The opposition party Movement for Economic Empowerment or MOVEE has strongly reacted to recent criticism by the Liberia National Union (LINU) against its standard bearer, former central bank governor Mills Jones, whose policy at the CBL has been blamed for the depreciation of the Liberian dollars.
LINU leader Nathaniel Blamah, said loan scheme initiated by Dr. Jones while serving as Executive Governor of the Central Bank of Liberia, uncontrollably dishing out unspecified amount of Liberian dollars to citizens across the country, is grossly responsible of the rapid depreciation of the Liberian dollars, and skyrocketing of the exchange rate between the LRD and the U.S. dollar with the former hitting triple digit until recently.
But in a statement issued in Monrovia on Sunday, February 19, MOVEE cautioned Mr. Blamah that it is better to keep quiet and let people think he is properly informed than to open his mouth and confirm that he’s not.
“We have little sympathy for Mr. Blamah because as one hoping to take leadership position in Liberia, he should learn to speak responsibly. As a political leader, he owes it to the Liberian people. Blabbing just to be heard, about a subject for which he is out of his depth, and against an individual for whom he is no match, is hardly the mark of leadership,” the statement read.
In his recent criticism of Dr. Jones, Mr. Blamah noted that loans were reportedly given to people who did not have the capacity of using the funds here, instead; many of the borrowers took the money out to foreign lands for exchange of goods and services.
“This is totally contrary to explanations for the pressure on the Liberian dollar, given by both the current Minister of Finance and the current Executive Governor of the Central Bank of Liberia, as well as many others. Mr. Blamah must certainly know something that many serious-minded people do not. However, the only thing more ridiculous than Mr. Blamah’s statement is that it is coming from the leader of a political organization”, MOVEE responded in defend of its standard bearer.
According to the party, had Mr. Blamah taken time to read reports from the CBL, he would have known disbursements under the microfinance initiative, rather than being “unspecified” to use his word, amounted to approximately L$ 644 million (six hundred forty four million Liberian dollars) during the period January 2012 to December 2015–a three year period,” the party said.
According to MOVEE, the CBL under Dr. Jones initiated a policy of selling Central Bank Notes in order to help control Liberian dollar liquidity in the economy.
It pointed out that during the period July 30, 2013 to August 14, 2015, about the same time when the microfinance loans were initiated, the CBL sold more than Liberian dollar 9 billion worth of CBL Notes, that is, liquidity withdrawal through the CBL Notes was more than 13 times the amount of the loans.
“This is not what one would call expansionary monetary policy. During this period, the CBL also had a weekly auction program, selling US dollars mainly to businesses. What this means, essentially, is that the CBL was taking Liberian dollars in while putting US dollars out into the economy. This helped to stabilize the exchange rate, even during the Ebola crisis,” the party further argued.