Credible reports reaching this newspaper suggest that the ETON and Ebomaf deals, long thought to have been abandoned by this government has, according to sources on Capitol Hill, been resurrected and placed on the front burner by officials of this government. A source at the Finance Ministry told the Daily Observer that no final decision on the matter has yet been made, although there are signs that it may eventually receive official blessings allowing it to proceed.
However, reports say, officials of ETON are still in the country and have been actively seeking to have the Liberian government provide its foreign exchange reserves as collateral for the proposed loan. According to sources, Eton officials have been making the rounds between the Executive Mansion, the Central Bank of Liberia (CBL) and the Ministry of Finance and Development Planning.
A top Finance Ministry source told the Daily Observer that, for weeks now, officials of the Singapore-based company have been engaging Finance Ministry officials in an attempt to secure an arrangement that will circumvent CBL restrictions and place the country’s foreign exchange reserves under the direct control of the Minister of Finance who will, in turn, use his authority to commit the reserves as collateral for the loan.
But, according to the Finance Ministry source, the hitch is, the matter has more to do with monetary policy as opposed to fiscal policy. Fiscal policy according to sources falls almost entirely on the lap of the Finance Ministry whereas, monetary policy falls squarely within the authority of the CBL as outlined in the Act creating the Central Bank of Liberia.
Under Part 4 of the 1999 Act of Legislature creating the Central Bank, the Central Bank of Liberia(CBL) shall have functional independence, power and authority to:
- issue legal tender banknotes and coins;
- administer the currency laws and regulate the supply of money;
- provide credit to bank-financial institutions on a discretionary basis;
- act as fiscal agent for the Government;
- administer the New Financial Institutions Act of 1999 and regulate banking activities;
- regulate bank and non-bank financial institutions, as well as non-bank financial services institutions;
- hold and manage the foreign exchange reserves of Liberia, including gold;
- advise the Government on financial and economic matters;
- conduct foreign exchange operations;
- play an active role in collaboration with bank-financial institutions in the creation and maintenance of efficient and safe mechanisms for payments, clearing and settlements to meet the needs of the financial markets, commerce, government agencies and the general public. The Central Bank shall execute this responsibility through permanent consultations with the bank-financial institutions and through implementation of the proper regulations and standards, as needed.
Further according to sources, ETON officials have paid several visits to the CBL in hope of meeting the authorities to convince them into accepting the loan deal that will cede to their control, the nation’s foreign exchange reserves held in the Federal Reserve Bank of New York. Sources further note that ETON was unable to consummate a deal with the CBL under the watch of former Executive Governor Milton A. Weeks.
Following the departure of Weeks from the Central Bank, according to sources, Mr. Charles Sirleaf, rebuffed ETON officials by refusing to hold discussions with them. But according to sources, the indictment of both Milton Weeks and Charles Sirleaf and their exit from the CBL appeared to have reawakened the interest of Eton officials and they have already recommenced their engagement with the CBL and the Ministry of Finance and Development Planning.
At this stage, it remains unclear whether, CBL Governor, Nathaniel Patray has given his blessing to the deal to have the country’s reserves placed as collateral for the ETON and Ebomaf loan deals. But Finance Ministry sources however say that while Finance Minister Tweah may appear inclined to pursue the deal, it can only be accomplished should the CBL leadership concur.
Meanwhile, text messages and calls placed to CBL and Finance Ministry officials to verify these accounts have since gone unanswered as officials from both institutions have remained tight-lipped on the matter amid a wellspring of heightened public concern about the fate of the loan deals.