One of the Senators who proffered the motion for the passage of an amended Act that limits the mandate of the Central Bank of Liberia (CBL), has explained that the Legislature made an error when it allowed some of its Constitutional functions to be taken over by the Bank.
“Our earlier action might have been done in error; to correct this we have reserved the authority to print currency to the Legislature,” said Senator Armah Zulu Jallah, one of the brains behind the amended Act.
Making further clarification, Sen. Jallah explained that the Constitution did not give the Legislature power for it to be shared, and that the Senate was rightly correcting its oversight.
Senator Jallah, who chairs the Senate Committee on Internal Affairs, said the passage of the Bill is to ensure that the CBL is depoliticized and remains the autonomous institution it was intended to be.
The Gbarpolu County lawmaker said while the Legislature succeeded in ensuring the CBL remains autonomous and non-political, it failed to ensure that the Bank was depoliticized.
“Today what the Legislature passed is a milestone to ensure that the CBL will be depoliticized,” Senator Jallah declared.
The apparent bad blood between the Senate and the CBL— which is gradually approaching the boiling point— started last March when the 53rd Senate in their 2nd session started to question the authority of the Bank to give loans to non-banking groups such as credit clubs, marketers and wheelbarrow boys.
In order to legitimize their argument that the CBL was at fault in giving out loans to non-banking institutions, the Senate through its committee on Banking and Currency in April invited legal and financial local luminaries to give expert opinions on the activities of the country’s national treasury, with respect to its Constitutional mandate and statute that created it.
Former Solicitor General of Liberia, Cllr. Wilkins Wright, citing Constitutional provisions, told the hearing in the Chamber of the Senate that the Bank was in violation of the Constitution by giving out loans to non-banking institutions outside its Legislative statute.
He then suggested that if money used by the CBL in its loan-giving program is from the national treasury, that translates into commercial banking, which is a violation of monetary laws.
“It is not right to do commercial banking and at the same time regulate yourself,” he explained.
At that hearing, Cllr. Wright also called for the general review of the CBL Act to help clarify some “ambiguities,” such as reducing the duties of the CBL Governor.
In apparent adherence to that suggestion, the Senate through some of its members presented to the plenary a Bill calling for an amendment to the Act that established the CBL with the sole intention to curtail some of its functions.
The political ban on CBL officials is yet to be explained.