Should Liberia Dump the USD and Stick with LRD


By Paul Columbus Collins, PhD



The Perspective
Atlanta, Georgia

July 13, 2016

                  



 

 
 
 
 
Liberian Currency

It has been reported that a bill is circulating in the national legislature that seeks to make Liberia a single currency (Liberian dollars) economy, a move from the current dual currency regime where both the United States dollars and the Liberian dollars are used jointly as legal tender. This move appears to have been stimulated by criticisms proffered by some renown Politicians, Economists and financial experts who blame the declining Liberian Dollar (LD) against the USD on the dual currency regime, arguing that the Central Bank of Liberia (CBL) hands are tied as it (CBL) does not have control over monetary policy as it should, considering that the dominant currency (USD) is a “foreign” currency. 

Local perception surveyed also seems to be fueled by political reasons, with some Government opposition believing that corrupt officials are sending the USD out of Liberia to support their families abroad, while others are saving millions of USD in foreign accounts abroad, thus creating serious capital flight that is exacerbating the demand/supply structure of the dual currency regime to the detriment of the LD.

This article aims to stimulate further debate on the issue, following a brief summary look at some of the arguments in favor of and against the dual currency regime.  It begins with the history of currencies in circulation in Liberia, a review of dollarization, and a review of the pros and cons of the Liberian case.
History of Currencies in Liberia

 

U.S. Dollar

West African Pound

Liberian Dollar Coins

Liberian Dollar Notes

1847 – 1850s

X

 

X

 

1850s – 1880s

X

 

X

X

1880s – 1912

X

 

X

 

1913 – 1943*

X

X

X

 

1944 – 2000**

X

 

X

X

2001 – present

X

 

 

X

*The West African pound was legal tender during this period, replaced in November 1942 by the USD.
**Liberian dollar notes were issued at par with the USD by Charles Taylor during the 1989-97 civil war, while “Liberty” dollars was issued in areas controlled by ECOMOG in 1991 to invalidate notes looted from the central bank, effectively creating two local currency zones.
(Dedollarization in Liberia—Lessons from Cross-country Experience, IMF Working Paper WP/09/37 by Lodewyk Erasmus; Jules Leichter; and Jeta Menkulasi, March 2009)

From the table above, Liberia has clearly always had the USD in circulation, even when attempts were made to create and use its own currency.  President Samuel Doe minted LD coins in the 1980s; JJ Roberts banknotes were circulated from 1989 and used mostly in the Taylor controlled areas; while the Liberty LD banknotes were circulated in ECOMOG controlled areas of Liberia as of 1991.  Even though both LD banknotes were issued at par, the struggle (characterized by fluctuations and the creation of a parallel foreign exchange market or blackmarket) to maintain the peg to the USD was abandoned in January 1998 and the exchange rate with the USD was devalued from LD$1/USD$1 to LD$43/USD$1 to mirror the prevailing rate in the parallel market.
When a country uses another country’s currency, officially (full dollarization) or unofficially (partial dollarization), we say that country is dollarized.  The main reason for dollarization is to receive the benefits of greater stability in the value of a foreign currency over a country’s domestic currency.

Dollarization usually occurs in developing countries with a weak central government or an unstable economic environment. For example, the citizens of a country within an economy undergoing rampant inflation may choose to use a historically stable currency, like the U.S. dollar, to conduct day-to-day transactions, since inflation will cause their domestic currency to have reduced buying powers. Zimbabwe in 2009 abandoned its local currency because of hyperinflation, and became dollarized, which led to financial stabilization and growth in commerce and services (Kudakwashe Munsaka, How dollarization has contributed to the Zimbabwean Economy, March 28, 2014).

Unofficial dollarization means that citizens prefer the foreign currency for some transactions, although it may not be legal tender. Official dollarization means that the foreign currency becomes the preferred tender within the country, while the domestic currency may also be accepted. 

