Feb 1, 2018 - Libyan dinar rapidly appreciated on parallel market. After the parallel market exchange rates peaked in. D
Libya Joint Market Monitoring Initiative (JMMI) February 2018
INTRODUCTION
METHODOLOGY
In an effort to better understand market dynamics in Libya, the Joint Market Monitoring Initiative (JMMI) was initiated by the Libya Cash & Markets Working Group (CMWG) in June 2017. The initiative is guided by the CMWG Markets Taskforce, led by REACH and supported by the CMWG members. It is co-funded by OFDA and UNHCR. Markets in key urban areas across Libya are assessed on a monthly basis. In each location, field teams record prices and availability of basic food and nonfood items (NFI) sold in local shops and markets. This factsheet presents an overview of price ranges and medians for key foods and NFIs in the assessed areas. The cleaned data sets are available on the REACH Resource Centre and distributed to CMWG partners, as well as to the broader humanitarian community. In future rounds, the factsheet will include a Minimum Expenditure Basket (MEB), which represents the minimum culturally adjusted group of items required to support a Libyan household for one month. The prices associated with the MEB will illustrate variations in prices across assessed locations. The MEB will be included once it has been agreed upon by all partners.
Data collection for the JMMI occurs on a monthly basis, with associated factsheets and datasets published and distributed after every round. The ninth round of data collection for the JMMI was conducted between 1 and 8 February 2018, during which enumerators from 5 CMWG partners (ACTED, DRC, Mercy Corps, WFP & REACH) gathered price data for 33 basic items from 305 individual shops in 23 locations. Field staff familiar with the local market conditions identified shops representative of the general price level in their respective location. Assessed shops
ROUND 9 FIGURES 23 assessed cities 305 assessed shops 33 assessed items
EXCHANGE RATES
1
1.328 USD/LYD
5.350 USD/LYD
6.664 EUR/LYD
official
parallel market
parallel market
- 2.0%
- 39.5%
- 37.3%
Libya Cash & Markets Working Group ASSESSED LOCATIONS include supermarkets, bakeries, vegetable sellers and butchers, as well as central markets. At least four prices per assessed item were collected within each location. In line with the purpose of the JMMI, only the price of the cheapest available brand was recorded for each item. Enumerators were trained on methodology and tools by REACH. Data collection was conducted through the KoBo mobile application. Following data collection, REACH compiled and cleaned all partner data, normalising prices and cross-checking outliers.
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Ghadamis ( !
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Al-Jufrah ( !
Ajdabiya
Brak Sabha
Ubari ( !
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Ghat Murzuq Al-Gatroun ( ! ( !
Al-Kufrah
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Northwest Libya Tripoli
ANALYSIS Libyan dinar rapidly appreciated on parallel market After the parallel market exchange rates peaked in December 2017, they fell rapidly in mid-January 2018 (see graph on page 2: Exchange rates over time). The USD/LYD exchange rate briefly fell below the 4 LYD mark, but has rebounded since. As of 4 February 2018, the USD could be obtained for 5.350 LYD on the parallel market – a rate almost 40% lower than in early January. The sudden appreciation of the LYD was most likely linked to the Central Bank of Libya's (CBL) roll out of this year’s family dollar allowance: Each Libyan family is eligible to buy 500 USD at the official exchange rate of roughly 1.350 LYD per USD.2 By early January, the CBL had reportedly paid out 2.8 billion USD to Libyan citizens claiming the allowance.3 This move increased the dollar supply in the parallel market, as many recipients exchanged their family allowances for Libyan dinars, and thus strengthened the Libyan dinar. The recent boost of the Libyan dinar occurred amid promising macroeconomic data, increased oil production and a rising oil price, which has given the CBL more room to grant letters of credit at the official exchange rate to importers.4 This, in turn, decreased the demand for US dollars in the parallel market. Food prices decreased by 14.6% Libya is heavily dependent on food imports. Since many
Al-Bayda ( ! ( ! ( ! Al-Marj Derna !( Tobruk ( ! Sirte Benghazi ( !
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importers are forced to resort to the parallel market to obtain foreign currencies, the recent changes had a significant impact on food prices. Across Libya, food prices fell by 14.6% from January to February. While in the west (–23.5%) and east (–14.1%) food prices have markedly decreased, the exchange rate drop has had a lesser impact on food prices in the south (–4.0%).5 Food prices fell in all assessed locations. The largest price decreases were observed in Zliten (–29.2%), Gharyan (–28.1%) and Ajdabiya (–27.0%). Nearly all monitored food items decreased in price. The price reductions were particularly pronounced for tomatoes (–41.7%), sugar (–35.0%), potatoes (–33.3%) and eggs (–30.4%). NFI prices fell in the east and west, rose in the south Like food items, the vast majority of non-food items are imported. NFIs have thus fallen in price since January (–10.0%). Broken down by region, a decrease was found in the east (–8.9%) and west (–15.4%), while NFI prices rose in the south (+11.9%). Since NFIs are not perishable and are easy to store in large quantities, it is likely that traders have drawn from their stocks rather than relied on recent imports. The exchange rate drop has therefore not yet translated into a substantial reduction in NFI prices across the whole country.
