Pres. Weah Announces ‘Economic Measure’ to Curb Inflation

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President George Weah speaks during his inauguration in January 2018, said Liberians would not be spectators in their own economy. In his speech this week, However, the President said his government will shortly announce a series of policy measures that are intended to stabilize the economy in the short-term and position it for growth in the medium to long-term.

In the wake of the rising foreign exchange rate of the Liberian dollar to the U.S. dollar, which now stands at L$191 to US$1, President George Weah has announced several ‘economic measures’ to curb the country’s soaring inflation rates which has contributed to increased unemployment, commodity prices, falling real income and the plummeting value of the Liberian dollar.

However, President Weah fell short of announcing any short-term measures that will immediately alleviate the current economic hardship Liberians are experiencing—a move which has angered lots of Liberians.

“My fellow Liberians, I want you to know that I am aware of the difficulties and hardships that the rising exchange rate is causing you; and the effect it is having on prices of all goods and commodities in the market. I am deeply concerned about these issues. I am working day and night to resolve them,” President Weah said on Wednesday, May 29, 2019 when he addressed the nation.

The measures in question, economists explained, if properly implemented, will initiate the country on a new path of growth, employment, and transformation and rebuild investors’ confidence in the country’s banking sector, properly end state capture, and restore good governance at state-owned enterprises.

Furthermore, economists added the measures also can reduce the budget deficit by bringing government revenues closer to expenditures, which made government debate payment easier and demonstrate a government’s fiscal discipline to creditors, and credit rating agencies.

However, the President said his government will shortly announce a series of policy measures that are intended to stabilize the economy in the short-term and position it for growth in the medium to long-term.

“We are working with stakeholders on measures that are intended to bring down prices,” President Weah said. “We are working to attract new investments in agriculture; and we are working to improve our business climate to reduce the costs and hurdles of doing business in Liberia.”

President Weah added that the measures will include introducing salary caps for government workers, and working with the legislators to share the burden as well.

“To achieve this will require sacrifices from all, because our actions will involve reform of our large wage bill; rationalizing government spending to put more resources to critical sectors like health, education and agriculture; improving the way government makes payments to government entities, and vendors who supply the government with goods and services; and some actions on domestic arrears that the government owes local vendors as a stimulus to the economy,” he said.

Other measures, Weah announced is that the budget for the fiscal year 2020 will be based on ‘realistic estimates’ of revenue generated to enable the government to reduce budget deficits, and to undertake realistic projects.

“We are delivering a new and improved fiscal policy that will be announced with the passage of a credible national budget for the 2019-2020 fiscal year. In the last several years, we have passed a budget that exceeds our revenue potential. We are now working together with counterparts in the other branches of government to pass a realistic budget.”

The economic measures announced by the President comes months after an IMF team led by Mika Saito earlier this year, raised the alarm that productive spending is being crowded out by a wage bill, including discretionary allowances; that totals about two-thirds of government-funded expenditure.

“This is not a new issue—it has been a characteristic of the Liberian economy for a number of years. However, as grants and other external assistance declines, this is no longer a tenable situation. Freeing up resources in an equitable manner for Pro-poor development, will likely require effective actions to reduce the share of government resources devoted to this budget item,” the IMF team report said.

On the monetary front, President Weah said his administration will soon start taking actions to instill greater confidence in the CBL and the banking sector at large.

“In this regard, I wish to announce that the Government of Liberia, under my leadership, will no longer borrow from the CBL for its short-term liquidity needs,” Weah said.

He said the integrity and independence of the CBL will be assured and protected under his administration, and this resolve will be critical in the time ahead.

The move by President Weah’s to stop borrowing from the CBL was contained in the IMF report, which stated that without central bank borrowing, financing a sufficient level of public service provision will require policies to prioritize, and improve the composition of expenditure, enhance its efficiency, and expand the resource envelope.

