(Bloomberg) — The governor and board of Libya’s central bank defied calls from ruling authorities to resign on Tuesday, setting the stage for a clash that could deepen the political crisis in the OPEC country.
The regulator’s officials said in a statement on the bank’s Facebook page that the Presidential Council, which made the decision to replace them, did not have the legitimate authority to replace Governor Sadiq Al-Kabir and the board members. The statement said the bank’s position had been explained to a delegation sent to enforce the order.
The refusal to step down threatens to increase tensions in a North African country divided between rival governments in the west and east that has seen little peace or stability since the overthrow of longtime leader Muammar Gaddafi in 2011. The Presidential Council serves as Libya’s head of state and military commander.
The dispute over Al-Kabir is just one of many power struggles in the country, which has Africa’s largest proven oil reserves, and comes after the eastern parliament said last week it was withdrawing from a fragile 2020 ceasefire agreement that was supposed to end violence in the country and pave the way for elections.
Read: Libya’s power struggle escalates as central bank gets drawn into dispute
Al-Kabir, who has headed the central bank since October 2011, has faced increasing criticism over his management of oil revenues and the state budget. At the same time, he has amassed considerable influence and enjoys the support of the legislature and government in the east, as well as the United Nations and western countries. The regulator is the only recognized repository for billions of dollars in oil revenues.
“We would like to reassure our people in Libya and regional and international parties that the central bank and the banking sector are carrying out their work as usual,” Al-Kabir said in the statement on Tuesday.
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