The new Executive Governor of the Central Bank of Liberia has vowed to ignore or downplay policies at the Bank to enable him meet dictates of President George Manneh Weah regardless of the economic and financial repercussions to the state. This means he would bend the rules for political expediency at the expense of conventional practices.
Executive Governor Nathaniel Patray believes this would afford him the opportunity to work with the technical economic management team in executing mandates of the President’s.
President George Manneh Weah’s mandates to the economic management team set up in early July include among others (1) immediate infusion of US$25 Million in the economy to mop up excess liquidity of Liberian dollars, which has reportedly been executed; (2) A mandate to the Central Bank to provide more effective supervision and regulation of money-changers or foreign exchange bureau; (3) A mandate to the Central Bank to provide more robust oversight of banks under its supervision; and (4) Conduct a comprehensive review of regulations on the hoarding of both Liberian dollars and U.S. dollars outside the banking system, and provide incentives and safeguards to encourage the utilization of the banking system, including financial instruments.
Governor Patray maintains “…We are working at the President’s mandate — technical economic management team which is different from the mandate of the Central Bank that is within the Bank’s act. We will work with the Bank’s Act, but if it is necessary to sideline it for a while to get the President’s own mandate accomplished, we will have to do that.”
We believe this posture by the new CBL Executive Governor squarely contradicts policies at the “Bankers’ Bank” that will have serious negative future consequences for our country. Although fully aware that the Governor works at the will and pleasure of the President, but we caution that giving in anyhow to pleasing him thru unorthodox means could be counterproductive to functions of the Central Bank.
The 1999 Act establishing the Central Bank of Liberia bars Governors of the Bank from maintaining affiliations that could interfere with their duties.Section 17 (c) of the Act states, “The Governors shall not be regarded as delegates on the board of any commercial, financial, agricultural or industrial or other business interest or receive or accept directions therefrom in respect to duties to be performed under this Act.”
Among other functions, Executive Governors are to independently advise the President on monetary policies and Macroeconomic issues, void of politics. But the way Governor Patray intends to proceed at the CBL could negatively undercut these traditional roles.
Since the Central Bank of Liberia was established in 1999, this is the first Executive Governor that is publicly on record in saying he would circumvent the rules to satisfy the President no matter what.
Liberians, beware! The writings are on the wall of things to come. We must brace ourselves for future economic and monetary implications in satisfying short and long-term political interests at the Central Bank albeit unconventionally.