Liberia: House of Representatives Re-summons CBL over Increase of Mutilated Banknotes Despite Printing of L$4 Billion New Banknotes

Capitol Hill, Monrovia – The House of Representatives has reconsidered its decision and summoned top management of the Central Bank of Liberia to appear before its full plenary to address the current flow of mutilated banknotes on the Liberian market despite infusing L$4 billion banknotes of newly printed banknotes.

In its special sitting in December 2019, the Legislature, based on the request of President George M. Weah approved the printing of additional L$4 billion banknotes to ease the liquidity pressure on the government.

In the communication to the Legislature, the President called on the Legislature to authorize the CBL to proceed with the printing of L$4 billion in the interest of “national security” and to allow Liberians to have “a great festive season.”

The President further stated that the liquidity projection [at the time] of the CBL compared to very low Liberian dollar vault cash positions of all banks, makes it imperative to infuse additional banknotes to ease the liquidity pressure as a short-term measure.

However, the resolution authorizing the printing of the new bank notes was not made public at the time as most of the deliberations leading to the Legislature’s approval were held behind closed doors.

But of recent, the House has been grilling the CBL over some of its new regulations and the infusing of the new bank notes into the market.

During the bank’s latest appearance before the House, plenary voted in favor of a motion mandating its Committee on Banking and Currency to investigate the CBL and reports its findings to for subsequent actions.

But on Thursday, the House, acting on a communication proffered by Rep. Rustonlyn Suacoco Dennis (District #4, Montserrado County) voted to re-summon the management of the CBL to appear before it full plenary for grilling.

Rep. Dennis, in her communication said the Committee has had ample time to investigate the CBL but has failed to fully address the contentious issues. In addition, she sad since that resolution that authorized the printing of the additional banknotes was signed by all 73 lawmakers, it was prudent that all of the lawmakers be allowed to form part of the grilling process to allow every electoral district be represented.

She said the money was printed to ease the liquidity problem and to also sterilize the mutilated banknotes commiserating with the L$4 billion new notes, but if the CBL printed without sterilizing, it would result to excess of L$2 billion over previous legal notes.

“It is important to note that previous resolution that calls for printing of new family of bank notes places printing at L$30 billion, accounting for L$28 billion  previously printed and two billion would be for allowance of long term growth,” she said.

“Against this backdrop, it is prudent that CBL faces the full plenary so as to enable every county and district be fully represented and abreast with the current mutilated crisis and state of the economy.”

Plenary, then voted in favor of her communication but added that the appearance is done in executive session due to its national security implications.