Liberia to Re-Introduce Coins

[Pabitra]

After the missing notes scandal, government has tightened the processes and reiterated the issue of coins.

See

https://frontpageafricaonline.com/front-slider/liberia-house-of-reps-amends-central-bank-act-expands-legislative-oversight-on-banks-activities/

[Pabitra]

See

https://frontpageafricaonline.com/business/economy/liberia-house-of-representatives-passes-resolution-authorizing-central-bank-of-liberia-to-print-new-families-of-banknote-in-the-tone-of-l48-7-billion/


Capitol Hill, Monrovia — Plenary of the House of Representatives has finally approved the Central Bank of Liberia's request to print a new family of banknotes in the tone of L$48.7 billion to completely replace the ones that are currently in use within three years, beginning 2021.

The House made the decision on Thursday, in its 19th day sitting following the passage of a resolution through a unanimous vote in plenary based on a motion filed by Rep. Acarous Moses Gray (District #8, Montserrado County).



In the legislative piece named and style 'Resolution 001-2021', the House mandated the CBL to print 20, 50, 100 and 500 denominations, omitting the L$5 and L$10 bank notes.

Excerpt of the Resolution: "Now, therefore, in accordance with the above, the National Legislature, comprising of the House of Representatives and the Senate, hereby authorizes the Central Bank of Liberia to print new family of currency in the amount of Forty-eight Billion Seven Hundred Thirty-four Million as requested and subject to the following conditions..."

The CBL, which is clothed with the authority to administer the monetary regime of Liberia, through its Board of Governors headed by Executive Governor J. Aloysius Tarlue had sought approval from the Legislature to print a new families of banknotes, and minting of coins in the amount of L$48.7 billion (L$48,734,000,000) at a printing cost of US$45.5 million (US$45,522,000). The CBL also requested that the new family should include 20, 50, 100, 500 and 1,000 banknotes, while the Five and Ten dollars denominations should be minted in coins.

However, the House, in the resolution, nullified the L$1,000 banknotes and said that the denomination of bank notes to be printed shall only be 20, 50, 100 and 500. The House, however did not mention anything about the five and ten dollars denominations.

Because of the omission of L$1,000 notes, the House called on the CBL to reduce the printing but did not give a specific amount.

Measures, Precedent to print new Families of Currency

In its bid to not repeat mistakes of the 53rd Legislature in granting the CBL approval that led to the alleged missing L$16 billion hullabaloos, the House outlined several measures that the CBL should put in place before, during and after printing of the new money.

The House charged that the CBL shall make the relevant adjustments in the total volume to be printed, the cost of printing and a less amount of printing cost consideration that the denomination of 1,000 Liberian dollars bank note is not to be printed.

The House further stated that the CBL shall arrange with the printer appropriate payment plan, considering the budget of the bank, and that plan shall be with the Legislative committees responsible for oversight.

It also called on the Legislature, in collaboration with the Ministry of Finance and Development Planning to make available the additional funding in the amount required for the full replacement through budgetary appropriation.

In addition, it called for the CBL to ensure that there is adequate logistics in place to manage the currency reform process, develop a currency management strategy with a reformed and strong internal control system and ensure an internal financial assistance audit as well as risk mitigating measures to safeguard the reform process.

The House also charged the CBL to notify the Legislature of the actual volume and value of currency printed and imported into the country at every interval from 2021 to 2023; adding that the replacement shall only be done through the CBL, the commercial banks and designated financial institutions regulated and supervised by the CBL.

Meanwhile, the Chairman of the House Committee on Banking and Currency, Rep. Dixon Seboe (District #16, Montserrado County), speaking to reporters after Thursday's session at the Capitol, , lauded his colleagues for their overwhelming support to the resolution and said the printing of the new family of banknotes will bring a great relief to the country's economy.

Rep. Seboe revealed that the initial money to be printed by the CBL will be over L$35.7 billion, adding that the decision to print such amount is triggered by various indicators such as the demand and supply for money, among others. He noted it is also intended to ensure that over the space of three years, such demand and supply for money would be under control.

