In continuation of efforts at arresting the ongoing economic crisis, the Central Bank of Liberia (CBL) says it has discovered 15.2 billion Liberian dollars in circulation outside the banking system while L$1.7 billion sit in commercial banks’ vaults, totaling L$17.029 billion currently in the country.
CBL Executive Governor-designate, Nathaniel Patray, said yesterday at a meeting in Monrovia between the Government Economic Management Team (EMT) and foreign exchange bureaux and money traders that the L$15.2 billion represent 90% of the Liberian banknotes in country as at the end of May 2018.
Governor Patray said the new discovery has been the main source of the increased pressure on the Liberian dollar and instability and inflation in the exchange rate thereby causing economic hardship in Liberia.
The Governor also pointed as part of the problem, reduced foreign exchange supply occasioned by the withdrawal of UNMIL whose operation significantly contributed to supply of foreign exchange in the economy
He said given the prevailing circumstances and latest discovery, the government has crafted an action plan in enforcing every necessary and complementary policy measures that will help reduce the amount of money outside the banking system and by extension ensure broad exchange rate stability over a period of time.
Governor Patray then released the updated CBL Forex Bureaux regulations, warning that beginning today, a joint task force comprising of Ministry of Justice, City Corporation, Liberia Immigration Service, CBL and NAFEBOL (National Foreign Exchange Bureaux of Liberia) will commence enforcement of the regulations by firstly shutting down unlicensed foreign operators.
The CBL Governor said that he was aware some people may not like the regulations but the Government must act to bring economic relief to the Liberian people by reducing the pressure on the Liberian dollar, maintaining broad stability in the exchange rate and minimizing speculation in the money market.
Writes P. Nas Mulbah