By Libya Herald staff.
Tripoli, 15 January 2015:
Saudi currency dealers in Mecca are reported to be refusing to accept the Libyan dinar because of the political . . .[restrict]situation in Libya. They say that it remains uncertain and the oil-rich country’s economy hangs in a balance.
When the current conflict in Tripoli started in July, the Libyan dinar was worth 77 US cents. By December, the rate had dropped to 60 cents. As of today, 15 January, its had plummeted to 57 cents.
While the value of a number of Middle Eastern and Asian currencies fluctuated during the final months of 2014 due to a drop in oil prices and unstable political situations, the Libyan dinar has suffered more than most of the others, driving exchange dealers in Saudi Arabia to require Libyan pilgrims to convert their currency into dollars before entering the country.
Those traveling to Mecca from Yemen, Sudan, Syria and Iraq are also being required to change their currencies first to dollars, causing the demand for dollars inside those countries to soar.
In Sudan, for example, the demand for dollars has become so great that the government is now requiring that anyone who wishes to change Sudanese pounds into dollars must present a copy of his flight reservation at the bank for a maximum of $1,000, a pharmacist living in Sudan told the Libya Herald.
The anticipated result of this drop in the Libyan dinar’s worth and the international community’s unwillingness to accept it, should the trend continue, is that there will be a race to snatch up dollars inside Libya and it will become increasingly more expensive for Libyans to travel abroad. Meanwhile, foreigners who are paid in dinars, such as health care and construction workers, will stop coming in search of employment.
It was reported that when Filipino workers repatriated in August of last year, some banks refused to exchange the dinars they had brought back to their families for Philippine pesos, rendering their salaries earned in Libya effectively worthless. [/restrict]