“Increased uncertainty and volatility in the external environment argue for further measures to safeguarding the foreign exchange reserves of the central bank. The creation of a well-functioning monetary policy framework would reduce the need for foreign exchange intervention. Acceptance of greater exchange rate flexibility would help preserve reserve stocks, and absorb external shocks. In addition, reducing the central bank’s operational deficit would be vital,” the IMF report said.

The President announcement also comes a month after top foreign diplomats in a letter called on the government to stop “the so-called borrowing initiative,” which damages donor confidence in government’s use of its resources, and in its ability to serve as an effective partner on development programs.

President Weah furthered added to provide the opportunity for the CBL have a new direction, and therefore, he has accepted the resignation of the Dr. Mounir Siaplay, Deputy Governor for Economic Policy; and announced that Executive Governor Nathaniel Patray is scheduled for age-related mandatory retirement in the next three months.

“During that period, we will work to transition the bank to new management. The new CBL leadership will be recruited by a vetting committee to be established,” President Weah said.

He added, “It will be composed of an independent team of professional Liberians, to be named shortly. Meanwhile, I will also announce a new Board of Governors next week.”

The retirement of Patray from the CBL is in the midst of s serious liquidity crisis, which, and report of systematic flaws in the banking procedures.

It is also reported that Patray is seeking half a million united states dollars as a severance package for retirement.

President Weah said his move is based on the fact that multiples reports on the alleged missing L$16 billion and US# 25 million mop-up exercise like the Kroll, PIT and GAC reports show major lack of systems, and controls at the CBL, which call into question the ability of its present leadership to effectively revamp its internal mechanisms to provide greater accountability and professionalism, so that confidence and credibility would be restored to the institution.

However, the move by the president to replace the entire Board of Governors of the CBL, according to observer, is in violations of the CBL acts part IV, section 13 (1-5) that: “A member of the Board of Governors can be removed from office only by impeachment by the Liberian Senate upon a finding by a majority of the Board of Governors and the recommendation of the President, for any of the following reasons: (a) gross breach of duty; (b) misconduct in office; (c) conviction of a felony; (d) being declared bankrupt; and (e) violation of paragraphs (a) and/or (b) of subsection 1 of Section 13.

“The President may, however, remove a Governor upon a determination by a competent medical authority that he is medically unfit to execute his duties, or is permanently incapacitated.”

“For monetary policy to work, Liberians must develop confidence in the banking sector. Today, most of the Liberian dollars in our economy is outside the banking sector,” the president said. “We are shortly going to announce new policy initiatives that should increase the confidence of Liberians in the Liberian dollar. These policies will provide strong incentives for Liberians to keep their money in the bank and for commercial banks to invest more in the Liberian dollar. economy.”

On fighting corruption, President Weah added his administration will begin reviewing performance and revenues from our state-owned enterprises, ensuring that leakages or inefficiencies do not undercut the ability of government to support its people.

“We intend to intensify our fight against corruption. But as we battle corruption, our fight will be based on the facts and the evidence of corrupt activities that are adduced by reports from audits that have been professionally conducted, rather than mere perceptions and unsubstantiated allegations.

“In the next several days, my Government will begin the review of all GAC audits over the past 10 years, and will commence legal actions against every person that is implicated in these audit reports. Anyone found culpable will face the full force of the law,” President Weah said.

President Weah added in this same spirit, his government intends to contract international auditing and investigative firms to go after all monies and resources that were illegally taken from Liberia over the last 10 years.

“We must all take the fight against corruption to a new level as a form of social justice for all our people,” the president tells Liberians.

19 COMMENTS

  1. Weah doesn’t understand the full scope of his own speech on the economy. When you aspire to wear a shoe that is bigger than your foot, the result is that you repeatedly wobble with every step you take. The only online degree can not help either. He thought the presidency was about rekindling his lost wealth with public funds which is why he quickly built himself 47 storey buildings in less than six of his presidency.

