Monrovia – President Sirleaf has received specimen the initial series of the newly printed banknotes from Central Bank Executive Governor Milton Weeks including denominations ranging from LD$ 01 to $100.

According to an Executive Mansion release, the Liberian leader made the commendation on Thursday, September 29, 2016 in the Cabinet room of the Ministry of Foreign Affairs and commended Governor Weeks and team for the hard work and level of professionalism.

Presenting the new banknotes to President Sirleaf, Central Bank Executive Governor, Milton Week said the series of the newly printed Banknotes is guaranteed and has features that cannot be duplicated easily. He expressed gratitude to President Sirleaf for the support given the Central Bank.

“It is my pleasure to present to you today the initial series of the new currency that have been produced by “Print Currency”, a US-based company but manufactured in Sweden”.

Governor Weeks said denominations covering LD$001 to 100 (L$5, L$10, L$20, L$50 and L$100) has been completed and is expected to be released to the public next month (October), and will also replace mutilated bank notes already in circulation. 

The newly introduced denominations contain portraits of ordinary Liberians on the front, and Liberian wildlife on the back. CBL has ensured that the new series is printed on a higher quality substrate to guarantee longevity and reduce porosity.

In separate remarks, Vice President Joseph N. Boakai and Senate Pro-Tempore, Armah Jallah thanked Governor Weeks and team for job well done and admonished them to create more awareness on the handling of the new money by citizens.  

Earlier, President Sirleaf received a high-level delegation on Zero Hunger Strategic Review headed by Governance Commission Chairperson, Dr. Amos C. Sawyer  expected to be conducted by Liberian institutions and organizations aimed at boosting the government’s capacity to tackle hunger and mal-nutrition.

The initiative is a comprehensive review of food security and nutritional strategy with the view to bringing Liberia to zero hunger.

He said when all is completed in terms of the technical details, the initiative will be launched in February or March 2017.

Speaking during the gathering, Agriculture Minister, Dr. Moses Zinnah expressed satisfaction and pointed out that Liberia has the potential to achieve zero hunger.

“We will not rest until we get it done”. According to Dr. Zinnah, this strategy provides a framework for collaboration in which we can all focus on what we need to do to ensure food is available in sufficient quantities to all Liberians.

Also in attendance were former Agriculture Minister Dr. Chris Toe, G. Pewu Subah, Consultant, and Cllr. Seward Cooper among others.

Monrovia – Since the start of 2016, the Liberian economy which experienced two recent shocks-the outbreak of the deadly Ebola virus and the decline in the prices of commodities including iron ore, rubber, and others on the world market has been experiencing downturn which is compounded by devaluation of the Liberian dollars specifically in exchange with the United States dollars-its main local trading partner.

Currency marked with security features aims to deter fraud and counterfeiting, and are identifiable by an individual, machine, Says the CBL

The two currencies are treaded as legal tenders in Liberia, making it a major problem when one- mainly the Liberian dollar falls drastically against the other as the accompanying effects are felt through increment in the prices of basic commodities on the local market.

While the Liberian dollar and the United States dollar are both legal means of purchase, many Liberian prefer carrying the United States dollars perhaps for many financial and economic reasons-the United States is not printed by the Liberian government and as such the currency is normally scare as compared to the Liberian dollars.

Besides, the United States dollar meets the essential requirements of good money- including general acceptability, stability, portability, durability, storability, amongst others, which the Liberian dollar does not meet.  

During the year the Liberian dollar has basically lost some of the key characteristics of a good currency such as including general acceptability, stability, portability, durability, storability, amongst others. 

A good money depends on whether it is generally acceptable in the sale and purchase of goods and services and this feature the Liberian dollar has been finding it difficult to meet.

In many commercial places, merchants prefer to sell in United States dollars and purchasers are compelled to buy United States before transacting or pay a high exchange rate than the normal pronounced by the Central Bank of Liberia.

The Liberian dollar is also not readily portable since the highest denomination is a $100 bank note and on the question of durability the currently hardly withstand the test of time. In market places the banknotes are mutilated in huge quantity further reducing the quantity of the supply of the currency on the market.

Fluctuations in the exchange rate between the United States dollar and the Liberian dollar which is also the same situation with the rate in exchange with other international currencies make the Liberian dollar unstable as traders will normally fear that keeping the Liberian dollars put them at risk on incurring losses when the Liberian dollar further deprecates in value.

These factors amongst others make the currency to be considered worthless due to the uncertainty over what is expected to happen to the currency in terms of its value in the future.

Actions to resolve

The Central Bank of Liberia in an apparent attempt to help solve some of these problems affecting the currency requested Legislative endorsement to print and replace mutilated bank notes.

In a statement issued Wednesday, the bank announced that in keeping with its statutory mandate to at all times ensure that the integrity of the Liberian Dollar is uncompromisingly maintained, it will shortly introduce a new series of banknotes into the Liberian economy.

The CBL statement indicated “This new series includes, among others, the unifying nature of the existing Liberian Banknotes, and as such, has maintained all previous portraits. The CBL has also reinforced the security features in the new series, which are both visible and invisible. 