The usual reason for dollarization is to substitute a more stable currency for a less stable one. Dollarization frequently involves the United States dollar, although it can be based on other currencies, such as the euro.  Some highly dollarized countries include El Salvador, Ecuador, the Marshall Islands, Cambodia, Micronesia, Panama, Turks and Caicos, Palau, East Timor, San Marino, Montenegro, Kosovo, Kiribati, and the British Virgin Islands.

An economy is considered highly dollarized if the ratio of foreign currency deposits to broad money (currency substitution) exceeds 30 percent. In Liberia, this ratio was 70.5% percent in 2015 (CBL Annual Report 2015).  Additionally, when residents choose to hold foreign rather than domestic denominated monetary assets as stores of value, this can lead to dollarization. This is however not surprising considering that the main currency in Liberia has always been the USD.  Contrast this with Ghana, where the ratio of foreign currency deposits to broad money is a little less than 30% (but climbing because of the instability of the cedis).  My point here is, different countries have varying degree of dollarization.

Adopting a foreign currency as a legal tender entails costs and benefits. The IMF Staff Paper WP/10/106 by Luis I. Jacome and Ake Lonnberg (April 2010) summarizes the costs associated with official dollarization as:

Seigniorage is profit earned from printing one’s own currency.  Liberia does not earn seigniorage from the printing of the USD, but Liberia does earn seigniorage from printing LD.  Hence, this cost is mitigated to a degree. On the cost of LOLR, it may not be applicable to the Liberian case because the CBL does have prudential measures including reserve requirements in place that enable it to provide lender-of-last-resort assistance to troubled banks. Again, the CBL actively participates in the forex market using its reserves of USD to absorb shocks to the forex market.  These costs are therefore more relevant to a country that is fully dollarized AND does not have its own currency in use alongside the foreign currency.

The IMF staffers also articulate benefits of officially adopting dollarization as

Liberia’s inflation over the last three years have been averaging around 7%, compared to Ghana where the inflation rate has been averaging 18% annually, or Sierra Leone where the inflation has been averaging 8%.  With the dominant currency (USD) mostly stable, Liberia appears to be positioned between two worlds, accruing some benefit from dollarization while experiencing mitigated cost of dollarization due to use of a domestic currency alongside the USD.

De-dollarization is the flip side of dollarization, where a country returns to its domestic currency and eliminates the use of the foreign currency.  During the past decade, Bolivia, Paraguay, Peru and Uruguay introduced different prudential measures to de-dollarize, by lowering banks’ incentives to borrow and lend in foreign currency, as well as to diminish agents’ preferences for using foreign currency as a means of payments.  As dollarization rates declined (and hence, vulnerabilities associated to financial dollarization were contained) and preconditions of macro-stability were in place, monetary authorities seem to have had a greater tolerance for exchange rate volatility in some of these countries.  De-dollarization has followed the successful implementation of macroeconomic stabilization policies, which have resulted in low inflation, anchored inflation expectations, gradual appreciation of the currencies, and generally stronger fundamentals. 

There was therefore no forced de-dollarization; instead, there was a deliberate policy to adopt market driven de-dollarization, with Government policy aimed at influencing the economic indicators to support the process of de-dollarization.

Luis A. V. Catao and Marco E. Terrones (IMF Working Paper WP/16/97, April 2016) write that amidst striking heterogeneity (diversity) of patterns across regions, they had identified a broad global trend towards financial sector de-dollarization from the early 2000s to the eve of the global financial crisis of 2008–09. However, since then, according to their study, de-dollarization has broadly stalled or even reversed in many economies. This is because rather than adopting a market driven approach to de-dollarization, these countries attempted to de-dollarize forcibly or abruptly, through administrative means.  This method is always prone to create shock and panic in the economy that can immediately erode economic stability in the country.

