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Russian coins for Libya
By Richard Giedroyc
November 30, 2017

The Central Bank of Libya has a problem. There are two Central Banks of Libya, one in Tripoli and another in Bayda.

The CBL also has locations in Sabha and Sirte, but these are branch locations loyal to the Tripoli-based organization. CBL Governor Farhat Bengdara resigned from that office in March 2011, then defected to the other side in Bayda during the Libyan Civil War. He had good reason to defect. He froze most of Libya’s external assets, denying them to the regime of Libya’s since-deceased dictator Muammar Gaddafi. Kassem Azzuz replaced Bengdara as the CBL Governor in Tripoli.

The Bengdara-led CBL has since been circulating bank notes in the eastern half of the country that were printed in Russia. Now the Benghazi government has announced it will issue new 1-dinar coins to replace the worn-out bank notes of the same value. The coins were shipped through Benghazi to Bayda, being among the first shipments of anything into Benghazi, which had been closed for three years due to the ongoing civil war.

On Oct. 20 Reuters news service described the new coins as “copper colored, weigh slightly more than a 2-euro coin or a new British pound and feature a picture of a plant native to eastern Libya’s Green Mountains, with the words ‘Central Bank of Libya.’”

The coin has an official exchange rate of about 75 cents US, but will actually trade at less than 12 cents on the black market. The coins were to become legal tender officially on Nov. 2.

The banks in both Tripoli and in Bayda claim to be acting neutral. However, Tripoli has criticized the Bayda-based bank in the east for previously having Libya bank notes printed in Russia. According to the Oct. 19 Libya Herald newspaper, “The CBL in Tripoli, after first rejecting these notes, later relented. It is not yet clear how they will react to the new coin.”

The same newspaper article reported, “The majority of 1-dinar bank notes in circulation in the east of the country is now dirty and tattered and often stuck together with transparent tape.”

According to the most recent issue of MRI Bankers’ Guide to Foreign Currency, the Russian version of the Libya 20- and 50-dinar bank notes have “straight serial numbers” while the British version have “ascending serial numbers.” De La Rue likely printed the British notes, but that wasn’t confirmed at the time this article was being written. Two varieties of the 10-dinar bank note are in circulation, De La Rue having printed the variety with the central bank name in initial capitals, while a version with the name in all capital letters was printed by Oberthur Technologies in France. The French variety adds a crescent and star symbol to the holograph security patch and is dated 17.02.2011 (Feb. 17, 2011), the date of the Libyan revolution and civil war.

Neither central bank would acknowledge how many 1-dinar coins had been received, but it is known that Russia has supplied eastern Libya with 4 billion Libya dinars value in bank notes since May 2016.

Russia has not supplied Libya with any of the 1-dinar bank notes. The note being overridden by the coin is dated Feb. 17, 2013, and commemorates the second anniversary of the revolution. A vignette of a cheering group with a flag appears on the front, with a flag and doves on the reverse. Libya also uses 2-, 5-, 10- and 50-dinar bank notes. Coins were issued in 2013 and 2014 in denominations of 1/4 and 1/2 dinar, and 50 and 100 dirham.

The Oct. 20 Reuters news report gave this bleak outlook for Libya: “Libya’s economy has deteriorated rapidly in recent years as conflict and anarchy have hit oil exports that provide nearly all its income. People queue at banks to get bank notes which are in short supply while living standards plummet and prices surge.”

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