Taming the Dollar to strengthen the Leone

PUAWUI – DR SAMA BANYA: Sierra Leone Telegraph: 23 August 2019:

After pumping thousands or is it millions of United States Dollars into the Sierra Leone financial system and hoping for an upturn in the fortune of our national currency – the Leone, the Central Bank Governor has taken some bold steps to control the crazy financial market.

Would anyone really tell what else needs to be done to shore up the Leone, in addition to the Governor of the Central Bank Professor Kallon stepping in to instil some sense and discipline into the volatile market?

He has been criticised or ridiculed by the columnist of one of our very serious newspapers for doing too little and even too late.

The columnist queries why the Governor (Photo) hadn’t taken these bold steps immediately on taking up office. “Really?” I ask.

Let me once more delve into an area which is the domain of financial experts and their contemporaries.

But again my intervention is based on the down-to –earth experiences of my friends out there, who know more about this kind of market than is often realised by many people.

As Minister of Development and Economic Planning in President Siaka Steven’s government in 1978, my portfolio included liaising with the Mano River Union (MRU), the Economic Community of West African States (ECOWAS), the Economic Commission for Africa (ECU) and the United Nations Development Programme (UNDP) among others.

Most of our ministerial discussions in the MRU and ECOWAS in particular centred on the Customs Union, especially the harmonisation of Tariffs. Those discussions were still going on when I was shown the Red Flag, and I am not aware that much progress had been made but for one recent good news.

That is the recent decision of the Heads of State or The Authority of ECOWAS to adopt a common currency for our sub-region – known as the ECO; or is it ECHO, effective 2020 or thereabouts.  The advantage of this cannot be overemphasised. Some will say, but the United Kingdom has voted to leave the EU, although she was never a part of the common currency the -Euro.

Italy is threatening to leave but this has to do with its internal politics and wrangling. A great advantage of a common currency is its effect on smuggling and on the trade; and speculation in foreign currency transactions by rogue dealers.

But let me help both the Minister of Finance, the Bank Governor and the Commissioner General of the National Revenue Authority (NRA), especially its customs and excise division of a rampant exercise of which they may  not be aware. Again this advice is not vintage Puawui, although my vanity would have liked me to take credit for it.

Like I have mentioned before, I get a lot of financial knowledge including the vexed question of the US Dollar versus the Leone situation from my friends.

The NRA’s Deputy Commissioner General (my adopted daughter Kpakanya) launched an ASYCUDA at Gbalamunya customs post between Sierra Leone and our sister Republic of Guinea last week.

It is hoped that this will enhance increased revenue collection and contain smuggling at the same time. It must be admitted that smuggling at the Guinea and Liberia borders pose the greatest threat to the survival of the Leone.

But the installation of the most sophisticated systems by itself will not be enough. What is needed is a combined customs, military and police vigilance at our borders. Otherwise our best endeavours in the fate of our currency will be in vain, and here is why.

A container of cigarettes as an example lands in Conakry, and all customs and exercise duties to the value of U S $500,000 is paid. The container of cigarettes is then moved to the Sierra Leone border as it often happens, to a secret hideout. It is from there that the consignment is brought into Sierra Leone in batches, genuinely or otherwise and often only a fraction of its real value is paid in duties.

Once in Freetown and elsewhere the consignment is disposed of quietly and at great profit to the importer/smuggler because of the next to nothing duty paid. With threefold profit in his pocket that trader will and does buy United States Dollars at whatever price and by that all the dollar is bought off the market.

He doesn’t care because he is assured of more than a handsome profit. The exercise is repeated until the container in the Guinean hideout is exhausted and the process is repeated. Are we surprised then that the dollar carries such a high value vis-a-vis the Leone?

The government needs to plug those leakages as it has successfully done in other areas. In the words of the SLPP slogan, it is the only way out and the only way forward. Over to you our “Talk-and-do” President; you are equal to the task; take the lead now.

Let’s put an end to the nauseating habit

Will someone please tell me, because I have never experienced it. Never have I heard anyone boast that the government of Sierra Leone at any time, be it late Sir Milton’s or Sir Albert Margai’s, Siaka Stevens’, Joseph Saidu Momoh’s, Tejan-Kabbah’s or Ernest Bai Koroma and on to our own Maada Bio, especially as a mark of defiance or show of influence, that the government is in their pocket.

Jamil Sahid Mohamed and Tony Yazbeck – both had tremendous influence on Pa Shakie; the young Khadi and others had a lot of influence on Joseph Saidu Momoh; Tejan-Kabbah, Ernest Bai Koroma all had their special friends; and even Maada Bio – but not one of those favoured ones ever boasted that the subjects or their governments were in their pockets.

