Liberia: Policy & Research Group Calls for Investigation into U$25m Infused into the Economy to Mop up Excess Liquidity

Monrovia – The Center for Policy Action and Research, CePAR, is demanding an investigation into how the US$25 million infused into the economy to mop up excess Liberian dollars was expended.

The group called on the Legislature to exercise its oversight responsibility by recommending the investigation.

Their demand comes at a time when other pressure groups are caling on the international community to prevail on the Government of Liberia to investigate and account for L$15 billion in banknotes reportedly missing from the Central Bank of Liberia.

The Executive Mansion on July 16, 2018 disclosed that with the infusion of the US$25 million in the economy through the Central Bank of Liberia to mop up the excess liquidity of Liberian dollars.

However, CePAR expressed concern that though the government announced that some monies were mopped, up, there has been no proper accounting 3.7 billion Liberian dollars was mopped up over the period covering July 16, 2018 to September 22, 2018. 

“A CePAR investigation was unable to verify the use of Commercial Banks when the Liberian Dollars were ‘mopped’. Our investigation, however, found also that the Central Bank of Liberia exercised a direct mop up option through the use of lorries in acquiring the ‘Liberian Dollars’ from the market. A direct mop up approach as adopted by the CBL in the use of the 25m United States Dollars, CePAR contends, is susceptible to misuse and fraud. The CBL, CePAR also believes, does not have the staffing capacity to mop up almost 4 billion Liberia Dollars from the market,” said the group in a press statement.

CePAR encouraged the Legislature to demand from the Central Bank of Liberia the following:

Data to demonstrate that there were excess Liberian Dollar Banknotes on the market thus facilitating the need for a mop up.

That the CBL provides the Legislature the underlying analysis that found the use of foreign exchange outlets an attractive outlet as opposed to commercial banks when it was financially prudent to do so through the commercial banks. 

That the CBL provide an economic impact analysis or an Impact Assessment Report after the infusion of the funds in the economy. 

The Center for Policy Action and Research also called for a full audit of the Central Bank of Liberia over the use of the 25m United States Dollars and establishing the causation of the rapid rise in inflation/depreciation of the Liberian Dollars.