In addition, the Bank has ensured that the new series is printed on a higher quality substrate to guarantee longevity and reduce porosity. The new series also introduces a new denomination of L$500 (Five Hundred Dollars), in addition to the present denominations”.

The bank has also announced that the bank notes expected to be infuse on the market soon have security features that will prevent fraud and counterfeiting.

“The CBL also takes keen interest in tackling the two major risk issues associated with banknote lifespan, namely: soiling and porosity.

The CBL, therefore, confirms to all stakeholders, including the general public that the new series of banknotes to be released, will be fully on par with the existing Liberian Dollar Banknotes as legal tender for all transactions”, the Bank declared.

According to the CBL, some of the features of the new bank notes will help the public, professionals, machines and the bank itself to detect any counterfeiting.

Amongst some of the common ways of identifying any possible counterfeit bank notes, the bank stated that looking, feeling, tilting, using hand held devices, UV Lamp, Magnifying glass, Low Speed-Vending, ATMs and high speed-Sorting can help.

New domination introduced

One of the major improvements in the CBL attempt to handle the currency situation is the introduction of a new denomination-the LD$50 single banknote.

The new denomination will in one way or the other help in meeting some of the requirements of good money-its portability.

Trading with the new L$50 when the quantum of money involved is huge will be much easier as compared to the L$100, 20, 10 or 5.

The portability feature of the currency is clear shown in recent time when it appears that there was shortage of L$5 banknote on the local market and traders were even hesitant in accepting purchase using large quantity of L$5 banknotes since the quantum has to be so huge to meet a certain amount for purchase.

Financial experts believe that the CBL could even make more changes by introducing L$1,000 single bank note which can be useful for transactions involving huge sums of money.

The Nigerian Naira for example is printed in denominations of 10, 20, 50, 200, 500 and 1000. The one dollar Naira which was the lowest has already phased out making 10 to be the least denomination of the Nigerian banknotes.

Besides coins known as pesewas, the Ghanaian Cedis banknotes also have denominations of 1, 5, 10, 50, 100 and 1,000.

The Ivorian banknotes are also printed in denominations of 500, 1,000, 2,000, 5,000, 10,000 francs.

Liberia could also be better printing its bank notes like neighboring countries to meet the portability requirement of money.

Monrovia – The Liberian currency, the Liberian dollar, has significantly depreciated in terms of value on the exchange market, trading as low as L$91 to US$1, one of the worst in the recent history of the country.

“The Speaker and his LPDP in collaboration with some elements of the Unity party have agreed and decided a need to print more money to fund their campaigns. We thought that by printing more money it will escalate the already depreciated Liberian dollars that has gone to the rate of LD$91 to US$1”- Representative Edward Forh, Congress for Democratic Change

Operating a dual currency regime with the United States and Liberian dollars as legal tenders, fluctuations in the exchange rate greatly affect the prices of basic commodities that are mostly sold in Liberian dollars but traders have to purchase in United States dollars on foreign markets.

To compensate for the loss in value in the Liberian dollars when exchanged to United States dollars, traders increase the prices of their commodities, leaving the consumers to feel the pinch.

While the Liberian dollars continues to depreciate against the United States dollars, the House of Representatives has endorsed President Ellen Johnson Sirleaf’s request to print additional bank notes.

The House voted Thursday in favor of the President Sirleaf’s request after the Committee on Banking and Currency chaired by Representative Julius Berrian (CDC-District #10, Montserrado County) submitted a report to plenary.

Making the report on Thursday, Representative Berrian said after several meetings and revisions with Central Bank officials, the joint committee members and other stakeholders, the Committee resolved to recommend to the plenary of the House of Representatives to allow the CBL print additional bank notes to replenish the Liberian dollars reserve.

A month ago President Ellen Johnson Sirleaf wrote the National Legislature, seeking permission for the Central Bank of Liberia to print additional bank notes.

The CBL under Dr. J. Mills Jones advanced similar request to the Honorable House of Representatives. The communications from the CBL and the President were transferred to relevant committees with a mandate to analyze the request and guide plenary in making informed decisions.

According to the committee report submitted by Chairman Berrian, there were a total of three meetings held to familiarize itself with the issue at hand. Additionally, the committee stated that it conducted series of hearings with relevant stakeholders including the management team of the CBL.

The committee report stated: “During the hearing with the Central Bank, the Committee established that the bank is justified for requesting this authorization. This, in the wisdom of the Joint Committee, will certainly strengthen the reserve position of the bank and capacitate it to respond to the economic needs and demands of government and the general public.”

“The committee also established that the last time the bank undertook similar action was approximately five years ago. It is common knowledge that printed notes

are subjected to factors that lead to reduction in their quantity and quality in the circulation. One of such factors is mutilation,” the committee further declared.

Dissenting Lawmaker thrown out

Representative Edward Forh (CDC-District # 11 Montserrado County) who spoke against the decision for the printing of additional bank notes was thrown out of session on the order of Speaker Alex Tyler.