Liberia is a high import dependent economy, with a balance of payment (BoP) position that appears to be deteriorating year on year.  This basically means that we are buying practically more goods and services from abroad than we are selling to residents abroad.  In order to buy more foreign goods and services, we are demanding more foreign currency in order to finance our purchases abroad.  In 2014 the BoP was a deficit of USD38.2m; in 2015 the deficit climbed to USD51.8m.  Gross foreign reserves in 2015 in months of import cover was 2.7 months, lower than the West African Monetary Zone (WAMZ) minimum requirement of 3 months import cover. 

Disaggregating the BoP, the current account deficit according to CBL 2015 annual report was USD 1,974.6m. As a percent of GDP, the current account deficit averaged 96.2 percent in 2015, from 93.1 percent in 2014.  Preliminary statistics show that the trade deficit widened by 30.7 percent to US$1,977.7 million in 2015, from US$1,513.1 million during the preceding year, led by 55.8 percent decline in export receipts coupled with 6.5 percent rise in import payments.    

Liberia imports almost everything, and exports mostly iron ore (54% of exports) and rubber (19% of exports).  Earnings from exports really do not get repatriated to Liberia, but are deposited into accounts abroad that are owned by the concessionaires who export our raw materials.  This means we really do not generate much foreign exchange or revenue from exports because those revenues are owned by foreign agents who keep their revenues in their home countries. 

On the other hand, we spend USD 2,237.2m on imports.  In my opinion, these imports were largely funded not by our exports for reasons explained in the preceding paragraph, but from transfers which registered a net inward surplus of US$1,542m and net inward personal remittances of US$368.4m (foreign investments also accounted for US$878.1m).  

However, in Liberia, we still blame the depreciation of the LD on the presence of the USD, rather than on the weak economic fundamentals, such as failure to improve the balance of payment; failure to improve our terms of trade; and failure to reduce our reliance on imports, even for feeding ourselves.  One proponent of the need for Liberia to de-dollarize blames the depreciation of the LD on dollarization, arguing that there is a negative correlation between the level of dollarization and the exchange rate between LD and USD (Analyzing the Economic Impact of Liberia’s Dual Currency Policy, A View From the Low-Level Square-table,  Wonderr Koryenen Freeman, The Perspective, Atlanta, Georgia, February 26, 2015).  Mr. Freeman claims this “negative correlation” without demonstrating the causal (or cause-effect) link between the level of dollarization and the exchange rate. 

On January 15, 2014, The New Republic reported that Representative Eugene Fallah Kparkpar had said in an interview granted the paper that the use of dual currencies does not only undermine, but is as well depleting the local economy. Meanwhile,  the CBL reports in its annual report (2015) that from preliminary statistics, the Capital & Financial Account balance grew by 32.6 percent to US$878.1 million in 2015, from US$662.2 million in 2014, largely explained by a surge in the capital account balance that outweighed the 5.3 percent decline recorded in the financial account balance. Net remittances grew by 625% between 2013 and 2015; while net current transfers also grew by 37.1%.

At a high level round table debate organized by the Governance Commission on February 23, 2015, several personalities opined on the matter, including Senate President Pro Tempore Hon. Armah Jallah, who argued that a US dollarized economy breeds a Liberian banking system vulnerable to capital flight and susceptible to fluctuations in foreign exchange, increases difficulties for authorities to stabilize the economy, and loses having an autonomous monetary and exchange rate policy. Pro Temp Jallah also argued that the Central Bank of Liberia (CBL) does not have the statutory mandate to issue, print, or dispose of foreign currencies especially the US dollar. This challenge, he observed, renders the CBL ineffective and powerless to monitor the inflow and outflow of currencies. Senator Jallah concluded by recommending the use of the Liberian dollar as Liberia’s single currency.