    He has no idea how a government is run and doesn’t understand the functions of the three branches of government let alone the office he is presently occupying. I am just sorry for the country… We are in the worst nightmare since the founding of the country.

    • U are absolutely right , this president does not have the mental capacity/ intellect to understand a government structure or functions , he is clueless even as to the function of his position as president of a nation, my advice to him is being that he’s incompetent he should start hiring people that are competent and experience regardless of thier political affiliation and fire his buddies starting with his minister of state, minster of finance, minister of information, minister of justice and monrivia city mayor. I believe the failure and incompetence of this government is due to the fact that his friends and friends friends including relatives are occupying positions that they are unqualified for and these positions are crucial to the country economic development , that’s one of the reason there is rampant corruption everyday all day , if he can not do that then he should step down as president and probably start coaching some local football team some where in Liberia cause thats what he good at ( soccer)

    • That’s the reason Liberia is the oldest African country but lease develop cause people been patient for far too long , Liberians need to put the patient aside and focus on putting boots on the ground that will bring the country back to life cause this government is 100 % incompetent and things are not going to get better it’s only going to get worst and if Liberians want to sit down and continue to be patient well guess what the masses will end up starving to death cause patient isn’t going to fix anything,

  2. To utter words is costless. Anyone can do it and it costs nothing. Terms like “impressive speech” that we like to shower on our leaders is only a measure of lip service. So until the day it actually happens, these words are nothing but hot, damp air, that soon dissolves in the atmosphere.

  3. Weah’s much awaited speech was read yesterday, 5/29/19. Hopefully, something good will happen soon. Everyone knows that a speech will not cut a slack. In spite of that, it is hoped that Weah will do a whole lot more to get things going economically.

    There’s no doubt that the Liberian economy is going through a difficult time. Sadly, without offering or suggesting common sense solutions, some of Weah’s critics accuse Weah of being uneducated. Weah’s critics tell us that if he were an educated man, the economic hardship wouldn’t exist. I disagree with that view and this is why,

    Ellen Johnson Sirleaf is an educated person. She served as president of Liberia for twelve (12) odd years without properly tapping into her Harvard-trained education. During her presidency, lawmakers were paid huge salaries and were given lucrative perks. But while $120,000-a-year salariy was paid to each lawmaker, public school teachers, University professors, medical doctors and many others were left out of the equation. Of course, Johnson-Sirleaf is very educated!

    Unfortunately, those huge salaries are still being received by the lawmakers. Unfortunately, some public school teachers are not paid properly. Unfortunately, some students who attend public schools do not have their full set of textbooks. No wonder why a majority of the students who recently took the LU entrance exams did not pass. This mess started when Johnson-Sirleaf, the educated president in office. Education pays. But the 6th sense, otherwise known as the common sense is undoubtedly important.

    Liberia’s economic hardship is real. But it was there before Johnson-Sirleaf left office. The economic hardship has nothing to do with Weah’s education. Nothing whatsoever.

    Currency…
    One of the problems in Liberia is the issue of currency. The LD (Liberian dollar) is tumbling faster than a rock. While Johnson-Sirleaf was president, two currencies were in use in Liberia, the USD and the LD. Most Liberians dislike the LD. After the uncivil war which lasted nearly 15 years, it would have been sensible for the USD to have been used for a while before introducing the LD in the monetary system of the country. Johnson-Sirleaf is to be blamed for the economic mess Weah is faced with. Yeah, Weah is the president, not Johnson-Sirleaf. Weah will try his utmost best to improve the country’s economic outlook.

    Apple and orange:
    Nathaniel Patray wants to be given a severance pay in USD. Why not be given his serveance pay in LD?

    Answer:
    The LD is completely worthless. No questions. Because of that, the LD must be phased out and replaced with USD for a ten-year period.

