WASHINGTON, December 17, 2025 - Libya's economy rebounded strongly in the first nine months of 2025, led by a recovery and expansion in the oil sector, according to the latest World Bank Libya Economic Monitor. However, this growth will require continued reforms to strengthen transparency, accountability, and the delivery of public services.
Real GDP is projected to grow by 13.3 percent in 2025, supported by a 17.4 percent surge in oil sector activity, while non-oil GDP is expected to grow by 6.8 percent amid resilient private and public consumption. Oil production averaged 1.3 million barrels per day-an increase from 1.1 million barrels per day in 2024-after earlier disruptions linked to the Central Bank of Libya leadership dispute. This rebound was supported by increased investments, ongoing maintenance in oil projects, and gradual security improvements. Nevertheless, Libya continues to face significant structural, security, and political challenges that weigh on its longer-term economic prospects.
Public finances have improved notably, with the Government of National Unity recording a fiscal surplus of 3.6 percent of GDP in the first nine months of 2025, up from 0.7 percent a year earlier. Despite softer global oil prices, hydrocarbon revenues rose by 33 percent-fueled by higher output and the April 2024 devaluation of the Libyan dinar-offsetting lower tax revenues.
"The rebound in oil production has lifted growth and improved the fiscal position in 2025. Sustaining this progress will require tackling structural constraints and advancing reforms to strengthen transparency, accountability, and service delivery," said Ahmadou Moustapha Ndiaye, World Bank Division Director for the Maghreb and Malta.
The outlook for the rest of 2025 appears broadly positive, provided security conditions remain stable. However, ongoing domestic political dynamics and institutional complexities pose challenges for consistent macro-fiscal management.
The report's Special Focus chapter assesses Libya's public financial management system. The analysis highlights how institutional fragmentation, parallel budget structures, and heavy reliance on oil revenues have weakened fiscal discipline and service delivery, making planning and execution vulnerable to external shocks. Libya lags behind other fragile and conflict-affected states in budget preparation, execution, and reporting; however, international experience shows that targeted reforms can deliver results even in challenging contexts. Policy recommendations include establishing a Treasury Single Account, strengthening cash management, and revising budget classification to improve transparency and control.
