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Liberia: New Central Bank Governor Faces Retrenchment, New Money Printing Headaches

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RUNNING OUT OF TIME? As debate swirls around whether or not the Weah-led government should print new money, diplomatic and economic observers both agree that time is running out for a fix. Whether the route of printing new bills is the way to go, is still up on the discussion boards in court of public opinion, growing increasingly divided by the hour and day amid an ever-recurring and lingering state of uncertainty.

Monrovia – Bearing any unforeseen Senate confirmation surprise, Mr. Jolue Aloysius Tarlue is poised to become the next governor of the Central Bank of Liberia.


Rodney D. Sieh, [email protected]


President George Manneh Weah, on Friday named Tarlue as the new Governor replacing Nathaniel R. Patray, III who resigned on October 24, 2019.

An Executive Mansion statement Friday said the appointment came following a comprehensive vetting process by a team of experts that he had set up.

Mr. Tarlue was among a shortlist of prospects, recently speculated by FrontPageAfrica.

“Where is the money? Why should we print new money without proper accounting of the money Gov. Patray insisted was received by the Bank? These are questions, amongst other relevant concerns that Pres. George Weah and his Economic Management Team must be made to answer before requesting the Legislature for approval to print “new bank notes.” Until then, a big NO should be given to any such request to print “new bank notes.”

Senator Abraham Darius Dillon(Liberty Party, Montserrado County)

FPA had previously reported that the search had hit a snag with Mr. George Fonderson, one of the top prospects turning down a legitimate offer to replace the governor. According to multiple sources within the administration, Mr. George Fonderson, Chairman of Baker Tilly Liberia, and one of the country’s highly-regarded finance professionals, reportedly told the government that he is currently committed to various international projects and engagements, making it virtually impossible for him to accept the role.

Mr. Tarlue is expected to lead a team of other governors in restructuring the Central Bank of Liberia to tackle Liberia’s challenging economy.

The incoming CBL chief worked with a plethora of important banks and other financial institutions in the United States of America including J.P. Morgan Chase, BNY Mellon N.A., Deutsche Bank, Merrill Lynch and HSBC Bank N.A. amongst many other executive level financial establishments.

Mr. Tarlue holds MPA (specializing in Public Policy) from Kean University, New Jersey (USA) and BA in Political Science from the King University in Bristol, Tennessee (USA).

Prior to his preferment by President Weah, Mr. Tarlue was Chairman, Board of Commissioners of the Liberia Electricity Renewable Commission. Mr. Tarlue’s appointment is subject to confirmation by the Honorable Liberian Senate.

If confirmed by the Senate, Tarlue’s first order of business would be how the bank handles the emerging controversy over the printing of new Liberia dollars and the issue of retrenchment and cost cutting measures in the backdrop of the International Monetary Fund(IMF) push for the bank the fix the messy situation left by Patray.

The former governor, in the short time he was in the job reportedly increased the bank’s payroll to some 400 new hires.

The IMF had previously urged the CBL to significantly tighten monetary policy to reduce the inflation that was eroding the living standards of the poorest Liberians, while taking strong measures to safeguard financial sector stability.

In addition, the IMF Executive Directors in October noted that Liberia was facing major economic challenges and emphasized the need for steadfast and well-sequenced policies and structural reforms, as these were essential to regaining macroeconomic stability and promoting high, sustainable, and inclusive growth.

The directors emphasized that significant fiscal adjustment was needed going forward, including by mobilizing additional domestic revenue and rationalizing spending, especially in the wage bill, while securing needed fiscal space for social and capital spending. They also called for further progress in public financial management reforms to improve the quality of spending in a resource-constrained environment, and for improvements in the business environment to attract high-quality, growth expanding investment.

The issue was resurrected by former Auditor General John S. Morlu, who alarmed that the IMF had made it prior action number for the CBL to dismiss the reported 400 persons brought on by Patray before it can be ushered into its Extended Credit Facility Program.

Mr. Morlu’s assertions were immediately rebuffed by both the CBL and the government.

