UNITED NATIONS — The United Nations is pressing Libya’s rival leaders, in renewed talks this month, to pair its election roadmap with an economic-track blueprint meant to stabilize public finances and unify key institutions. The effort is driven by warnings that the Libya conflict is being prolonged by opaque spending and a fiscal deficit that may have exceeded $10.4 billion in 2024, Dec. 27, 2025.
Hanna Serwaa Tetteh, the U.N. special representative for Libya and head of the U.N. Support Mission in Libya, told the Security Council that the “complications” blocking long-delayed elections can be overcome, according to a U.N. political affairs account of the Dec. 19 briefing. In October, she warned that “Libya cannot afford continued delays or disruptions” as political institutions failed to close gaps over election laws and key appointments, according to a U.N. Geneva readout.
Libya conflict: economic pressures raise the cost of delay
Diplomats and economists say the Libya conflict is no longer just a question of ballots and security arrangements. It is also about who controls spending, how oil revenues are shared, and whether the country’s financial institutions can operate as one system across rival administrations.
On paper, the macro picture looks stronger than it did during past oil shutdowns. A World Bank assessment released this month projected real GDP growth of 13.3 percent in 2025, led by a rebound in the oil sector, and said production averaged 1.3 million barrels per day in the first nine months of the year. But the report also argued that sustaining gains requires structural reforms to improve transparency and public financial management, especially as competition over state resources remains at the center of the Libya conflict.
Liquidity stress remains a daily reality for many households. The Central Bank of Libya said it authorized the printing of 60 billion Libyan dinars, about $11 billion, to ease cash shortages, with additional shipments expected into 2026, Reuters reported in October. For the Libya conflict, critics say such steps may help in the short term but do not resolve the underlying dispute over budgeting, oversight and who ultimately controls the levers of public spending.
What the economic-track blueprint would prioritize
A December policy paper from Chatham House put a number on the risk. It estimated Libya’s “true fiscal deficit” in 2024 may have exceeded $10.4 billion — more than 22 percent of GDP — if expenditures not captured in official data are included. The paper argues the Libya conflict will remain stuck unless economic governance reforms are integrated into political negotiations and backed by coordinated technical support, outlined in a five-area blueprint for an enhanced economic track.
Framed as an economic track that runs alongside the political roadmap, the blueprint prioritizes:
Immediate stabilization: transparency rules for spending and revenue, plus work toward a unified state budget.
Structural reform: moving beyond ad hoc bargains toward a structured program that reduces incentives for rent-seeking.
Capacity building: aligning outside support with Libyan institutions tasked to implement reforms.
Anti-corruption enforcement: strengthening oversight bodies and disrupting illicit financing networks that benefit from fragmentation.
Public inclusion: widening talks beyond elite bargaining so the process reflects citizen priorities and restores legitimacy.
Continuity check: the Libya conflict’s cycle
The U.N. and foreign capitals have tried to fuse politics, security and economics before. The Berlin conference conclusions in January 2020 called for a comprehensive approach under U.N. auspices, including follow-up mechanisms. In October 2020, Libyan rivals signed a permanent ceasefire that envoys said should create space for political talks and an economic track, Reuters reported.
But the elections planned for December 2021 collapsed amid disputes over the legal framework and candidate eligibility, Reuters reported at the time, and institutional rivalry hardened again. Diplomats say the lesson for the Libya conflict is that election timelines remain fragile when state finances are treated as spoils and oversight is weak.
International officials now say the political roadmap and the economic track have to move together. Without credible oversight of spending and a unified approach to budgeting and revenue distribution, the Libya conflict risks repeating its “no war, no peace” status quo, even if large-scale fighting stays contained.