    • Unfortunately the situation in Liberia is not about education it’s about competent, there are a lot of other countries around the world that have uneducated leaders but are doing well simply because there are competent and qualified individuals in the right positions to help the president lead the country in the right direction, having an educated leader is just a plus cause they put in thier own thoughts some times instead of relying solely on thier advisers so to speak but at the end of the day true leaders are born not raise over night .

  4. throughHi F. Hney,

    Review the list and submit your recommendation to our President.

    1) FIBLL stole US $19 million from taxpayers through CBL, according to 2018 KPMG Audit report;

    2) President Weah and other government officials built expensive houses without explanation;

    3) US $104 million unaccounted for;

    4) US $25 million unaccounted for;

    5) US $3 million unaccounted for;

    6) Government shifted US $50M allocated for commodities and used the fund to build roads in voter-rich City (Monrovia); The shift of the $50 million took money from amount allocated for fuel oil, stationery, repair and maintenance, seminars/conferences, etc, thereby, indirectly choking the Liberian economy.

    7) Financial statements, including balance sheet of State-owned entities are not published; and

    8) Government continues to shift the responsibility to produce food to private-capitalists, investors who prefer to invest in lucrative assets such as diamonds, gold, timber, etc.

    The investment in food production would increase saving (i.e., one of the factor of-Current Accounts- that increases appreciation of local currency). When a country’s saving is more than a country’s investment, its local currency appreciates, stated the IMF.

    The International Monetary Fund stated that a country’s saving increases when it increases export and reduces investment in importation.

    More so, government’s investment in food production would increase employment opportunity for many of our unemployed population.

    J. Yanqui Zaza

  5. I read the Pres” economic message with grave interest. He seems to have the will power to improve the the condition of the masses; the heart is willing, but the flesh is weak. We suggest that he forms an intradiscipli-nary team, charging them to come up with programs and projects, with agriculture and rural development as the priority of the government. We have to make agriculture NUMBER ONE! I know what I am talking about. We are still eating the peppers from our garden from last year, and have commenced this year’s crop.

    The SOIL IS A BANK: INVEST IN IT!

    Dr. Coker A. J. George. Jr.

  6. Dr. Coker,
    I am in total agreement with you. The soil is a bank. I will do whatever I can to stop the Liberian people from buying pepper from the Guineans. Now, I don’t want to be misunderstood. Commerce between two loving countries is phenomenal. But, where do the Guineans plant their pepper? In space? If they use their soil in order to plant pepper, I suppose the same could be done in Liberia.

    But don’t tell me where your garden is.

  7. Comrade Zaza,
    It seems to me you have a compendium of vital information that could be presented to Weah. Since you were able to compile such a vital data, why not present it yourself? No, it looks kind of tricky for me to do so. Present the stuff yourself. Come on. Don’t be petrified.

    On a serious note, I agree that our country is going through rough times. Because of that, some kind of stimulus is needed.

    Weah’s critics have no contrasts or common sense solutions to offer. None whatsoever. It’d be preposterous for me to suggest that Weah shouldn’t be criticized. What I suggest is that Weah’s critics should come up with a contrast. In other words, given the current climate of economic uncertainty, how would those very critics solve the problems Weah inherited from Johnson-Sirleaf?
    What do you think?

  8. F. Hney, your posting to Comrade Zaza is not only comical but dawned right silly. To be asking Weah’s critics to come up with solutions to the country’s woes is seem like the familiar joke we heard from Doe and Taylor’s loyalists who opined that their critics had nothing to offer aside from masking their true intents of seeking for jobs through criticisms. The same movies seems to be playing again….

    If Weah can shut down his “boetian ears” and begin to listen to his critics, he will certainly hear from them. But as of now, he has labeled them as mere jobs seekers whose only intents, according to him, are to seek for jobs. You might wonder why our Liberian political movies of stupidity keep repeating itself? Like Doe and Taylor, Weah seems to be trekking the same flawed past.