First Order of Business: Retrenchment

In a statement last week, the CBL dismissed the reports that it is planning a massive layoff of some 400 of its staff in compliance with the International Monetary Fund’s request to slice the wage bill.

The CBL countered that reports of massive redundancies, to the tone of 400 staff members – something that would amount to more than 50% of all its employees, is simply untrue. “This story, first reported in the Frontpage Africa Newspaper on Friday, 1 November 2019, has the potential of sowing discontent at the Bank and within the wider society and, in so doing, undermine the recent hard work by a renewed and re-invigorated CBL Board of Governors to enhance the credibility of the Bank as the Monetary Authority of the Country.”

The CBL Tuesday that, like other public sector organizations, it is implementing an austerity program that will qualify the Government of Liberia for an IMF-Supported Program, which is critical to the country’s economic recovery in the medium term. “However, nowhere is CBL planning to lay-off more than half of its entire human resources.

Admittedly, the current level of CBL staffing is unsustainable, but the final figure, which is yet to be decided by the Board of Governors, is not likely to exceed 10% of its wage bill and that most of the expectedly redundant staff could be considered under a contractual arrangement.”

While the ongoing negotiation is in an advanced stage, the bank said there are still issues to be concluded between the IMF staff and the Government, of which the CBL is an important player.

Skepticisms over the printing of the new bills follow a storm over the unexplained alleged disappearance of LD16 billion printed by the administration of former President Ellen Johnson-Sirleaf.

CBL averred: “The austerity program that CBL is currently implementing was necessitated by several years of deficit financing, going as far back as several past administrations. More than this, CBL austerity program involves more than just laying off staff. It also includes other components of the budget. It is important to also note that the proposed budget cut of the Bank is intended to strengthen the financial position of the Bank to enable it effectively perform its primary function of ensuring both monetary and financial stability.”

The CBL’s response was followed by the Information Minister Lenn Eugene Nagbe, who described the report as a “blatant propaganda.”

Said Nagbe: “The truth is hiring at the CBL is too high relative to hiring at central banks in other countries. Countries are compared on everything in the developing world. If hiring at the central bank in Sierra Leone or in Guinea is not this high, the central bank in Liberia should be expected to do the same. In Liberia, the Central Bank of Liberia has run deficits for a long time, which means they use reserve money to pay salaries or operational costs. Central banks are supposed to run surpluses and give back to Government. But the difficult economic situation in Liberia has made this difficult over the years. So, the Bank has been financed through reserve. If the budgets or salaries are too high, this comes at a cost to reserve.”

Second Order of Business: LD Printing Saga

Mr. Tarlue is also coming to the bank mired in a nagging controversy over reports that the government is looking to print some LD34 billion worth of local currency.

Immediately after President Weah’s appointment of Tarlue was made public Friday, Rep. Acarous Moses Gray(CDC, Montserrado County, District No. 9) suggested in a Facebook post that the move was timed toward the printing of new money.

“Gradually we will fix the economy. We will put in all measures and print the money.”

Rep. Gray, in a pointed jab at critics, a day earlier, had triggered a storm, when he said: “The printing of money will help pay our civil servants on time for the Christmas break but you are kicking against it because you believe that if the civil servants are not paid on time they could join you in your so-called “Weah Must Resign Failed Protest”

Last week, Minister Nagbe explained that because the IMF is going to give Liberia money to support its reserve and balance of payment positions, the first order of business was to make sure the new money is not used the way it was used in the past 12 to 14 years. “THIS IS WHAT CHANGE IS. So, the CBL and the IMF will work out ways of reducing CBL budget as a prior action. Wage reform, as we also see on the fiscal side, will have to take place, but this does not mean the immediate firing of 400 people. Will people go? Yes. How many? These details are being worked out between the CBL and the IMF and the real number will be known soon, but they will be far less than 400. There are other strategies that the bank is reviewing with the Fund to resolve these issues.”

