(MENAFN) Libya’s eastern-based House of Representatives took decisive action on Tuesday by approving a public debt law during a plenary session held in Benghazi, parliamentary spokesperson Abdullah Blehig announced on Facebook.

The law’s passage followed thorough debates and incorporated input from the parliament’s Finance Committee, although some members voiced objections to specific clauses, Blehig noted.

Designed to tighten borrowing controls and boost fiscal transparency, the legislation creates a dedicated account to build a debt repayment reserve. It also bars government borrowing—both domestic and foreign—without explicit authorization under the new law’s framework.

This legislative move comes as Libya grapples with a deepening economic crisis marked by escalating public debt and fragmented financial governance dating back to 2014, according to parliamentary insiders.

Since the 2011 NATO-supported uprising that ousted former leader Muammar Gaddafi, Libya remains politically split between the UN-recognized Government of National Unity in Tripoli and the eastern administration backed by the Libyan National Army under commander Khalifa Haftar.

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