    Let me restate as a matter of emphasis: Weah can only hear his critics if he chooses to listen and not be dismissing his critics as jobs hunters. He does not own a company to be boasting about others wanting jobs from him. The country is not owned by him alone; it is for everyone. The jobs he is talking about are for Liberians.

    Now, you talked about common sense solutions… One common sense solution is for Weah and his government to begin exercising restraint by controlling their gluttonous appetites—-stay away from converting money that belong to the country to their personal uses. Weah himself has refused to declare his pre-presidency assets but had openly built 47- buildings in just about six months into his presidency. He created within the national budget 1.5 million dollars allotment for his wife.

    The country’s economy is lying in repose of total failure while Weah and his team are having a field day. You, Hney, need to prevail on Weah to declare his pre-presidency assets and then try to listen to his critics and avoid labeling them as jobs hunters.

  9. Jackson Neal,
    I strongly believe that you’ve missed my point. Because of that, you want me and the readers to believe that my retort is “downright silly”. What should be considered whimsical is the suggestion made by Zaza. Comrade Zaza suggests that I should “review the list and submit [your] my recommendation to our president”. Why should I be ordered to do something like that? Well, if I am to do something like that, than it’s fair game for Weah’s critics to tell the nation how they would govern the country if they had the opportunity to govern.

    My response is reasonable. In the US, the democratic contenders for the White House are hammering at Trump’s ineffectiveness. The pundits are counter-punching. Example, the pundits who support Trump tell us that the game or run for a second term by their man is winnable. On the contrary, anti Trump loyalists tell us that irrespective of what, Trump is vulnerable and therefore a loser. While the debate to dethrone Trump rages on, the democratic contenders will present contrasts. In presenting a contrast, a candidate draws a parallel and lets the voters know how she or he will govern differently. That’s not forthcoming from the opposition or the critics!

    I know that Liberia is not the USA. While we are miles apart geographically, we can learn from the USA. If the critics in and out of Liberia do not learn what the world’s most developed country does, we’ll continue to watch the old sad political movies of Liberia. Example, when Taylor ran, the voters didn’t hear any contrast of views from him. Zilch! What was heard resoundingly was “we will vote for you papa. Whether you kill my mama or not, we’ll vote for you yah”. The direct implication of the chants can be interpreted as “so say one, so say all”. So say, so say all is an old cliche of the past. These are modern times. Let’s learn to change. It’s about time that we had changed.

    Lastly, I agree that the nation’s economy is experiencing head winds. It’s a problem for all of us. Unfortunately, Weah’s critics want us to believe that the economy is going south because of Weah. That’s an area of extreme disagreement. The Liberian economy was weak before Weah came to power. Also, unemployment was skyhigh before Weah came to power. Yes, Weah is the president. He must do something. Instead of insulting him, I will suggest common sense solutions. If I have the opportunity to meet him, I will try to suggest my own creative ideas. Not the ideas that were suggested by my buddy Zaza.

  10. I can foresee that the LIBERIAN PEOPLE will recover their own economic system themselves, just as they themselves did with the peace. Liberians do not need any help from inside or outside. Our institutions have been restored. Each day at a time to get rid of troublemakers. Contamination cannot exist in peace. This draws the point that the CAPITAL City, Monrovia, Liberia, West Africa cannot economically sustain when other cities are dusting and bring in germs each day out of the cape to dirty our news and bring back diseases to kill the population again. It you are not born within the Capital city limits or cape Mesurado square miles, get out immediately so that we can clean our own place ourselves. We have some big Government structures still in the area and investors are coming to invest for good living. We got to look clean and main again. If those responsible for keeping the City clean cannot or not capable, we will soon invite the army diggers from the country bush within our limits to do so, or drive dictatorships, greed for wealth plus impunity to their own cities and towns of birth so they can carry their sicknesses. You must get dirty to clean, but yet you must clean yourself when you clean. Cleaning to prevent EBOLA, malaria, and other deadly diseases is the prevention we seek. We must sanitize the Liberian nation instead allowing few flat officials to disrupt the peace we now have. If you have forgotten the Liberian way, we will soon infuse some senses in you instead letting you returning to your corrupt infusion on the 16B or 25M. God will never again allow any War in this nation with chemical or biological weapons or even knives or native weapons. Protest in peace in our City and clean it before and after or face the consequences of impunity or violence. We have our own Judiciary branch, our own Legislative branch, and our own Executive branch. They are each equal in powers. We will not allow one to become more powerful than another. Only one leader at a term. Government offices do not work on Saturdays and Sundays in Liberia. If these government workers within these branches cannot serve the Liberian people appropriately and want to just get in Liberians nation just to steal, corrupt or kill like rebels, we will vote them out or dismiss them as the need be. Before God gives you any more Liberian monies from the Liberian Government, you must keep the peace and sanitize the clean. Protest if you want, but the people of Liberia will no more be held responsible for you trouble. Gone back to silent majority. Do not reply my box. Tell the Liberian people your own. Not me.

