Publication

This publication examines Libya’s looming banking crisis, including how it could exacerbate deadly fighting in Tripoli, ignite a resource war and deepen the country’s east-west divide. Key insights include 1) that the crisis is a consequence of a four-year split between the Central Bank in Tripoli and its eastern branch, dating from the broader political divide in 2014; 2) should the Central Bank freeze the operations of two key commercial banks because of falling reserves, the move could destabilize the east-based government and interrupt funding for Haftar-led forces, deepening the country’s political divide; 3) a way out requires a ceasefire in Tripoli and an end to the four-year split between the Central Bank’s rival branches, and more.