2020 Central Bank of Liberia Annual Report 2020 Central Bank of Liberia Annual Report January 1 to December 31, 2020 © Central Bank of Liberia 2020 "This Annual Report is in line with part XIII Section 63 (1) of the Amendment and Restatement of the Act Establishing the Central Bank of Liberia (CBL) of October 2020. The contents include: (a) report on the Bank’s operations and affairs during the year; and (b) report on the state of the economy, which includes information on the financial sector, monetary aggregates, financial markets developments, and balance of payments performance". i | P a g e Central Bank of Liberia Annual Report 2020 CENTRAL BANK OF LIBERIA Office of the Executive Governor March 30, 2021 His Excellency Dr. George M. Weah PRESIDENT Republic of Liberia Capitol Hill Monrovia, Liberia Dear President Weah: In accordance with part XIII Section 63(1) of the Amendment and Restatement Act (2020) of the Central Bank of Liberia (CBL), I have the honor, on behalf of the Board of Governors and Management of the Bank to submit, herewith, the Annual Report of the CBL to the Government of Liberia for the period January 1 to December 31, 2020. Respectfully yours, J. Aloysius Tarlue, Jr. EXECUTIVE GOVERNOR P.O. BOX 2048, LYNCH & ASHMUN STREETS, MONROVIA, LIBERIA Tel.: (231) 0881 551 953 Website: www.cbl.org.lr ii | P a g e Central Bank of Liberia Annual Report 2020 CONTENTS ACRONYMS............................................................................................................................................... ix FOREWORD ............................................................................................................................................... 1 The CBL’s Vision, Mission, Objectives, Functions, and Autonomy ............................................................ 5 EXECUTIVE SUMMARY ......................................................................................................................... 7 HIGHLIGHTS .......................................................................................................................................... 10 The Board of Governors ............................................................................................................................ 11 The Management ...................................................................................................................................... 12 Heads of Department / Senior Staff ........................................................................................................ 12 Chart 1: The Organizational Structure ..................................................................................................... 12 Chapter 1.0: Governance and Organizational Structure ........................................................................ 14 1.1 The Board of Governors ................................................................................................................ 14 1.2 Committees of the Board ............................................................................................................... 17 1.3 Policy Decisions by the Board ....................................................................................................... 17 1.4 Monetary Policy Framework and Operations ............................................................................. 17 1.4.1 Mandates ................................................................................................................................... 18 1.5 Monetary Policy Advisory Committee Meetings ........................................................................ 18 Chapter 2.0: Global Economy .................................................................................................................. 23 2.1 World Output ................................................................................................................................. 23 2.2 Global Inflation .............................................................................................................................. 25 2.3 Commodities Market ...................................................................................................................... 25 2.3.1 Crude Oil ................................................................................................................................ 25 2.3.2 Iron Ore .................................................................................................................................. 25 2.3.3 Rubber .................................................................................................................................... 26 2.3.4 Palm Oil .................................................................................................................................. 26 2.3.5 Cocoa Beans ............................................................................................................................ 26 2.3.6 Rice .......................................................................................................................................... 26 2.3.7 Gold ......................................................................................................................................... 26 2.4 Global Financial Markets ............................................................................................................. 27 2.5 Implications for the Liberian Economy ...................................................................................... 27 iii | P a g e Central Bank of Liberia Annual Report 2020 Chapter 3.0: Domestic Economy .............................................................................................................. 29 3.1 Overview ......................................................................................................................................... 29 3.2 Real Sector Performance ............................................................................................................... 30 3.2.1 Price Developments ................................................................................................................. 33 3.2.2 Consumer and Business Sentiments ...................................................................................... 36 3.3 Monetary Developments ................................................................................................................ 37 3.3.1 Monetary Aggregates .............................................................................................................. 37 3.3.2 Commercial Banks’ Credits to the Economy ....................................................................... 41 3.3.3 Interest Rates ........................................................................................................................... 42 3.4 Financial Markets Developments .................................................................................................. 43 3.4.1 CBL Bills .................................................................................................................................. 43 3.4.2 Foreign Exchange Market ...................................................................................................... 44 3.4.2.1 CBL’s Foreign Exchange Auction ................................................................................. 44 3.4.3 Standing Facilities ................................................................................................................... 45 3.4.4 Cost of Monetary Policy Intervention ................................................................................... 46 3.4.5 Interbank Market Developments .......................................................................................... 46 3.4.6 GOL Treasury Bills and Bonds ............................................................................................. 46 3.5 External Sector Developments ..................................................................................................... 47 3.5.1 Overview of the Balance of Payments (BOP) ....................................................................... 47 3.5.2 Financial Account (FA) .......................................................................................................... 49 3.5.3 Capital Account (KA) ............................................................................................................. 50 3.5.4 Current Account (CA) ............................................................................................................ 50 3.5.5 International Reserves ............................................................................................................ 52 3.5.6 Direction of Trade (DOT) ....................................................................................................... 53 3.5.7 Exchange Rate Developments ................................................................................................ 54 3.6 Fiscal Sector Developments ........................................................................................................... 55 3.6.1 Overview of Operations ......................................................................................................... 55 3.6.2 Revenue .................................................................................................................................... 56 3.6.3 Expenditure ............................................................................................................................