27 April 2011

Liberia: Money Flight Reversed

The previous trend in the economy, which showed that more money was leaving the country than coming in, is being slowly reversed, the Central Bank of Liberia indicated in its 4th quarter report.

According to the Bank's 'Financial & Economic Bulletin," total remittance inflows, which means money coming into the country, amounted to US$288.5m, a 21.8% increase over the 3rd quarter of 2010.

The Bank said this also shows a 34.0% increase over the remittance inflows of the 4th quarter of 2009, which stood at US$215.3 million at the end of December 2009.

It is said that a percentage distribution of the inflows for the 4th quarter shows that exports accounted for 17.4%; workers' remittance, 33.4%; service payments, 13.9%; official transfers, 5.0%; grants, 29.1%; and investments, 1.2%.

Conversely, total remittance outflows, meaning, money leaving the country, for the same period amounted to US$245.3 million, which signifies a net inflow of US$43.3 million, which primarily came about due to increased workers' remittance inflows.

According to the report, a breakdown of the total outflows indicates that imports accounted for 66.3%; workers' remittance outflows, 18.3%; service payments, 10.6%; official transfers, 4.5%; and investments, 0.2%.

Regarding other aspects of the economy, the Bank said the Government registered excess revenue over expenditure to the tune L$2, 055.1 million, about 3% of GDP. It said total revenue and grants realized during the 4th quarter was L$7, 886.1 million, about 11.5% of GDP and 51.7 % higher than the 3rd quarter.

It puts the total Government expenditure during the quarter to L$5,831.0 million compared to L3, 184.8 million in the previous quarter, meaning, the Government spent more money in the 4th quarter of 2010 than in the 3rd quarter.

Concerning the amount of Liberian dollar in circulation at the end of the 4th, the report says it was LD5, 550.6 million, a 21.1% increase over the 3rd quarter amount, which stood at L$4, 583.7 million.

It is reported that the increase in the Liberian dollars in circulation occurred because there was a 31.9% growth in currencies outside the banking system. The amount was L$3, 795.9 million at the end of the 3rd quarter but increased to L$5, 007.9 at the end of the 4th quarter.

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