Libya’s Government of National Unity will end to the country’s decades-long fuel subsidy program before end of this year, said Prime Minister Abdul Hamid Dbeibeh on Saturday.
Dbeibeh first announced his decision to scrap fuel subsidy last month, describing his decision as “irrevocable”.
At that time, the announcement sparked a wide public outcry. It instantly drew criticism from the Libyan public across social media, with the majority of Libyans slamming the prime minister’s lack of alternative plans to fuel subsidy program such as setting up a system of public transportation or enforcing security across the country’s border to tackle fuel smuggling.
Libyan households’ direct benefits from energy subsidies are close to 2.5 billion LYD, according the World Bank. In a 2015 report, the World Bank noted that, while elimination of energy subsidies would create direct savings of 2.5 billion LYD to the government budget, it will increase poverty by 17.7 percentage points, resulting in a post- reform poverty rate of over 36%.
Ali Al-Takali, a member of Libya’s House of Representatives, expects that the parliament will not approve the decision to end energy subsidies before “studying its negatives and repercussions,” noting that there are several steps that must precede this decision and its implementation.”
Speaking to news website Bawabat Al-Wasat on Thursday, Al-Takali considered the decision to “amounts to holding the citizen responsible for the government’s failure to address the fuel smuggling crisis”.
Al-Takali accused Dbeibeh’s government of attempting to “cover the financial deficit that resulted from rampant corruption and ill-considered spending.”