Liberia’s president George Weah has announced monetary and fiscal measures to try and bring runaway inflation under control in the poor West African country.
The former football star, who was elected in December on an anti-poverty ticket, said the central bank will inject $25 million into the economy as the Liberian dollar has fallen sharply in recent months, driving prices up.
On Monday, the Liberian dollar was changing hands at around 160 to the US dollar — in June 2017, it was 100 for $1. Both are legal currencies in Liberia.
“We are fully aware that we were elected with the expectation that we will solve these challenges. This is a task that we are now embarked upon with strong determination, focus, and commitment,” Weah told the nation in a televised address.
But Weah, who became president of one of the world’s poorest countries on January 22, said solving Liberia’s economic problems would take time.
“For many decades, we have incurred trade deficits because we import more than we export,” Weah said.
With an economy based on exports such as iron ore, rubber and coffee, shipped raw to foreign buyers without added-value, Liberia was missing an opportunity to create employment, he added.
“Additionally, the prices and demand for our exports are determined and affected by factors beyond our borders, and are therefore beyond our control.”
Inflation in Liberia stood at 21 percent, compared to 17 percent in February, the president said, in an especially hard blow to the country’s poorest.
On top of the cash injection, Weah announced expanded powers for the central bank to regulate money exchange and oversee banks, as well as a review to determine new ways to bring Liberians into the banking system.
The former soccer star succeeded Africa’s first elected woman head of state, Ellen Johnson Sirleaf, who restored stability after brutal civil wars but failed to raise living standards.
Weah sought to set an example at the start of his mandate by cutting his own salary by 25 percent. Then he ordered a 20-percent cut in the price of rice, which is a staple food in Liberia but entirely imported.
In May, he called for a large cut in import duty on more than 2,000 basic goods to help fight the country’s inflation.