Amid serious shortage of Liberian banknotes in circulation, information from the corridors of the Capitol and the Executive Mansion suggests that both members of the House of Representatives and the Liberian Senate are expected to return from annual break for two week’s special sitting on plan by the government to print additional local currency.
Sources close to the leadership of the two chambers say President Weah is requesting for the special sitting for the sole purpose of adopting a resolution for the printing of additional banknotes.
Commercial banks operating here are faced with liquidity crisis, which has led to restricting customers, thereby pushing the exchange rate between United States dollars and the Liberian dollars from LRD200 to LRD175 for US$1.
Earlier, the Central Bank of Liberian had printed about LRD$5 billion, but authorities of commercial banks claimed that said money is not in circulation as it is hardly seen in the market.
Both the House of Representatives and the Liberian Senate are yet to respond affirmatively about the return, but it has become an open secret between the executive branch and the Legislature.
May this year, the CBL reviewed proposals submitted in response to a Request for Proposals (RFP), and selected the most competitive bid (Crane AB), based on cost and delivery time.
As a result, the CBL intends to enter into a contract with Crane AB (“Crane”) for the printing and delivery of 4 billion Liberian Dollars banknotes (in L$500 denomination). Under the terms of the contract, Crane will print and deliver the approved amount of banknotes to the CBL in Monrovia in a reasonable timeframe.
On March 12, 2020, the CBL issued a RFP, soliciting proposals for the printing of additional banknotes, with a deadline for responses on or before April 8, 2020. The CBL received proposals from potential currency printing firms in advance of the deadline.
Five internationally reputable currency printing companies were invited to participate in the bidding process. Subsequently, an especially dedicated Procurement Committee for printing of the additional banknotes conducted a rigorous evaluation process of the proposals, focused on both financial and technical aspects against a set of detailed evaluation criteria.
As a result of this process, Crane was recommended by the CBL Procurement Committee as the preferred supplier to print the additional banknotes with the technical advice of U.S.-based Kroll Associates Inc.
The Executive Governor of the Central Bank of Liberia, J. Aloysius Tarlue, Jr., had said, “the CBL will keep the Liberian people fully informed of every step in the procurement process, up to and including the arrival and injection of the additional banknotes into the Liberian economy.”
The US$3.3 billion Liberian economy of US$677 GDP per capita has had prolonged contraction from 2018 at 1.2% throughout 2019 at 1.4% before #COVID-19 hit the economy even harder with possibilities of a severe plummet.
Inflation reached 31.3% by August 2019, up from 26.1% the previous year, according to the World Bank.
According to the Central Bank, printing more money will help address the lingering liquidity problem and provide the Liberian people easier access to the cash they need to pay for food, school fees, health care, and other essential products and services as the country struggles to revive economically.
The Government of Liberia has managed to contain the COVID-19 pandemic with 166 confirmed cases, 58 recoveries and 18 deaths, as of May 5.
By E. J. Nathaniel Daygbor– Editing by Jonathan Browne