil revenues last year - up more than 15 percent compared to the year before-- Libya faces a foreign currency deficit of $9 billion, according to the central bank.

Last January, the bank devalued the dinar by nearly 15 percent for the second time in less than a year, citing a host of issues including the lack of a unified state budget.

The central bank said the new agreement would bolster financial stability in the country, commending the "positive role of the United States in supporting mediation efforts" between the two sides.

Libya holds Africa's largest oil reserves at around 48.4 billion barrels, and currently produces about 1.5 million barrels per day while seeking to increase output to two million.

Dbeibah also thanked Trump's senior adviser on Arab and African affairs Massad Boulos for "supporting the mediation efforts that led to this agreement".

"This is a step that carries promising signs, but the true test remains the serious commitment of all parties, so that it translates into tangible results for citizens in their daily lives," Dbeibah wrote in a statement.

Libya to have first unified budget in 13 years

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