HoR passes 2022 Bashagha government budget of LD 89.6 billion

government - June 17, 2022

At its session in Sirte yesterday, Libya’s parliament, the House of Representatives (HoR), unanimously approved the 2022 budget presented by the Fathi Bashagha government.

The budget totalled 89,689,376,000 Libyan dinars, less than the HoR recognized Libyan government led by Fathi Bashagha had asked for.

According to the HoR’s Official Spokesperson, Abdalla Belheeg, the unanimously approved budget received 103 votes, with 98 votes present at the session and 5 members reportedly voting electronically. This still leaves the total 17 short for the 120 votes widely perceived as the necessary quorum.

Bashagha does not get his requested LD 94 billion
It will be recalled that Fathi Bashagha’s government, had referred the 2022 draft budget to parliament in May totalling 94,830,515,200 Libyan dinars.

Analysis
The passing of the Fathi Bashagha government’s 2022 budget by the HoR puts several domestic and international stakeholders in a predicament.

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Increased domestic tensions?
The approval of the Fathi Bashagha budget could further increase tensions within the polarised Libyan political scene.

Firstly, it puts the Abd Alhamid Aldabaiba and his Tripoli-based government in a quandary. They must decide if they want to continue with the narrative that their government was selected by the Geneva Libyan Political Dialogue Forum (LPDF) which prescribed that they are only to hand over power to an elected government – which has not happened.

Relatively, the Aldabaiba government had lost further legitimacy with the selection of the Bashagha government and now even more with the approval of the Bashagha budget. The HoR had refused to pass Aldabaiba’s budget and instead voted him out of office.

The passing of the Bashagha budget also puts the spotlight on the Tripoli Central Bank of Libya (CBL) and the Tripoli-based Audit Bureau. These two self-appointed guardians of Libya’s finances must decide if they are to reject the Fathi Bashagha budget approved by the country’s parliament.

If they do, there would be a case to be made that any money they hand out to the Aldabaiba government is illegal. They could turn out to be on the wrong side of the law.

The International community facing a dilemma?
The international community also finds itself in a fix with the approval of the budget. It puts pressure on them to recognize the Bashagha government. For years the international community has been feigning neutrality and insisting they seek a Libyan led Libya-Libya solution. The Fathi Bashagha government is as close as Libya has come to that.

The international community must decide if they want to pursue their own short-term national interests by sticking to whichever governments holds the capital Tripoli or seek a long-term Libyan solution.

Tripoli is where Libya’s political, military and financial power is. Including the Turkish forces on the ground and with Misrata, it is where the most military power is concentrated. It is also, for historical contractual reasons, where Libya’s oil revenues are deposited.

Will the Bashagha government and budget split Libya?
However, if the international community ignore the Bashagha government and openly support the Tripoli-based government, it could enshrine Libya’s political split.

It could encourage eastern Libya to continue the oil blockade and exhaust Libya’s resources. This could lead to further political, financial and military instability.

The CBL is stuck
It is also likely that the Tripoli CBL will ignore the Bashagha budget and continue to refuse to hand over any money to the Bashagha government. It would be very difficult for the CBL to do otherwise. It would be coerced by Tripoli’s militias. The best neutral course the CBL could follow is to just pay wages and subsidies. This would continue Libya’s economic lack of development and keep it closed as an active market for foreign companies and investors.

Without funds, the Bashagha government is a ‘‘paper government’’?
A lack of oil money from the Tripoli CBL would also continue to make the Bashagha government a government that exists on paper only. This is likely again to extend the eastern-imposed oil blockade in order to starve the Tripoli government of new funds.

The passing by the HoR of the Bashagha government has upped the Libyan political stakes. It could increase divisions and herald another period of political and military instability.

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