The Central Bank of Liberia (CBL) has completed formalities and will make available to customers the new Liberian dollar banknotes next month, the bank’s Executive Governor Milton Weeks told President Ellen Johnson Sirleaf last week.
The CBL had earlier announced that, in keeping with its statutory mandate to ensure the integrity of the Liberian dollar, the CBL will shortly introduce a new series of banknotes into the Liberian economy, with specific reference to the introduction of a L$500 denomination.
Though the existing denominations will maintain their respective portraits, however, the CBL said it has enhanced their security features, which are both visible and invisible. The new banknotes are printed on a higher quality substrate to guarantee longevity and reduce porosity.
Governor Weeks presented President Sirleaf with a specimen of the new notes, including L$5, L$10, L$20, L$50, L$100 and the new L$500, at her Foreign Ministry office in Monrovia. He said mutilated banknotes will be removed from circulation.
The Governor told the President that the new banknotes are guaranteed with features that cannot be easily duplicated. He lauded the President for the level of support he has received since his appointment.
Gov. Weeks was recently appointed by the President to succeed Gov. Mills Jones, whose tenure expired in February 2016.
The newly upgraded denominations contain portraits of ordinary Liberians on the front, and Liberian wildlife on the back. The CBL’s pronouncement about the new banknotes had earlier invoked a barrage of criticisms, with many expressing fear over the motivation for the decision.
Critics, some of them experts, say there is no financial and or economic theory supporting the bank’s decision to print new banknotes to replace ‘damaged’ banknotes and to increase the supply of money in a market.
They argue further that there is no justification for the CBL to increase money supply in the economy when the currency is already inflated. One of those critics is Dr. Somah Paigar, an economist and Vice President for Administration (VPA) at the African Methodist Episcopal University.
Dr. Paigar is also a former chairperson of the National Investment Commission (NIC). He said “The country is experiencing inflation – as there an increase in prices and fall in the purchasing value of the Liberian dollar. Commodities prices are rising on a daily basis and I’m beginning to think that the printing of the new notes are definitely for different purposes, but not for monetary purposes.”
He said the printing of the L$500 denomination is difficult “to comprehend in the midst of economic and financial difficulties that the country is currently facing.”
But Governor Weeks at a recent interview said there is no sinister motive behind the CBL’s decision, that it is a purely monetary decision. He wondered how the printing of money, which is the mandate of the bank, would cause inflation.
He doubts the possibility of hyperinflation as some are claiming. “Those who are putting forth this argument are yet to convince me how the printing of new notes or a L$500 denomination would lead to inflation,” Weeks said. He said the L$500 is meant for portability. “We have printed this denomination for nothing else, but for people to be able to carry huge cash easily,” he said.
President Sirleaf, upon receiving the specimen, lauded Dr. Weeks and his team for what she termed as hard work and the level of professionalism at the CBL since he took over.
Also present at the presentation ceremony were Vice President Joseph N. Boakai and Senate Pro-Tempore Armah Jallah, who also made separate remarks.
The two senior government officials lauded the Governor and his team for the initiative while also admonishing them to create more awareness on the handling of the new notes.