At the same Governance Commission round table, Commerce and Industry Minister Axel Addy said Liberia is heavily dollarized “with the US dollar estimated to account for about 90% of money supply” but that dollarization does not preclude monetary policy from achieving prize stability. Minister Addy emphasized that successful de-dollarization may be difficult to achieve in Liberia because of the country’s high dependency on the US dollar. Minister Addy was also quick to note that the use of the US dollar as a legal currency in Liberia has not minimized what he described as “the effects of economic mismanagement, governance problems and the consequential loss of international consequence”.  At the same time Commerce Minister Addy says a single currency regime in Liberia, if not properly planned, structured and implemented could pose economic uncertainties and hardships for banks, businesses, investors, and the Liberian people. He’s therefore recommending the need to revive and strengthen strategic sectors of the economy such as: (a) Commercial sector in light of the huge informal sector; (b) Empower Liberians in the agriculture sector; and (c) Empower Liberians in service sector who find themselves near industrial/concessions operated areas.

Dr. James F. Kollie, then Acting Minister of Finance and Development Planning (MFDP), noted that lots of research have already been done on Liberia’s dual currency regime. According to Dr. Kollie, the CBL Act Part V clearly points to the use of both currencies (LD$ and USD) in Liberia, noting that Liberia’s threshold of 87% far exceeds the stipulated dollarized economy threshold of 30%. He said the dual currency issue should be looked at from both the transaction and dollarization perspectives. He therefore emphasized that if a critical and empirical approach is not adopted, the introduction of a single currency (Liberian dollar) would create a disruption.

Meanwhile Dr. Kollie has warned that considering the transactional cost of dollarization it will take Liberia 6-7 years to achieve a single currency regime and a stabilized economy. He said other countries took decades to achieve a single currency regime, and suggested that further research be undertaken to go beyond the constitutional solution to delve into other critical fiscal issues mentioned above to inform the proposed single currency regime.

Responding to the issue raised by the MFDP, the CBL said there is a need for proper sequencing i.e. looking at price structure, liquidity and its associated implications. Should prices be quoted in only LD$ (which then suggests that LD$ becomes the sole trading currency?) How can the Liberian dollar be strengthened if it is to serve as the Liberian single currency? 

The Dean of the College of Business & Public Administration, University of Liberia, Professor Geegbae A. Geegbae, advised that care must be taken to avoid the circumstances that occurred during the introduction of the seven (7) cornered coins (Unknown Soldier) introduced in October 1982 by the then National bank of Liberia. He reiterated the cautions of the Acting Minister of MFDP and Deputy Governor of CBL, that care must be exerted in moving toward a single currency regime in Liberia. Dr. Geegbae wants Liberia to proceed with caution as she strives to introduce a single currency, preferably LD$ regime, which he says, should be undertaken within a well-defined timeline. He noted that majority of business transactions by the people are done in LD$. (Culled from the Governance Commission website www.governancecommissionlr.org).

In an article published by the Daily Observer on Tuesday, December 15, 2015, entitled, LET’S LECTURE: Liberia’s Dual Currency Conundrum, the late Harry Greaves quotes President William V. S. Tubman as saying he (Tubman) could not switch from the USD to a local currency (LD) because he did not trust himself, meaning he did not trust himself not to yield to the temptation of printing money in order for the government to spend money that it did not have. Mr. Greaves continues that probably the biggest competitive advantage we have relative to our neighbors is the fact that we use the US dollar. He says the USD is a freely convertible currency and the currency of choice for international trade. “Prices for commodities---oil, minerals, precious metals, etc.---are all denominated in US dollars. Moreover, using the US dollar opens up all kinds of opportunities that we have not yet fully tapped to bring in more foreign direct investment. In addition to extractive industries we should be looking at ourselves as a regional hub for manufacturing, banking, insurance and other financial services”, says Mr. Greaves.
For their part, IMF Staff Researchers Lodewyk Erasmus, Jules Leichter, and Jeta Menkulasi (IMF Working Paper WP/09/37, Dedollarization in Liberia—Lessons from Cross-country Experience, March 2009), write that generally speaking, countries that have chosen a gradual market-driven approach have had more success at achieving sustained de-dollarization than countries that have implemented a forced de-dollarization reliant on administrative measures. The Staff Researchers identified three basic approaches to reverse dollarization:

The IMF Staffers identified the following lessons for Liberia:

Finally, the IMF Research Staffers propose policy options for Liberia that consider maintaining the status quo, moving to full dollarization, or implementing policies to promote de-dollarization.  For instance, the IMF Staff thinks the current dual currency policy seems to be appropriate for Liberia, and argues that despite high dollarization, Liberia’s current macroeconomic policies have supported economic stability and a recovery in GDP growth.  The IMF Staff also believes that with Liberia’s long history as a dual currency regime and the comprehensive nature of dollarization, forced de-dollarization with premature removal of legal tender status from the U.S. dollar would be risky and unwarranted.
But the IMF Staffers say if the Liberian authorities decide to de-dollarize, the following cautious approach should be taken:

The Liberian authorities however appear to be cautiously taking these steps that have been recommended by the IMF Staff to de-dollarize using the market driven approach.  Already a domestic market in Treasury bills have been created; the Liberian dollar is being used to settle a growing proportion of domestic debt and salaries; agents are being required to accept Liberian dollar payments which are being deposited into bank accounts, thus increasing the use of Liberian dollar as a unit of account.  Consequentially, though, the Liberian dollar appears to be depreciating fast, sparking fears that more use of Liberian dollar could lead to heightened financial instability.  

So, what shall it be? To maintain dollarization, or to de-dollarize?  If the decision is to de-dollarize, should it be done via a market driven approach, or by forced de-dollarization?  Where does the single regional currency –Eco- relevance and implication come in? (We will keep the discussion of a single regional currency –Eco- for another day!)


The author holds a PhD in Economics; is a Certified Internal Auditor; a Certified Public Accountant; and a Fellow of the Association of Chartered Certified Accountants.



Kandajabab Zoebohn Zoedjallah
Dump the LRD and stick with the USD. Sharing a single cutrency with 52 advanced economies while our major sources of our rconomy - OIL, IRON OTE, RUBBER, MARITIME, ETC. are booming puts our country on economic parity with other advanced economies sharing a songle currency! Modern say Rome - America shall be glad to drop "THE STICK" used on Liberia since its loggerhead with Tolbert and give Liberia "THE CARROT" by accepting this deal of a single currency with its closest allt in that sphere of influence of theirs (America's)!

Continuong with that crap called LRD is the mother of all deceptions and corruption on the part of Liberia's decision makers who hsrdly touch the LRD!
Kandajabab Zoebohn Zoedjallah at 03:29PM, 2016/07/13.
Sylvester moses
Liberia should stick with the status quo, a dual currency economy. Ironically, try as he did to leave choosing an option in the hands of individual readers, by carefully exhausting the "pros and cons" on the relevant literature of his subject - matter, Dr Collins, perhaps, unintentionally, gave us Hobson's choice.

Anyway, despite the conventional wisdom that citizens' participation in governance ends in the voting booths, and the Mass Media is said to inflame rather than inform the people, we're hoping that our legislators will seek public inputs before rushing with the "So - say - one - so - say - all" garvel. Make no mistakes, regardless of frenzied flag waving about "relative peace", a precarious economic climate is a potential indicator of instability.