“Because the IMF is going to give Liberia money to support its reserve and balance of payment positions, the first order of business was to make sure the new money is not used the way it was used in the past 12 to 14 years. “THIS IS WHAT CHANGE IS. So, the CBL and the IMF will work out ways of reducing CBL budget as a prior action. ”

Mr. Lenn Eugene Nagbe, Minister of Information, Culture Affairs and Tourism

The government has insisted that it inherited a very large wage bill. Thus, Nagbe said, the government wage grew from about US$100 million in 2009 to about $289 million in 2017. “This was explosive growth. During this period, the previous Government should have worked very hard to grow the private sector to move Liberians there. Very little of this happened.
Large aid money received was used to pay very large salaries. Development partners complained but nothing was done about it.”

Skepticisms over the printing of the new bills follow a storm over the unexplained alleged disappearance of LD16 billion printed by the administration of former President Ellen Johnson-Sirleaf.

A report by the USAID-sanctioned and financed Kroll’s analysis of the delivery documents provided by the Central Bank of Liberia(CBL) confirmed that while new banknotes totaling LRD 15.506 billion were received into the CBL’s reserve vaults, the auditing firm found no information to support allegations that a container of banknotes went missing.

Nevertheless, the bills have been scarce in the banks since the Weah-led government took office.

The Kroll did raise concerns regarding the overall accuracy and completeness of the CBL’s internal records. “The Report identifies systemic and procedural weaknesses at the CBL, and identifies shortcomings in Liberia’s fiscal and monetary management processes that are longstanding and continue to the present day,” according to the statement.

Nevertheless, the government appears resigned to go on with the printing.
President Weah, this week summoned members of the legislators to break off their “constituency break” in a bid to speed up debate over the printing of new bills and Tarlue’s appointment is seen as another step in that direction.

The special sitting is expected to commence from November 18 to December 16, 2019.

On Monday, Finance & Economic Planning Minister Samuel Tweah, in a simulcast interview aired across the nation stressed the importance of printing new or additional Liberian banknotes to avoid scarcity during the festive season.

Representative Acarous Moses Gray (CDC-District #8 Montserrado County) said the reasons for the quick return is to focus on strengthening the country’s economy. “We are returning for economic reasons. We will work to strengthen the economy,” Representative Gray said.

All this as consumers are struggling to gain access to their own accounts and withdraw money amid the scarcity of monies, both local and US currency.

Over the past few days, FrontPageAfrica has learned that representatives from the IMF have been busy going over paperwork with staffers at the CBL in hopes of helping the bank recover from former governor Patray’s aftermath.

Divided Court of Public Opinion

Senator Abraham Darius Dillon(Liberty Party, Montserrado County) is among a handful of Senators and legislators threatening to resist any new printing of money.

The Senator’s argument is that in October 2018, former Governor Patray issued a statement to Liberia and the world to the effect that no money was missing and that the printed 16B Liberian Dollars consignment was received by and through the system of the Central Bank of Liberia.

Thus, Senator Dillon asks: “Where is the money? Why should we print new money without proper accounting of the money Gov. Patray insisted was received by the Bank? These are questions, amongst other relevant concerns that Pres. George Weah and his Economic Management Team must be made to answer before requesting the Legislature for approval to print “new bank notes.” Until then, a big NO should be given to any such request to print “new bank notes.”

Over the past few days, FrontPageAfrica has learned that representatives from the IMF have been busy going over paperwork with staffers at the CBL in hopes of helping the bank recover from former governor Patray’s aftermath.

The Senator is also calling for the former governor to be summoned before the Legislature to answer some questions. “He presided over the CBL. He was part of infusion of $25M United States Dollars into the market without proper accountability up to date. He must be made to answer. We will lobby with our Colleagues in the Legislature to ensure he appears to answer all the concerns upon our return to regular Session next January.”

As debate swirls around whether or not the Weah-led government should print new money, diplomatic and economic observers both agree that time is running out for a fix. Whether the route of printing new bills is the way to go, is still up on the discussion boards in a court of public opinion, growing increasingly divided by the hour and day amid an ever-recurring and lingering state of uncertainty.

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