MONROVIA, LIBERIA-The Central Bank of Liberia (CBL) has announced measures to provide adequate Liberian Dollars to the public, through the Commercial Banks in the Country.
The CBL said it is currently infusing money to Commercial Banks to address the shortage, but said it will be done gradually to maintain low inflation instability to protect the purchasing power of ordinary Liberians.
In a statement issued Monday, November 9, 2020, through the Ministry of Information, the CBL cannot effectively address the increasing demands of Liberian Dollar liquidity, due to its restrictive autonomy status.
The CBL said it requested the printing of seven point five (7.5) billion Liberian dollar in 2019, but the legislature only approved four billion, thus prompting demand for the local currency.
It attributed the current Liberian Dollar liquidity problem to several factors including the COVID-19 impact on the economy.
“We had requested the printing of 7.5-billion Liberian Dollars in 2019, but the legislature only approved 4-billion at the time. This means with increasing demands from several factors to include economic and population effects, dollarization, mutilation and economic precautions the need now for the printing of more liquidity cannot be overemphasized” the bank asserted.
“Of the 4-billion Liberian Dollars printed in 500-Bills, only 50-percent-meaning half of the 4-billion printed has been infused in the market which represents the ratio of about 1-to-10 of new to old banknotes in circulation”, the bank said.
The CBL attributed the current Liberian Dollar liquidity problem to several factors, including the covid-19 impact on the economy.
The CBL said it has begun working along with the International Monetary Fund (IMF), the National Legislature and other players to find a lasting solution.
The CBL renewed its appeal to the public to focus on using other mediums of payments, like mobile money and POS to carry out daily financial transactions.