Tarhuna !(Zliten
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Nalut
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Zintan
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Gharyan Bani Walid ( !
ASSESSED ITEMS Food Items Salt Sugar Wheat flour Rice Pasta Couscous Tomato paste Chickpeas Beans Milk Condensed milk Baby milk
Vegetable oil Green tea Black tea Canned tuna Eggs Chicken meat Lamb meat Bread Tomatoes Onions Peppers Potatoes
Non-Food Items Hand washing soap Laundry powder Laundry detergent Shampoo Dishwashing liquid
Toothpaste Toothbrush Sanitary pads Baby diapers
FOOD PRICE INDEX6 Location
NFI PRICE INDEX6
EXCHANGE RATES OVER TIME1
Food Price Index (in LYD)
Change since Jan 2018 (in %)
Change since Oct 2017 (in %)
Location
NFI Price Index (in LYD)
Change since Jan 2018 (in %)
Change since Oct 2017 (in %)
Ubari
110.6
–5.2%
+11.8%
Al-Kufrah
Murzuq
110.0
–7.6%
+4.5%
Tobruk
52.8
–7.7%
+87.9%
44.1
+26.7%
+12.2%
Al-Gatroun
106.8
–2.4%
–1.7%
Ubari
40.9
–10.2%
+1.0%
Ghat
106.5
–5.5%
+20.0%
Brak
40.4
+13.8%
+26.6%
Al-Kufrah
102.5
–3.3%
+17.7%
Al-Gatroun
38.8
+18.2%
–17.7%
Al-Jufrah
88.7
n/a
n/a
Al-Jufrah
38.6
n/a
n/a
Sabha
88.3
–10.2%
+1.2%
Sabha
37.7
–7.8%
+7.1%
Zintan
88.0
–9.9%
+1.0%
Al-Bayda
33.9
–4.6%
+31.6%
Brak
86.8
–9.0%
+13.3%
Al-Marj
31.7
–7.0%
n/a
Ghadamis
86.0
–18.9%
+8.8%
Derna
31.3
+5.0%
+22.0%
Nalut
84.1
–10.0%
–6.6%
Sirte
30.3
–0.6%
–4.6%
Derna
82.8
–16.8%
–9.7%
Benghazi
30.3
–3.6%
+15.0%
Al-Bayda
80.3
–14.8%
+4.2%
Ajdabiya
29.5
–23.4%
+13.5%
Al-Marj
78.6
–14.1%
n/a
Gharyan
28.5
–11.4%
–10.2% +7.5%
Benghazi
78.1
–8.6%
+6.8%
Ghat
28.5
+22.6%
Tobruk
77.2
–15.1%
–5.2%
Nalut
28.0
+3.8%
–8.5%
Sirte
75.4
–13.7%
–6.4%
Zintan
27.6
+3.7%
+7.2%
Gharyan
71.5
–28.1%
–5.6%
Tarhuna
27.5
–16.9%
+16.4%
Tripoli
68.1
–23.5%
–9.7%
Tripoli
27.5
–15.4%
–1.8%
Tarhuna
67.6
–23.3%
–8.9%
Bani Walid
27.0
–19.3%
n/a
Zliten
67.6
–29.2%
–11.8%
Zliten
26.1
–22.5%
–26.6%
Bani Walid
67.5
–24.4%
n/a
Ghadamis
26.0
–24.4%
–16.8%
Ajdabiya
63.7
–27.0%
–16.7%
Murzuq
19.0
–12.6%
+4.1%
Median West
71.5
–23.5%7
–5.7%8
Median West
27.5
–15.4%7
–11.1%8
Median East
78.6
–14.1%
–1.5%
Median East
31.7
–8.9%
+20.5%8
Median South
106.5
–4.0%7
+13.7%8
Median South
38.6
+11.9%7
+13.9%8
Median Overall
81.5
–14.6%7
+3.0%8
Median Overall
29.9
–10.0%7
–2.5%8
7
8
MEDIAN FOOD PRICE INDEX OVER TIME9
Jun Jul 79.1 76.0
2
7
MEDIAN NFI PRICE INDEX OVER TIME9
Jan Dec Nov 90.7 94.8 Feb Aug Sep Oct 86.5 81.5 81.5 80.9 79.3 Jan Jun Jul Sep Oct Nov Dec Feb Aug 32.9 30.6 28.3 30.2 30.6 32.4 32.1 29.9 27.3
Libya Cash & Markets Working Group
Since January 2016
Since January 2018
12
10 04-02-18: EUR/LYD: 6.664
8
6 04-02-18: USD/LYD: 5.350
4
04-02-18: USD/LYD: 1.328
2
0 Jan 2016 May 2016 Sep 2016 Jan 2017 May 2017 Sep 2017 Jan 2018 USD/LYD at parallel market rate
USD/LYD at official rate
1 Jan
15 Jan
29 Jan
12 Feb
EUR/LYD at parallel market rate
CHALLENGES AND LIMITATIONS Coordinating a price monitoring exercise via remote management is inherently challenging, as issues of enumerator training, consistent communication and verification of results are harder to resolve from afar. The CMWG has sought to overcome these issues by harmonising procedures and data collection tools to ensure that the data uploaded is as accurate as possible.
