The President of Liberia, Dr. George Weah says his government has taken several steps aimed at further strengthening the independence of the Central Bank of Liberia,
In his third State of the Nations address to the National Legislature Monday, President Weah reported that the Central Bank will no longer be a part of the Economic Management Team (EMT).
He indicated that the EMT will hereafter discuss all but monetary policy issues, leaving monetary policy fully to the Board and Management of the Central Bank of Liberia.
“I am pleased to report that, despite salary delays and a tight fiscal situation in fiscal year 2019/2020, the Government of Liberia remained firm in this commitment and did not borrow from the Central Bank of Liberia.”
This defines the separation between fiscal and monetary policy, and we will build on it as a cornerstone to developing an independent Central Bank of Liberia, the Liberian leader told the legislature, amidst cheers.
He stated that he CBL Act has also been revised and submitted to Lawmakers for consideration and passage into law.
This President Weah added, is intended to strengthen the operational independence of the Bank and reinforce its newly developed monetary policy framework aimed at promoting price stability.
Also, he said, to ensure the effective operations of modern payment instruments in the country, the CBL has developed regulations and guidelines for the provision of digital financial services, as well as initiated sensitization and awareness campaign on the use of digital financial services, especially the mobile money payments systems.
The Payment Systems Act is being reviewed with the objective of enhancing the enabling legal framework to support the payments ecosystem, according to the President.
President Weah further stated that the Central Bank is working with development partners to fast track its national switch project that would link mobile money to bank accounts and allow for inter-operation of the different mobile money platforms.
In terms of adhering to effective financial management and monetary policy, President Weah indicated that the Bank was instrumental in the IMF’s approval of a program for Liberia.
Arrangements have also been concluded between the CBL and USAID to hire the services of Kroll Consultancy for a six-month period to improve the Bank’s internal control structure.
“They will also supervise the procurement process and logistical arrangements relating to printing, transport, delivery and release of additional banknotes in the economy through the commercial banks.” He said these measures are intended to further improve the credibility of the Central Bank.
Going forward, “I want to assure you of an improved monetary condition in 2020 and beyond, aimed at promoting a stable macroeconomic environment. My Government will remain committed to non-borrowing from the CBL and non-interference in its operations as an assurance of the operational independence of the Bank.”
CBL he pointed out, will work with relevant partners, including the IMF, to strengthen the financial sector by strengthening the operations of commercial banks, and fast-tracking the digitization of the economy in order to make access to finance easy.
“My Government will support the objective of the CBL to build our International Foreign Reserve, which is critical for protecting our economy against external shocks and vulnerabilities.”