In February 2021, the CBL requested the 54th Legislature to approve the printing of L$48.733 billion new banknotes to replace the current family of banknotes including an L$8 billion-plus mutilated Liberian dollars on the market.

In a communication to the House, the CBL, through Executive 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 wrote in his communication.

The bank then outlined that L$35,769 billion will be printed in 2021 (at a cost of US$39.693 million); L$7.536 billion in 2022 (at the cost of US$3.630 million), and L$5.402 billion in 2023 (at a cost of US$2.199 million) to meet the current and medium-term currency demands.

The CBL request to print a new family of banknotes comes amid an acute shortage of local currency in the banks, forcing tellers to restrict daily withdrawal, something that continues to anger customers and sometimes leaving them stranded.

The request was also in line with President George Weah's recent appeal to legislators in his 4th Annual Message on January 25, 2021 to act swiftly to resolve the situation before the next season of high demand for cash.

The President pleaded with lawmakers to quickly approve the printing of a new family of Liberian banknotes to rescue the liquidity pressure on the Liberian dollar which is he termed as an aggravated increasing demand for the local currency.

"In the face of this liquidity situation, and while we endeavor to encourage our citizens to sustain the wider use of mobile money for transactions, the Executive will intensify consultation with the National Legislature to pursue currency reform, to promote monetary policy credibility and enhance confidence in the economy," President Weah said.

The communication has been sent to the Liberian Senate for scrutiny and possible concurrence.

[eurocoin]

There is actually no mention in the article of whether the 1, 5 and 10 dollar coins that were planned will still be minted. As I remember, there was opposition against the minting of the coins as the cost of minting them was higher than their face value. So the plans for coins may well have been dropped.

[Pabitra]

CBL did not propose L$1 coin but only L$5 and 10.

Cost of minting depends on physical specifications and mintage quantity.

L$5 is still more than three times the exchange value than NPR1, work for minting which was recently awarded ( March 2021) against global tenders.

If WAMA ( West African Monetary Agency ) adheres to its plans then Liberia may not need to issue any coins since it is part of ECOWAS.

[eurocoin]

No, CBL also proposed an L$1 coin. I see no evidence whatsoever that production of L$5 and L$10 coins has now been approved.

[eurocoin]

The minting of the coins with denominations of 5 and 10 dollars has in the meantime been approved by the House of Representatives. Only the Liberian Senate now still has to approve it. There was also decided that no currency production will take place in 2023, as that is an election year.

[eurocoin]

The first new Liberian banknotes will be released in December. It is unknown whether then also the new 5 and 10 dollar coins will be released.

[eurocoin]

Based on local media reports, it appears that the designs of the coins and banknotes were made by CBL in conjunction with Kroll. A competitive tender still has to be held for the production of the coins.

[eurocoin]

Liberia: CBL Currency Changeover Remains On Course

The Central Bank of Liberia (CBL) reassures the public that the introduction of the new family of Liberian currency remains on course. In addition to the first batch of L$4.0 billion of the new L$100 banknotes that are gradually being injected into the economy largely through the commercial banks, which began in December 2021, the CBL, working with international partners, is proceeding with arrangements for the delivery of the second L$4.0 billion new L$100 banknotes in January 2022 to begin the gradual replacement of mutilated banknotes, as well as concluding the procurement process for the printing and minting of the remaining new banknotes and coins.

[eurocoin]

From President Weah's annual message:

MR. SPEAKER:

As part of the currency reform approved by you, the members of the 54th National Legislature, the Central Bank of Liberia brought in the first consignment of banknotes totaling L$4.0 billion Liberian dollars out of the approved L$48.734 billion Liberian dollars in November 2021.

The second consignment is expected in January 2022. The first and second consignments are all denominated in 100 dollars bills, only intended to respond to the liquidity demand in December of last year and to commence the replacement of mutilated banknotes respectively.

