Leader of The Alternative National Congress Issues Caution Over Printing New Liberian Dollar Currency
Monrovia – The political leader of the Alternative National Congress(ANC) says a recent request by the Central Bank of Liberia to the national legislature, seeking approval for the printing of a new family of banknotes, must be treated with extreme caution and critical analysis before approval is given.
In a statement Monday, Mr. Cummings said: “This is to avoid unintended consequences that may adversely exacerbate the already difficult economic conditions faced by the country. Monetary policy, like all economic policies intended to cure defects in the economy, requires a clear definition of the problem, the prescription for remedy, and objectives or outcome to be achieved. Anything to the contrary is tantamount to side-stepping the main vexing issues underpinning our current monetary space and may lead us into a circular path to nowhere, or what I often refer to as ‘doing the same thing over and again and expecting different result.”
The ANC leader said the critical problem haunting monetary policy in the Country, as even alluded to by numerous expert reports and analysis, including Kroll, is the lack of confidence in the banking sector due mainly to systemic failures, administrative inefficiencies, and mismanagement.
Thus, he averred, the key questions for the Legislature and those responsible for our monetary policy are: What has led to the complete loss of control of monetary policy by this government? How can the printing of 48 billion family of currency, as necessary as that might be at some point in the future, solve the confidence crisis now? Which should come first, the printing of this huge quantity of money amidst the systemic, administrative, and managerial issues, or the resolving of those defects before printing additional money?
Mr. Cummings offered a few pointers for the CBL and legislators to ponder.
First, he said, the CBL, by its own admission, has indicated that the total estimated volume of money currently in circulation is 23bn (twenty-three billion). “Why is it requesting the printing of 48bn (forty-eight billion), a difference of 25bn, which doubles the original amount in circulation?”, he asked.
Secondly, Mr. Cummings wondered whether there has been a proper audit and accounting of all previous monies printed, including the recent printing of 4bn (four billion) before the last December Senatorial elections that included LRD 500 notes that were reportedly out of the commercial banking sector?
Additionally, Mr. Cummings said, the Minister of Finance and Development Planning, by his own admission, announced the successful subscription of auctioned Bonds intended to retrieve Liberian Dollars outside the banking sector. “Despite the Minister’s pronouncement, Commercial Banks were reporting serious liquidity problems. There needs to be an audit and accounting of the sales of Bonds.”
The ANC political leader said both the Finance Ministry and CBL are still to fully account for the mismanagement of the 25 million United States Dollars. “To date, no one has been held accountable,” he said.
Mr. Cummings also averred that the Weah administration is yet to fully comply with the KROLL and PIT’s Recommendations calling for a forensic investigation into the USD25 million “mop-up” fiasco.
Said the ANC leader: “In addition to the above issues, it is confusing for the CBL of late to be heralding the digitization of the economy or the use of mobile money, ATM, and other electronic money transaction systems and at the same time requesting the printing of such huge sum of money, even if it were for reserve purpose. In the absence of proper sanitization of the system and proper accountability and transparency, the problem of LACK OF CONFIDENCE in the banking sector will continue to persist. Also, the printing of huge sum of currency, if not managed properly, especially by what is evidently an inept and incompetent government, will lead to inflation that could worsen the suffering of the Liberian people.”
Mr. Cummings said the rush to print such a huge amount of currency without addressing the many controversies and questions surrounding past monies, especially the USD25 million mop-up fiasco could lead to the sanctioning of individuals of this government for money laundering as hinted in the KROLL and PIT Reports, and could also put the Country at risk of being blacklisted. “We, therefore, call on the Senate to delay the CBL’s request for the printing of 48 billion until there is full accountability of previous monies and until there is sanitization of the system.”