Rep. Forh was accused of attempting to disrupt session after expressing strong view against the President’s request for the printing of new bank notes.

The Lawmaker claimed that he was ignored by the Speaker whenever he sought recognition to speak on the issue of printing new bank notes despite several attempts to have the Speaker recognize him to make an input on the discussion. Representative Forh had earlier resisted the order from the Speaker to leave session did leave after interventions from his colleagues.

He is accusing Speaker Tyler and people he described as elements from the ruling Unity Party of supporting the decision to print new bank notes to fund their campaigns.

Lawmaker Forh said: “The Speaker and his LPDP in collaboration with some elements of the Unity Party have agreed and decided a need to print more money to fund their campaigns. We thought that by printing more money, it will escalate the already depreciated Liberian Dollars that has gone to the rate of ninety-one to one US dollars”.

The Lawmaker continued: “If their argument that there is a shortage of Liberian dollars on the Liberian market than why is the Liberian dollars not appreciating against the US dollars because the US dollars has reduced according to the President annual message and the governor of the CBL and finance minister.”

Citing other reasons for his dissent, Representative Forh said: “Our foreign reserve activities have reduced, our iron ore trade has gone down, so we lost US dollars, our rubber trade has reduced so we lost US dollars. The logging industry is not too good; we lost US dollars, so there are fewer US dollars chasing the Liberian dollars.”

He accused Speaker Tyler of forming a political party in the House of Representatives. He said the new Party chairman, Representative Moses Kollie, chairs the committee on Ways Means and Finance of the House of Representatives.

He also claimed that the committee, without any reliance, says the vault of the Liberian dollars at the CBL is empty and wants to print the amount of fifty Million dollars without telling the people of Liberia the amount of mutilated banknotes that need to be replaced.

President Sirleaf, in a communication dated Thursday March 3, 2016, informed the Lawmakers that she received two letters from the Central Bank of Liberia advising that the economy may be seriously affected due to the lack of local currency to meet National needs.

According to President Sirleaf’s communication, the first letter dated December 23, 2015 was sent by the then Executive Governor and the second of such letter dated February 19, 2016 sent by the Acting Executive Governor Mr. Charles Sirleaf.

The President’s Communication stated: “While the decision needs to be made now to address this issue that impacts the economy, it is important to note that the printing of notes will require a period of some five months. The underlying reason for the delay that has led to the crisis has to do with the interpretation of Article 34 (d) of the constitution and the Act to Authorize the Establishment of Central Bank of Liberia as amended.”

The President also stated as conveyed by the letters from the CBL referred to above, the Central Bank of Liberia is of the opinion that by the article referred to above, the legislature has granted implicit approval to the CBL to issue local currency and believe that the legislature has registered a contrary view.

“These issues of interpretation should be resolved at an appropriate time, preferably sooner than later. Mr. President Pro-Tempore, I have advised the acting executive Governor to seek the opportunity to discuss this matter with you and with your committees as you will dictate. I hope that you can agree on the way forward to enable the CBL to move forward in a timely manner to conclude arrangements for printing of currency,” the President communication added.

At the time of the President’s letter she received criticisms from the public for seeking the consent of the National Legislature for the printing of more money in the wake of the limited time she now has in power, expressing fear that this move may cripple the already crisis prone economy.

The Liberian economy has been experiencing crisis since the country experienced the outbreak of the deadly Ebola virus during the entire 2014. After Ebola the country has not been able to overcome the shock from the consequences of the crisis and further compounded by decline in the prices of commodities in the extractive industry-rubber, iron ore, etc., the major source of income for Liberia, the economic situation has been deteriorating in 2016.

 The President request is in keeping with article 34 (b) of the Liberian constitution.

“While the decision needs to be made now to address this issue that impacts the economy, it is important to note that the printing of notes will require a period of some five months. The underlying reason for the delay that has led to the crisis has to do with the interpretation of Article 34 (d) of the constitution and the Act to Authorize the Establishment of Central Bank of Liberia as amended”-President Ellen Johnson Sirleaf

Article 34 (b) of the constitution gives the legislature the power to levy taxes, duties, imports, exercise and other revenues, to borrow money, issue currency, mint coins, and to make appropriations for the fiscal governance of the Republic, subject to the following qualifications: which includes; all revenue bills, whether subsidies, charges, imports, duties or taxes, and other financial bills, shall originate in the House of Representatives, but the Senate may propose or concur with amendments as on other bills.”

“No other financial charge shall be established, fixed, laid or levied on any individual, community or locality under any pretext whatsoever except by the expressed consent of the individual, community or locality. In all such cases, a true and correct account of funds collected shall be made to the community or locality.

The Central Bank of Liberia (CBL) was established on October 18, 1999 by an Act of the National Legislature of the Republic of Liberia. It became functional in 2000 and succeeded the National Bank of Liberia (NBL). The principal objective of the CBL is to achieve and maintain price stability in the Liberian economy.

Henry Karmo (0886522495) henrykarmo@frontpageafricaonline.com