The Executive Governor of the Central Bank of Liberia (CBL), J. Aloysius Tarlue, Jr., has said that unless additional Liberian dollar banknotes are printed the country will continue to experience a rapid increase in the mutilation of existing banknotes. The lifespan of the enhanced and legacy banknotes, the CBL Executive Governor noted, is three years, hence the need to print additional banknotes.
Speaking recently during an Executive Session at the House of Representatives, Executive Governor Tarlue said, “Central banks in many countries have their own currency in surplus to timely replace mutilated banknotes, but Liberia doesn’t. The CBL would therefore work with other relevant authorities of the government to sustainably handle this problem.”
The CBL Executive Governor disclosed that the L$4-billion banknotes recently secured by the CBL in July was only intended to ease the liquidity pressure for the Independence festive season; henceforth, inadequate to address future liquidity needs of the country. The Governor said about 37 percent have been infused into the economy, mainly through commercial banks, with value amounting to L$1.5 billion dollars.
Executive Governor Tarlue further said the CBL met with commercial banks to inquire about complaints as to why customers are not being served the L$500.00 denomination, even though the CBL had made available the banknotes. “The CBL will continue to gradually make available the remaining banknotes, consistent with cash demands largely by commercial banks,” Executive Governor Tarlue assured the lawmakers.
With concerns about why only series of banknotes was printed, Executive Governor Tarlue further said the L$500.00 denomination was selected and printed due to budgetary constraints. The cost for printing the L$500.00 banknotes, he noted, is lower than the printing of smaller denominations.
The Executive Governor informed members of the House that the bank, through its Board of Governors, is exerting all efforts to sustainably address the liquidity situation. He implored the House to work with the CBL in expediting the procurement process that would lead to the printing of additional denomination of banknotes.
Executive Governor Tarlue and his team were invited by the House of Representatives to explain why the recently printed L$500.00 banknotes are not visible in the economy, and the continued supply of mutilated banknotes by commercial banks to customers, despite the printing of L$4-billion banknotes last July.
The Governor was accompanied to the session by the Deputy Governor for Economic Policy, Dr. Musa Dukuly; the Director for Research, Jefferson S. N. Kambo; the Director for Regulation & Supervision, Fonsia M. Donzo, Mussah A. Kamara, Senior Technical Advisor to the Governor; Bushanda George, Chief of Staff; and the Head of Communications, Cyrus W. Badio.