The bulk of the new currency, which will include coins, is expected in the second half of 2022, while the balance will be coming in 2024. In compliance with the restriction of the Joint Resolution of the National Legislature, there will be no printing or delivery of the new currency in 2023, even though the exchange exercise will continue through 2023.

In the interest of transparency and credibility, the Central Bank of Liberia has ensured that the process is inclusive of our National Legislature, media community, the Liberian Marketing Association, the Liberia Business Association, traditional elders and youths, as well as our international partners, including the IMF and Kroll through USAID.

[eurocoin]

CBL's Competitive Process for Supply of Banknotes and Coins Produces Substantial Cost Savings – A Win for Liberia

The U.S. Embassy in Monrovia congratulates the Central Bank of Liberia (CBL) on the successful completion of a competitive and transparent process for selecting vendors to supply a new family of Liberian dollar banknotes and coins.

Leveraging technical assistance provided by the United States Agency for International Development (USAID), CBL's Board of Governors, management, and staff designed and implemented a procurement process that attracted competitive bids from leading international suppliers. The selected vendors will produce and deliver more than L$40 billion in new banknotes and coins in 2022 and 2024 to replace the domestic currency in circulation, address the liquidity problem Liberia currently faces, and provide the Liberian people easier access to cash. Thanks to its use of international standards and best practices, the CBL is supplying technically-sound banknotes and coins at the best possible value.

USAID Liberia Mission Director Jim Wright hailed the "competitive procurement efforts of the CBL," adding that "they should stand as a model for government procurement in Liberia." CBL Executive Governor J. Aloysius Tarlue commended the government and people of the United States for their assistance and noted "the importance of public confidence in the Central Bank to facilitate its role in growing the Liberian economy and creating jobs and economic opportunities for all Liberians."

Governor Tarlue acknowledged the level of knowledge transfer and capacity-building USAID's technical support brought to the CBL, which, along with additional technical support from the International Monetary Fund (IMF), placed the Bank in a better position to effectively conduct and manage the currency changeover process going forward as well as future currency procurement.

The competitive procurement marks the closeout of USAID's two-year-long technical assistance program to help the CBL more effectively perform some of its core functions, especially the management of the Liberian currency and creating the necessary monetary stability for broad-based and inclusive economic growth. In addition to the current competitive procurement of more than L$40 billion, USAID supported the emergency printing of L$4 billion in L$500 banknotes that arrived in Liberia in July 2020 to help ease the liquidity pressures in the country. In 2021, USAID supported the procurement of an additional L$8 billion to further address short-term liquidity needs.

The first L$4 billion of new L$100 banknotes arrived safely in December 2021, and the second L$4 billion is scheduled for February 2022. USAID congratulates the CBL for its successful currency procurements over the past two years, and although USAID assistance is ending at this time, the U.S. Government will continue to provide technical support to the CBL through other channels. USAID remains a close partner of the CBL and an advocate for continued transparency and competition in all public procurement in Liberia.

[eurocoin]

The Central Bank of Liberia did not reply to questions about which companies won the procurement process. As they had been responsive only very recently, I can only assume that they do not wish to provide the information. The Liberia department of the United States Agency for International Development (USAID), that closely cooperated with the central bank during the procurement process, did not wish to provide the information and only referred me to the Liberian Central Bank, which they felt was more appropriately positioned to comment.

A very "transparent process" indeed..

[Jostein]

It seems that the new coins of 5 and 10 dollars will come with a completely new series of coins that includes 1 dollar, 50 and 25 cents...minted by the British Royal Mint. You can reed it here.

[<k>]

So 25 cents will be the lowest denomination. How many other countries have such a system? Calling Pabitra!

So what will the themes be? Probably updated portraits of Liberian historical heroes.


Now we need to update these topics below with a simple list. Countries that only use other countries' coins and banknotes should be included at the end.

Countries with their own banknotes but without their own current coins

Countries without their own currency

[<k>]

I think we can do without any more animals on coins, unless some unusual species are chosen (e.g. hyena, serval).

See: Analysis of animal species featured on African circulation coins