The Maltese government has seized more than $1 billion of “counterfeit” Libyan currency that was printed by the Russian state-owned company Goznak, stated the U.S State Department on its website.
The seizure of a batch of Libyan dinars, which is worth $1.1 billion, was carried out on May 26, the statement said, in terms of the U.S. currency.
“$1.1 billion of counterfeit Libyan currency printed by Joint Stock Company Goznak—a Russian state-owned company—and ordered by an illegitimate parallel entity”, the State Department said. “The Central Bank of Libya headquartered in Tripoli is Libya’s only legitimate central bank,” the State Department said in a statement.
The State Department also noted that “influx of counterfeit, Russian-printed Libyan currency in recent years has exacerbated Libya’s economic challenges.” Washington reaffirmed its determination to work with the UN and international partners to curb activities that ” that undermine Libya’s sovereignty and stability” of Libya.
” This incident once again highlights the need for Russia to cease its malign and destabilizing actions in Libya.,” the State Department said.
Russia prints currency for other countries. Goznak’s website says that the company produces banknotes for central banks and national banks of other countries.
Moscow has been printing currency for Libya since 2016, and it is destined for a Libyan parallel government led by its de facto leader, Libyan National Army Marshal Khalifa Haftar. There are central banks in both parts of Libya, and the currency that Goznak prints for the Haftar administration is slightly different from the dinars that the British company De La Rue prints for the official government.
In October 2019, Reuters reported, citing Russian customs data, that Russia had increased the supply of new printed Libyan banknotes to the east of the country. Thus, from February to June, Russia sent almost 4.5 billion dinars ($3.22 billion at the rate for that period) in four batches.
Russian customs statistics show that in 2018 Russia delivered 151.8 tons of banknotes to Libya, and in 2019 – 272.4 tons in total, according to the Russian customs, in 2016-2019 Russia delivered a total of almost 843 tons of banknotes to Libya. Based on the average ratio of 16 million Libyan dinars per tonne of banknotes, according to Reuters, Russia has delivered at least 13.5 billion dinars, or $9.5 billion at the current rate, since 2016.
This is the second time Malta has seized Libyan currency. In November 2019, reports emerged that Maltese authorities had seized containers with “unofficial” Libyan banknotes believed to be coming from Russia, the Guardian reported.
Malta argues that this has nothing to do with international politics, but only a legal issue. Malta recognizes only the government in Tripoli.
Libya continues a civil war that began after the overthrow and assassination of Muammar Gaddafi in 2011. Two political centers have been established in the country: the Government of National Accord, headed by Fayez al-Sarraj, and the eastern Government, led by Prime Minister Abdullah Abdulrahman al-Thani who is supported by Field Marshal Khalifa Haftar.