Annual Report on Exchange Arrangements and Exchange Restrictions 2005
Chapter

LIBERIA

Author(s):
International Monetary Fund. Monetary and Capital Markets Department
Published Date:
September 2005
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(Position as of December 31, 2004)

Status Under IMF Articles of Agreement
Article XIVYes.
Exchange Arrangement
CurrencyThe currency of Liberia is the Liberian dollar.
Other legal tenderThe U.S. dollar is also legal tender and circulates freely.
Exchange rate structureUnitary.
Classification
Independently floatingThe Liberian dollar is market determined, and all foreign exchange dealers, including banks, are permitted to buy and sell currencies, including the U.S. dollar, at market-determined exchange rates. The Central Bank of Liberia (CBL) reserves the right to intervene to counter speculative movements.
Liberia participates in the W-ERM II, which requires that the CBL maintain the spot exchange rate between the Liberian dollar and the U.S. dollar within margins of ±15% around a central rate. However, the CBL has yet to implement these measures.
Exchange taxNo.
Exchange subsidyNo.
Forward exchange marketNo.
Arrangements for Payments and Receipts
Prescription of currency requirements
Use of foreign exchange among residentsYes.
Payments arrangementsNo.
Administration of controlRegulations on export and import licenses are administered by the Ministry of Commerce and Industry (MCI).
International security restrictionsNo.
Payments arrears
OfficialYes.
PrivateYes.
Controls on trade in gold (coins and/or bullion)
Controls on external tradeImports and exports of gold in any form are subject to licenses issued by the Ministry of Land, Mines, and Energy; import licenses are issued freely, but export licenses are granted restrictively.
Controls on exports and imports of banknotesNo.
Resident Accounts
Foreign exchange accounts permittedYes.
Held domesticallyYes.
Held abroadYes.
Accounts in domestic currency held abroadn.a.
Accounts in domestic currency convertible into foreign currencyYes.
Nonresident Accounts
Foreign exchange accounts permittedYes.
Domestic currency accountsYes.
Convertible into foreign currencyYes.
Blocked accountsNo.
Imports and Import Payments
Foreign exchange budgetNo.
Financing requirements for importsNo.
Documentation requirements for release of foreign exchange for imports
Preshipment inspectionPreshipment inspection is required to ascertain the country of origin, the quality, the quantity, and the value of all goods to be shipped. Both final and intermediate goods are subject to inspection, except for imports with an f.o.b. value of less than the equivalent of US$3,000.
Import licenses and other nontariff measures
Negative listThere is no general system of import control, but the importation of some items, including safety matches, electrode welding rods, and liquefied petroleum gas, is subject to licensing and quantitative restrictions. Licensing requirements are usually not enforced. Imports of arms, ammunition, and explosives require prior licenses. In addition, imports of certain goods (e.g., narcotics, other than for medicinal purposes) are prohibited. Licenses to import inexpensive, widely consumed varieties of rice are issued to private distributors by the MCI. The importation of more expensive rice is not subject to official controls.
Import taxes and/or tariffsThe nominal average tariff rate is 11.7%.
State import monopolyNo.
Exports and Export Proceeds
Repatriation requirementsNo.
Financing requirementsNo.
Documentation requirementsn.r.
Export licensesLicenses generally are issued freely, including those for agricultural products, to ensure certification of quality and origin.
Export taxesExport taxes are imposed on processed and unprocessed goods at rates of zero and 2.5%, respectively, and on diamonds and precious metals at a rate of 4%.
Payments for Invisible Transactions and Current Transfers
Controls on these transfersNo.
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsNo.
Restrictions on use of fundsNo.
Capital Transactions
Controls on capital transactionsYes.
Controls on capital and money market instrumentsNo.
Controls on derivatives and other instrumentsNo.
Controls on credit operationsNo.
Controls on direct investmentNo.
Controls on liquidation of direct investmentNo.
Controls on real estate transactions
Purchase abroad by residentsYes.
Purchase locally by nonresidentsYes.
Controls on personal capital transactionsNo.
Provisions specific to commercial banks and other credit institutionsn.r.
Provisions specific to institutional investorsNo.
Other controls imposed by securities lawsNo.
Changes During 2004
No significant changes occurred in the exchange and trade system.

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