  11. Leave those few trouble makers, I am getting my diggers ready for orders from the Liberian people. The Liberian flag does not talk it is flying the right time.
    Gone to silence too.

  12. What does Weah know about economic? I hope he has a very good economic team.
    Let’s wait and see, at the same time, we should not wait too long to see.

  13. Vayoy,
    What on earth do you mean when you say, “we should not wait too long”? A power struggle that could lead to toppling Weah’s government?

    Almost all African countries are fed up with military coups.

    A change of government in Liberia will come about through democratic means.

    Anyone who dreams of a forceable takeover is in a land of fantasy.

  14. The Liberia’s Property Tax System Upgrade (Assumption Analysis):
    When one expresses about decency of taxation, the relationship is more to the development needs of all through improve collections and accurate financial auditing reports for the public. In order to have this modern system work well, the engagement process must involve the Legislative, Judiciary and Executive branches and the final report must match to serve an accurate budget implementation.
    In Liberia today, there could be an imbalance in the process somehow because of the ineffectiveness of the branches. Property taxes are directly related to the domestic sector through ownership; the no ownership is held by the government for future investments to enable the economy generate funds for expenditures or storages.
    What main branch of government could be holding up current revenues? To tell you the truth, one would not know because there are no statistical reports from these branches that directly deal with property. Let me make myself clear here. For an example, if we hold both the legislative and executive branch constant, and use the judiciary to show data on lawyers holding property cases for the last ten years, you will find out that thousands of those cases have not reached a verdict. Why? Because the internal research and auditing process of the judiciary are not working well to report those cases that are pending in terms of property to provide revenues for government. Here you will understand that the law positioned on the books for property revenues is not effective by the executive because the judiciary is ineffective.
    Now, property revenues fund if efficiently manage by the executive (Finance, Lands & Energy, Postal, Public Works and Justice), the economy could realize the flow of monies from the domestic and diaspora to serve all development needs (hospitals, energy, agriculture, infrastructures, education efficient and effective security agencies and et-cetera) which increases development, employment and tourism. When the legislature, executive and judiciary are using share data through research and audit, it will assist in refining our management system to avoid mismanagement and misunderstanding amongst our people and improve the livelihood for all.
    Many internal reasons could be holding up this process but one main reason is that most owners of properties are either within the hierarchy or an affiliate of the past hierarchies and are hiding and not willing to pay their fair share for the development of Liberia’s economy because the ideal properties that are owned, the more you must pay. At this level, property owners will invest directly or indirectly to assure tax payments to government.
    Therefore, there is a strong potential for development but the efficiency and effectiveness of those branches must be paramount to give this economy a better recognition and respect. In addition, those administrative head of the executive must be more creative in assisting the government. There are so many great ways to do this, but you need professionals that know more about tax administration and those that are practically paying property taxes to help the executive management system of those branches. Textbooks research knowledge are fair but the practical experience is the greatest.

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