Sylvester moses at 06:39PM, 2016/07/14.
Kandajabab Zoebohn Zoedjallah
Collins may have "unintentionally given us Hobson's choice" which is "kill or be killed". But your Lockean proposal of "rivalry" rather than enmity between the LRD and the USD seems to be counter-productive by only benefiting the elite as the LRD DRPRECIATES VIZ THE USD to the advantage of the elite and the disadvantage of the majority! Visit FPA.
Kandajabab Zoebohn Zoedjallah at 10:06PM, 2016/07/14.
sylvester moses
Maybe, instead of "rivalry", you should have borrowed EJS's "creative tension" in her fence - mending speech at the UP Convention in Gbarnga. But, seriously, there isn't a better alternative; a point which the article's varied and well - sourced supporting materials highlighted. If we were to take phraseology cues from another political leader, the straight - talking Senator PYJ, a dual currency economy is "the lesser of two evils".
sylvester moses at 05:49AM, 2016/07/15.
sylvester moses
Kandajaba, of course, you know that the good doctor didn't put US dollar currency economy, or full dollarization on the topic question, because he knows that choice isn't ours to make. Instead, the strength of the overall economy determines whether we could, and capable of sustaining it too. Dear friend, a scenario where everybody goes about hoarding available US dollars, thus stifling simple buying and selling isn't what you wish for the Liberia we know you cherish to the marrow of your bones.
sylvester moses at 10:43AM, 2016/07/15.
Sylvester moses
To take this conversation to its logical conclusion, the preference for the US dollar over ours is indicative of more confidence in the American currency as a legal tender. Simply put, they have the gold, or wherewithal to back the given value of their money; so goes the assumption, or fiction, depending on one's worldview.

Needless to say there was a time when the mighty US dollar became useless too. For example, during the Civil War between the North and South both reportedly employed taxation approaches of over "$1.5 billion in paper dollars that began depreciating before the ink had a chance to dry".

Moreover, today, Germany is the main economic engine behind the Euro. The fact of the matter is that in the immediate post - World War 1 years, the German mark depreciated so badly that one thousand marks couldn't buy a loaf of bread, an economic calamity Hitler and his National Socialist goons exploited to gain power through the ballot box in 1933.

What we want to conclude with is the thought that a nation can't seriously talk about monetary policy in a vacuum, or without factoring in total economic performance. The economy can always be a threat to stability. African security services dealing with intelligence gathering and analysis forget this to the peril of their countries. As Bill Clinton' s 1992 strategist, James Caville, famously emphasized, "It's the economy, stupid".
Sylvester moses at 02:30PM, 2016/07/15.
Kandajabab Zoebohn Zoedjallah
Sylvester, were "people going about hoarding US Dollars" prior to the USA'S withdrawal of America's economic Investments in Liberia during the Tolbert regime? NO! Such s premise about "people hoarding US Dollar" is as weak as the one that dropping the LRD and sharing a single currency with 52 advanced economies (as we did prior to Tolbert) "the CBL would not have Control over monetary policy" as if the central banks of those countries sharing the EURO SINGLE CURRENCY do not have Control over their national monetary policies. What a deception! Again, Sylvester, were "people going about hoarding US Dollars prior to Tolbert's misinterpretation of national interest or Doe's minting and printing of Money smid THE STICK FROM THE USA - IN TERMS OF MODRRN DAY ROME'S ECONOMIC POLICY? HELL NO!
Kandajabab Zoebohn Zoedjallah at 03:25PM, 2016/07/15.
sylvester moses
Kandajabab, when our economy is strong enough to sustain full dollarization, no problem. And let's not forget that the right to vote is fully in the hands of the people, and consequently their expectations are higher. The dependency on pre - 1980 godfathers has ended, the downtrodden would prefer opportunities - education, skills' training, jobs, small business and so on.
sylvester moses at 03:56PM, 2016/07/15.
Kandajabab Zoebohn Zoedjallah
Sylvester, this is not about individuals or pre-1980/post 1980 "godfathers". It is about erecting sound economic, diplomatic, and foreign, policies! And of Course such implementations cannot be Before 26th or Christmas. If the major sources of our economy were that weak as you seem to suggest, the president's son Robert Sirleaf would have not been able to siphon 2.5 Billion US dollars as discovered by the FBI nor would the elite been able to enjoy such huge capital flight or transfer of US DOLLARS from Liberia on a daily basis!
Kandajabab Zoebohn Zoedjallah at 09:03AM, 2016/07/16.
sylvester moses
Kandajaba, obviously, our economy is very weak; politicians can't legislate Liberia into full dollarization; and you know that, friend. Similarly, Ukraine will not legislate its way into the Euro zone. There are requirements and benchmarks, some of which are so stringent that EU countries such as Greece, Portugal, Italy, Spain, and, even, France were forced to implement unbearable austerity measures their middle classes currently chafe under. Some believe the anger is stoking immigration backlashes, and populism across Europe.

