With Comatose Economy How Will The New Leone Fair?
Very soon, the country will be having to deal with a new currency, dubbed the New Leone, a situation where the three last zeros of the current currency has been removed, a situation that has had many criticisms from the public, as well as from other experts, as to the sanity of such a move.
Despite all those criticisms, the government has gone ahead to print the new notes and they are said to be in country now, ready for use. Unfortunately, members of the public do not know much about how to calculate the difference, which in turn will have its own effect on business transactions in the country. Serious action is yet to be seen taken to educate the masses about the new currency, except posters of the various denominations and their value.
However, some Economists say that this move was ill-informed and not in the interest of the country, especially when consideration is taken of the fact that a lot of money has been put into the printing of the various denominations of the new notes. Economists say that unlike other countries that have redenominated their currencies, Sierra Leone lacks what it should use to back the currency. They gave as example the availability of Gold in Ghana to back their own redenomination stride. One notable objector to the introduction of this currency is Economist Prince Macauley, who said that there is no stability of the Leone currently in use, with the dollar skyrocketing by the day. He said that the new currency will enter the market already dead, and has the tendency to cause more hardship and confusion on the people. He furthered that for a country to re-denominate its currency, there is the need for its economy to be stable and its currency also stable against the dollar, but the opposite is the case with Sierra Leone. He furthered that even the dollar is hard to get, with black market being the order of the day. Also that all importers have to look to the black market for dollar to order their goods, thus in his opinion, this move was ill-advised and not timely, as the new currency will be “dead on arrival”. He also called for the sacking of the Bank Governor, who is known to have made several auction of the dollar when he took up office, which was described as a wrong move by other economists, including an expert economist of the World Bank from Zimbabwe.
Many had questioned the rationale of the Bank Governor to auction the dollar several times, and also institute a ban on holding of more than $10,000 on any business and individual, all of which have proved futile in addressing the fast deteriorating Leone value, as against the dollar. Inflation has not only gone up, but is rising by the day, and this has not been as a result of the war in Ukraine, as they will want us to believe, but mere inability to deliver the prudent policies that will ensure a turnaround of the economy.
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