ENDNOTES 1 Source: Official rate: Central Bank of Libya (2018, Feb 4). Retrieved from www.cbl.gov.ly; Parallel market rates: Ewan Libya (2018, Feb 4). Retrieved from www.ewanlibya.ly. The rates from 4 February and 4 January 2018 were used for the calculation of the monthly changes. 2 Reuters (2018, Jan 17). Libyan dinar climbs steeply against dollar on parallel market. Retrieved from www.reuters.com. 3 The Arab Weekly (2018, Feb 4). What’s behind the surge of Libya’s bungee-jumping dinar?. Retrieved from www.thearabweekly.com. 4 Bloomberg (2018, Jan 22). Libyans ditch dollars as oil recovery offers economic relief. Retrieved from www.bloomberg.com. 5 East: Ajdabiya, Al-Bayda, Al-Kufrah, Al-Marj, Benghazi, Derna & Tobruk; West: Al-Aziziya, Bani Walid, Ghadamis, Gharyan, Nalut, Sabratha, Sirte, Tarhuna, Tripoli, Zintan, Zliten & Zwara; South: Al-Gatroun, Al-Jufrah, Brak, Ghat, Murzuq, Sabha & Ubari. 6 The food price index was calculated by adding up the median prices of one unit of each food item (excluding baby milk and lamb meat), the NFI price index by adding up the median prices of one unit of each non-food item (excluding laundry detergent and baby diapers). Where the median value is not available, the average price across all locations was assumed for the calculation of the indices. 7 Only includes locations with reference data from January and February 2018. 8 Only includes locations with reference data from October 2017 and February 2018. 9 Includes all locations assessed in a given month.
Libya Joint Market Monitoring Initiative (JMMI) – February 2018
Distribution of Prices in Libya FOOD ITEMS 16.0
10
10.0 4.4
10.0
9.5
▶ 8.5
5
7.5
4.5 0.3
3.5 0.5
Couscous (1 kg)
Rice (1 kg)
Sugar (1 kg)
Chickpeas (400 g)
2.4 0.6
1.0
1.0
Beans Condensed Onions (400 g) Milk (1 kg) (200 ml)
2.0 0.1
1.0
Flour (1 kg)
30
1.0
3.0
1.8 1.0 1.3
1.0
Potatoes Tomatoes (1 kg) (1 kg)
15
30.0
20
Tomato paste (400 g)
1.2 0.6 ▶ 0
Bread (5 pieces)
1.0 0.8 ▶ 0 Salt (1 kg)
10
22.0 0.5
8
Shampoo (250 ml)
Libya Cash & Markets Working Group
Toothpaste (100 ml)
Sanitary pads (10 pads)
1.2
3.3 0.8
0.9
4.0 1.0
2.8 0.6
3
2.8 0.9
1.2 0.1
▶
Laundry powder (1 kg)
3.5
▶
Baby diapers (30 diapers)
2.0
4.2 2.7 0.5 ▶
Chicken meat (1 kg)
1.2
2.8
5.0 1.0
▶
Baby milk (400 g)
6.0 0.3
Laundry Dishwashing Toothbrush Handwashing detergent liquid (1 brush) soap (1 L) (1 L) (1 bar)
0
Overall median price across location medians (LYD) Change in overall median since last month (LYD)
5
8.2
8.0
7.8 0.6
11.7 1.6
0 Lamb meat (1 kg)
12.0
10.9 ▶
9.0
13.0
▶
10
▶
11.0
13.5 16.5
▶
22.0 1.7
▶
22.5
0.3
▶
Price (LYD)
30.0
▶
▶
33.0 5.0
0
3
1.2 0.1
2.5
Upper quartile: 25% of location medians are above this point
10
3
1.0
2.0
Maximum location median* in dataset (LYD)
13
16.0
20
1.5 0.2
Pasta (500 g)
40 30
2.5
How to read a boxplot
NON-FOOD ITEMS
45.0
2.0 1.0
3.0
▶
Milk (1 L)
2.5 ▶0
3.5
▶
Vegetable oil (1 L)
2.5 2.0 0.3
3.5
▶
FOOD ITEMS CONT.
Tuna (200 g)
2.9 0.1
4.0
▶
Eggs Black tea Green tea Peppers (30 eggs) (250 g) (250 g) (1 kg)
2.0
4.0
3.5
▶
1.0
3.5
▶
3.2 2.5 1.8
▶
2.1
2.2
3.5 ▶0
▶
3.6 3.0 0.4
5.2
▶
3.8 ▶0
▶
2.5
6.0
5.0
▶
3.0
0
50
5.2
▶
4.0
5.0 1.3
▶
5.0 0.5
▶
5.0
6.5
6.0
6.1 0.9
▶
Price (LYD)
15
Lower quartile: 25% of location medians are below this point Minimum location median in dataset (LYD)
* The location median is the median price of a given item in a given location.
Libya Joint Market Monitoring Initiative (JMMI) – February 2018