This allegation is one of the easiest and perhaps most destructive ways that some people adopt in order to destroy the reputation of others, especially the foreigners among us. On Thursday of last week while driving along Pademba Road, I caught a glance of a front page headline that quoted somebody boasting with the words: “The Bio government is in my pocket.” The Rotarian would ask, “Is it true, is it fair etc., etc”

I wonder when this kind of gutter journalism will stop!

4 Comments

  1. I am very please to oblige my contribution to all this shenanigans.

    Let us focus on the main issues that is making things difficult for the economy.
    1. All monies owed by culprits who embezzled public funds should be returned or face criminal prosecution immediately no matter where they are.
    2. All mining licences suspended and renewed only and after a thorough examination of the M And A and have been scrutinised to certify that none of the rogue former officials are not still involved in the economic performances through devious means.
    3. The Bank Of Sierra Leone to re – visit its trading polices and encourage the buying and selling of Gold locally and other controlled commodities by the GDDO.
    4. Immediately pull out of the controlled Export Licence certification imposed by the international body,for the export of our mining commodities/resources as its only working for them to keep us in control.

  2. Ok Dr Banya,since you asked that someone tell you about the nauseating habit,I will gladly willing to help you with that.
    First and foremost, the newspaper caption that took your attention last Thursday at Pademba road,is real! It means,a common man will never get fair treatment or trial with a politician,presidential lobbyists,business tycoons who have ties to a member of parliament or government.

    However I am just wondering for all these years you have been a journalist,writer and pundit,what makes you think that such a caption is gutter journalism as you put it.Let me hastily tell you that,you seeing such an uncomfortable reality as gutter journalism does not make it so.

    So what that caption says to you is real ok? Its a reality that, all the former president allies,lobbyists,political friends have all been saying that very word you finally came across in Pademba road. Some even have the guts to come out in public in saying that. Starting from Siaka Stevens up to the current Bio administration.

    You having the opportunity to see just a caption in a newspaper should have given you more enthusiasm to make further research,rather than you concluding to make it look like a mere word from a rotarian or a journalist who only intended to bad mouth the Bio administration. The way you make closing argument in your pieces these days makes me wonder if one can really lend a reality check pretence to your articles.

    I remember the last time you wrote a piece regarding Bio’s administration,in that piece you sound like,it is time for the Bio administration to do the same thing the apc had been doing to them.Such a piece was so controversial that,most commentators in this forum were flabbergasted. And here you are again today,making a closing argument that the “government dae na mi poki” thing has never been said by any one, not even from the past administrations. With all due respect sir, that is not true.

    Now let me give you a quick insight of my experience to this ‘government is in my pocket’ thing. As a young man growing up in the 80s to 90s,I used to travelled to Freetown with my uncle who was a diamond dealer.At the time,diamond princes at the district headquarters town were little low and buyers like Lebanese,Indians,and Maraka men were so reluctant to pay higher price for half carat, 1 carat, etc..So the need for these sellers like my uncle to go to Freetown was a must. And since my uncle cannot read or write better,taking me along was an advantage in helping him with anything that would have to do with paper signing and identifying authentic receipt.

    In these diamond business offices,you will hear the conversation amongst these men about how the government is in their pockets, in case of any unfair treatment,bullying,bad prices, etc,so that sellers like my uncle would have no choice but to deal with them and move on. Am not talking about just one office,am talking about all the diamond business offices me and my uncle have been to. Over 10 of these offices we go to, to do business, carry the same discussion. Its almost like a common discussion at the time.

    So when one begins to see the level of injustice the common man is still facing today in Sierra Leone, from most of these immigrants and you hear common people in the street using these expressions,you know exactly why they are saying it…if you are hoping to see or hear many of these so called presidential lobbyists,friends,business tycoons come out openly to use this expression,you are greatly mistaken.

    Because,these folks would only say these words in their closed doors and in real action,they act like it.Only a few do come out openly.And folks who witnessed this incident how,when and where,these words are being said,know exactly that these men meant business when they say it. And these expressions have taken a deep reality hit on the common man in the street.

    There is also a proverb that says,when a child told you that ploughing for next season is to take place over there, he must have heard it from his dad’s mouth himself.

  3. The pumping of thousands or millions of US dollars into the financial system does not make sense to me. This just tells you the race against time by this government. I need the KOREAN PEOPLE’S WON each time I travel to North Korea. I don’t need the DOLLAR because, if I arrive at the airport in North Korea, I would have to change the DOLLAR to the KOREAN PEOPLE’S WON.

    Why not just pump the currencies of the different countries where Sierra Leoneans travel (whether for visit or business) most into the financial system. It tastes bitter to people who don’t want to do the right thing. But as far as I am concerned, it tastes like sugar. Typical economist. Think about that Mr. Central Bank Governor. GOD BLESS our financial system from this race against time.

  4. Such baseless measures were imposed by the Government of President JS Momoh and we all know what happened. So let us take our economy seriously.

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