It can be recalled that in the first in the series of policy issues raised by the Liberian People’s Party (LPP) on 25th October 2021, we asserted the following: “Additionally, the records show that the Liberian dollar supply was valued at LD19 Billion as of 31 March 2021 (LD41 Billion minus LD22 Billion dollar outside of the banking system).
The Central Bank of Liberia 2020 Annual Report, issued on 31 March 2021, has information on the total “Broad Money” supply and the total Liberian dollar supply. On pages 39 and 40, the CBL Annual Report shows that the “Total Broad Money” (M1 & M2) stood at LD127 Billion; of that amount, LD85 Billion was in United States Dollars and LD41 Billion in Liberian Dollars; of the LD41 Billion, it is reported that LD22 Billion is outside the banking system, thus leaving LD19 Billion within the banking system. So, how does the CDC Economic Management Team explain the scenario of the persistently frequent syndrome of no Liberian dollars or severely mutilated Liberian notes in the CBL and commercial banks?
So, the Central Bank of Liberia (CBL) records show that LD19 Billion was within the banking system, but well-informed sources suggest that the reason why there is no Liberian dollars or severely mutilated notes in the banks is that CDC big shots and their cohorts have stashed away the huge volume of the missing 16 Billion Liberian Dollars in their various homes and the homes of their concubines, awaiting the slightest opportunity to launder (clean) said dirty, stolen Liberian dollars and try to legitimize same into authentic assets in banking institutions; hence, the shortage of Liberian dollars on the market, thereby spurring the current sharp decline in the standard of living for the average person, quite contrary to the “Pro-poor” claim of President Weah.
The International Monetary Fund, Liberia’s premier economic adviser is not only silent on important economic issues such as the L$16 billion missing sagas, but it continues to present rosy economic pictures of Liberia. Let us review some of the statements IMF made:
- A) Under IMF Press Release No. 20/386 on page # 1 of the IMF Report No. 21/9 issued on January 2021, Liberia’s economic adviser stated that: (1) Government economic policy was loosened to meet humanitarian needs, it has improved financial management, the policy has reduced prices, including fuel prices, and it has reduced spending by not borrowing money from the Central Bank of Liberia.
- i) Is it true that government did not borrow money? No, it did borrow money from commercial banks. How did it borrow the money? It borrowed money by selling treasury bills and treasury bonds to commercial banks. “…Page # 47 of the Central Bank of Liberia 2020 Annual Report stated that “… the total unredeemed T-Bills and T-Bonds for the review period stood at L$7.53 billion and US$65.93 million… in various tenors (2-weeks, 1-month, 3-months, 6-months, and 12-months).
- ii) Is it true that our government has improved financial management? Our government did not follow the 2009 PFM Law, according to the June 2021 Report of the State Department of the United States of America. In its report, it stated, “…during the review period, the government did not make its budget documents, including the executive budget proposal, enacted budget, and end of year report, publicly available in a reasonable period.”
iii) Moreover, our Liberian experts erroneously did not record within the budget proceeds from the sales of the unredeemed T-bills and T-bonds of L$7.5 billion and the US $65.93, according to page # xii of the Special Budget FY2021.
Was the IMF correct to re-state that inflation reduced from 23% in September 2020, to 14% in January 2021, according to page # 6 of the IMF? Our economic Team stated that “Inflation is down from 23% in January to 14% in September, and now, it is around 8%. What is inflation? It means that prices are going up. And when prices are going down, it is called deflation.
- i) If inflation is declining, why Liberia’s Nominal Gross Domestic Products have increased? The Nominal Gross Domestic Products for 2020 year-ended was US$1.4, according to page # 28 of the CBL 2019 Annual Report. However, according to page # 31 of the 2020 CBL Annual Report, the Nominal Gross Domestic Products for 2020 increased to USD 3.06.
- ii) How come experts of the IMF did not question the different Nominal Gross Domestic Products numbers (USD 1.4 billion reported in 2019 and USD 3.06 billion reported in 2020) for the same year-ended 2020?
iii) The increase in Liberia’s Gross Domestic Products number is not a mistake. This is because a higher number used as the determinator in calculating Liberia’s ratio of debt to GDP will give a picture that Liberia has more room to obtain more debt. Let us look at an example. If you divide Liberia’s debt of USD 1.5 billion by USD 1.4 billion, the ratio is above 107%. On the other hand, if you use USD 3.08 billion as the denominator and USD 1.5 billion as the numerator, the ratio is 36%.
- iv) Remember, Government officials want to borrow money and IMF experts want to lend money to the government. They are aware that Liberian Lawmakers might not approve any additional debt if Liberia’s debt to GDP ratio is high.
- v) IMF experts did not use the correct Nominal Gross Domestic numbers, rather they used the higher Nominal Gross Domestic Products in calculating the ratio of revenue to gross domestic product, etc., according to IMF Country Report No. 20/386.
President Weah Administration, unable to generate revenue and replace the L$16 billion with receipts, is now searching for ways and means to borrow money. Therefore, it has computed a higher denominator to convince Liberian Lawmakers and other stakeholders that Liberia has more room to borrow money.
But we in LPP are sounding out an unequivocal warning to President Weah and his henchmen that we shall not countenance any criminal attempt to legitimize the theft of the Liberian people’s 16 billion to sneak into their fat bank accounts. The LPP-led Administration, coming to power in 2024, shall hold any persons criminally culpable to account in keeping with the full force of the law.”
Signed: Yanqui Zaza, Chairman Liberian People’s Party
Main Photo: Yanqui Zaza