Energy Subsidy Reform in Libya

Summary

Energy subsidies have become a significant burden on government finances in Libya. The pervasive nature of subsidies has led to rampant corruption, smuggling, and a diversion of resources from essential public services. The paper identifies key barriers to reform, including opposition from vested interest groups and public apprehension regarding inflation and welfare loss. To address these challenges, a strategic reform plan is proposed, emphasizing a phased approach, a comprehensive communication plan and social protection measures to mitigate the adverse effects of subsidy removal. By taking these steps, Libya can transition towards a more sustainable framework that supports macroeconomic stability.

Subject: Anti-smuggling, Commodities, Consumption, Electricity, Energy subsidies, Expenditure, Fuel prices, Gasoline, Imports, Inflation, International trade, National accounts, Oil, Price adjustments, Prices, Revenue administration

Keywords: Anti-smuggling, Collection System, Communication, Consumption, Diesel, Electricity, Electricity, Energy subsidies, Energy Subsidies, Fuel prices, Fuel Prices, Gasoline, Gasoline, Gradual Phasing, Imports, Inflation, Libya, Mitigation Plan, Natural gas sector, Oil, Oil, Price adjustments, Smuggling, Subsidy Reform, Tariffs