Growth of Agricultural Sector in 2016 (6.4%) culled from the Liberian Daily Observer Newspaper

     

    Culled from the Liberian Daily Observer Newspaper, Liberia

     
     
    May 9, 2017
     
    Gov. Weeks: “The CBL will establish more Rural Community Finance Institutions that will ensure financial services reach the unbanked population across the country”
     
    As one of its key policy directions this year, the Central Bank of Liberia (CBL) will promote financial inclusion to encourage wider use of its Digital Financial Services (DFS).In a policy statement delivered by Executive Governor Milton Weeks yesterday at the CBL in Monrovia, he said the CBL will implement its Agency Banking
     
    Framework (ABF) to simplify access to financial services from the traditional banking system.
     
    “The CBL will establish more Rural Community Finance Institutions (RCFIs) that will ensure that financial services reach the unbanked population across the country,” he said.Governor Weeks said the CBL, in its efforts to address systemic risk that threatens the stability of the financial system, will work with stakeholders, including the Liberia Bankers Association, the Executive, Legislature and the Judiciary to strengthen fraud and burglary laws and their enforcement mechanisms.
     
    He explained that the CBL will review its policy on remittances from abroad in which 75% is provided to the customer in US dollars and 25% in Liberian dollars to instill confidence in the system.
     
    Governor Weeks said the CBL will encourage an active interbank market to widen the participation in treasury bill (T-bill) auctions to include private firms and individuals to pursue developing a long-term securities market.
     
    Pointing out that the CBL will continue to engage with relevant stakeholders to replace legal banknotes in the economy, he said the bank will strengthen coordination with the Fiscal Authority (FA) to offer more attractive yields on its treasury instruments as a means to create a secondary market and develop additional policy instruments for effective management of excess liquidity.
     
    In an overview of the policy, Governor Weeks said the year 2017 seems promising as the global growth is projected to increase from 3.1 to 3.4 percent on projected fiscal stimulus in the United States, stronger recovery from the Euro, and policy actions by China to rebalance its recovery. “The sub-Saharan Africa growth rate is also projected to slightly increase due to the decision by the Organization of Petroleum Exporting Countries (OPEC) to cut oil production, which in effect will slightly increase oil prices and subsequently boost output in oil exporting economies,” he stated. On the local economy, Governor Weeks said growth is expected to increase from 1.2 percent to 3.2 percent, and “the level of growth is expected to be driven by all the sectors except forestry, which is expected to register a flat growth of 0.0 percent.” He added that the annual growth average of inflation is expected to take an upward trend to around 11.0 percent that is underpinned by the depreciation of the Liberian dollar. “Reverting to a single-digit rate of inflation will largely depend on the behavior of the exchange rate, international oil and food prices and the level of improvements in roads construction and energy supply,” Governor Weeks said.
     
    He said while the country’s real GDP growth in 2016 was negative 0.5 percent, the agriculture sector grew by 6.4 percent in 2016 as a result of gradual improvements in domestic rice and cassava production.He said the inflation average of 8.8 percent in 2016 is expected, based on current macroeconomic conditions, to take an upward trend in 2017 to around 11.0 percent.
     
    Another contributing factor to the increased pressure on the exchange rate, he said, was the decline in personal inward remittances by US$32.1 million (or 5.2 percent) to US$583.3 million during the review period, from US$615.4 million recorded in 2015.
     
    At the end of 2016, total Liquidity expanded by 10.0 percent to L$66,711.9 million, from the L$60,627.3 million recorded in 2015, which was mainly triggered by a 12.2 percent rise in credit to the private sector, he said. Governor Weeks said the CBL remains committed to execute its statutory mandates of maintaining a stable exchange rate and low inflationary environment conducive for a balanced, sustained and broad-based economic growth and development.