The moral here for the powers that be at home is: stop spending money like a drunken sailor; improve public school education; encourage entrepreneurship; invest in jobs; prioritize agriculture to ensure food security, and earn foreign exchange from food exports; don't personalize our diamonds and gold (the South African economy depends on theirs), and, most importantly, as Alton C. Armah expects of the political leadership - be a "shepherd".

If we fulfill that wishlist and much more, our legislators wouldn't have to stress over monetary policy. And it's not that the powers that be don't know the problems, or the solutions. The perception is that they just don't care as long as their financial concerns and interests are well taken care of.
sylvester moses at 03:08PM, 2016/07/16.
Kandajaba Zoebohn Zoedjallah
Ukraine does not need the euro. What Ukraine needs is the EU, USA, and Russia,leaving the decision as to who calls the shots in Ukraine BE LEFT TO THE CHOICE AND DECISION OF UKRAINIANS! Now let us deal with your premise of "very weak economy with powers spending money like drunken sailors" and see why you may want to rescind such argument.

"Zimbabwe in 2009 abandoned its local currency because of hyperinflation, and became dollarized, which led to financial stabilization and growth in commerce and services (Kudakwashe Munsaka, How dollarization has contributed to the Zimbabwean Economy, March 28, 2014)." Pasted from Collins´ article above.

Now, Sylvester, was Zimbabwe´s economy not "VERY WEAK" when the country legislated full dollarization??? While you are at that, Sylvester, Peruse this excerpt infra from FPA´S TODAY´S EDITORIAL:

THE ECONOMIC SITUATION characterizing the devaluation of the Liberia dollar has proven to be one of the worse in the recent history of the country. Even during the war years or the economic instability characterized by international sanctions against the regime of former President Charles G. Taylor, the Liberian dollar did not fall in such high value to the United States dollars.

THE EXCHANGE RATE NOW stands at US$1 to LD$97 and in some commercial areas such as Red Light and the Du Port road all in Paynesville, the exchange rate is even higher.

So, dear friend, if Zimbabwe with such weak relationship with the USA could benefit from such expediency or wisdom, what about Liberia which according to Washington has an "UNSHAKABLE RELATIONSHIP WITH THE USA" as sounded by the US Ambassador few hours ago? So you see, such arguments as "weak economy, hoarding US Dollars, powers spending like drunken sailors" cannot help. By the way, why the "escapism" if we may quote you viz the President´s son Robert Sirleaf siphoning of 2.5 billion US Dollars from the Liberian economy.
Kandajaba Zoebohn Zoedjallah at 02:34PM, 2016/07/17.
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Showbox at 06:27AM, 2016/12/08.
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Lukin Alexander Vasilievich at 11:25AM, 2017/05/07.
Simb
I am surprised why this is even a debate. Success in de-dollarisation is a function of confidence in the Government and monetary authorities. I am from Zimbabwe and yes we did enjoy a recovery in commerce from 2009-2013 but this has all reversed following a political change in Government that has seen excessive spending supported by the issuance of treasury bills and notes and the introduction of a local currency pegged at 1 for 1 with the USD which has a vibrant parallel market where this local currency continues to lose value. I support sticking to the use of the USD once dollarised and dealing with you macro-economic issues before even thinking of suggesting for de-dollarisation.

The biggest hurdle when trying to de-dollarise is maintaining a period of stability for decades especially in Africa. That is why I think once you are dollarised just remain dollarised. The problems of being dollarised are far less cumbersome than attempts at de-dollarising.
Simb at 02:38AM, 2017/06/22.
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I was very interested to read this article and find out your professional opinion on this issue, thank you very much for telling the truth
little caesars near me at 06:37AM, 2017/09/04.

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