Members of the House of Representatives have passed a resolution for the printing of new family of money for circulation in the Liberian economy.
The resolution, when concurred by the Liberian Senate, will authorize the government, through the Central Bank of Liberia (CBL) to print the amount of L$48,734 Billion in different denominations of L$20, 50, 100, 500 and 1000 banknotes. Minted coins in denominations of L$5 and 10. The printing cost to print the new banknotes is US$45,522M.
"Whereas the CBL, which is the institution responsible for administering the monetary regime of Liberia has requested the printing of new family of bank notes and minting of coins in the amount of L$48,734B with an associated printing cost estimated at US$45, 522M within three years, beginning 2021 to 2023," the resolution is quoted as saying.
According to the resolution, the printing of the new banknotes and minted coins is subject to the following conditions, but not limited to L$20, 50, 100, 500 and 1000 and the CBL shall make the relevant adjustment in the total volume, the cost to be printed and the amount, considering that L$1000 is not to be printed and CBL shall arrange the printing plan, considering the budget of the bank.
The resolution maintained that the CBL in collaboration with the Ministry of Finance and Development Planning shall make available additional funding requires for the full replacement through budgetary appropriations.
It is also stated in the resolution that the CBL shall ensure that there is adequate logistics in place to manage the currency reform process and shall develop a currency management strategy with the reform and strong internal control system.
The resolution furthered that "CBL shall ensure an internal financial and control system audit as well as mitigating measures to safeguard the reform process."
Speaking to reporters, the House's Committee Chairman on Banking and Currency, Montserrado County District 16 Representative, Dixon Seboe said out of the L$48,734B expected to be printed within three years' period, the initial amount to be printed is in the amount of L$35.7B.
Providing justification for the first batch of L$35.7b, Seboe said currently there is L$25.5b in circulation, but considering expansion and the issue with reserve requirement, L$35.7b will have to be printed for mitigating other financial problems.
According to him, the printing of the amount takes into consideration all of the indications including money demand and money supply.
It can be recalled that CBL Executive Governor J. Aloysius Tarlue early last month wrote members of the House of Representatives to approve the printing of L$48.733 billion new banknotes to replace the current family of banknotes including the L$8 billion-plus mutilated Liberian dollars in the market.
In his communication, Governor Tarlue informed the lawmakers that the money requested is needed to address the country's current liquidity demands for three years (2021-2023) and restoring confidence in the Liberian dollars.
"I have the honor to present my sincere compliments and herewith submit to you and the Honorable House of Representatives, Resolution No. BR-02/2021 of the Board of Governors of the CBL about a currency reform proposal for comprehensive replacement of the existing family of Liberian dollars banknotes in three years (2021-2023) for consideration and approval in compliance with Section 23 of the CBL Act. Based on the CBL forecast, the total projected amount of new banknotes to be printed isL$48.733," Mr. Tarlue told the lawmakers in his communication.