Annual Report on Exchange Arrangements and Exchange Restrictions, 2007
Chapter

LIBERIA

Author(s):
International Monetary Fund. Monetary and Capital Markets Department
Published Date:
October 2007
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(Position as of December 31, 2006)

Status under IMF Articles of Agreement
Article XIVYes.
Exchange Measures
Restrictions and/or multiple currency practicesNo restrictions as reported in the latest staff report as of December 31, 2006.
International security restrictionsNo.
References to legal instruments and hyperlinksn.a.
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
Managed floating with no predetermined path for the exchange rateAll 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) intervenes in the foreign exchange market 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.
References to legal instruments and hyperlinksn.a.
Arrangements for Payments and Receipts
Prescription of currency requirementsNo.
Payments arrangementsNo.
Administration of controlRegulations on export and import licenses are administered by the Ministry of Commerce and Industry (MCI).
Payments arrears
OfficialYes.
PrivateYes.
Controls on trade in gold (coins and/or bullion)
On domestic ownership and/or tradeDomestic trade in gold is subject to licenses issued by the Ministry of Land, Mines, and Energy.
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.
References to legal instruments and hyperlinksn.a.
Resident Accounts
Foreign exchange accounts permittedYes.
Held domesticallyYes.
Held abroadYes.
Accounts in domestic currency held abroadNo.
Accounts in domestic currency convertible into foreign currencyYes.
References to legal instruments and hyperlinksn.a.
Nonresident Accounts
Foreign exchange accounts permittedYes.
Domestic currency accountsYes.
Convertible into foreign currencyYes.
Blocked accountsNo.
References to legal instruments and hyperlinksn.a.
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, quality, quantity, and 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$2,000.
Letters of creditYes.
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 15.7%.
State import monopolyNo.
References to legal instruments and hyperlinksn.a.
Exports and Export Proceeds
Repatriation requirementsNo.
Financing requirementsNo.
Documentation requirementsn.r.
Export licensesLicenses generally are issued to exporters to ensure certification of quality and origin. These licenses are not issued freely.
Export taxesExport taxes are imposed on processed and unprocessed goods at rates of zero and 2.5%, respectively, and on diamonds at a rate of 4%.
References to legal instruments and hyperlinksn.a.
Payments for Invisible Transactions and Current Transfers
Controls on these transfersNo.
References to legal instruments and hyperlinksn.a.
Proceeds from Invisible Transactions and Current Transfers
Repatriation requirementsNo.
Restrictions on use of fundsNo.
References to legal instruments and hyperlinksn.a.
Capital Transactions
Controls on capital transactionsNo.
Repatriation requirementsNo.
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 transactionsNo.
Controls on personal capital transactionsNo.
References to legal instruments and hyperlinksn.a.
Provisions Specific to the Financial Sector
Provisions specific to commercial banks and other credit institutions
Lending locally in foreign exchangeYes.
Differential treatment of deposit accounts in foreign exchange
Reserve requirementsYes.
Liquid asset requirementsYes.
Investment regulationsn.r.
Open foreign exchange position limitsn.r.
Provisions specific to institutional investors
Insurance companiesn.a.
Pension fundsn.a.
Investment firms and collective investment fundsn.a.
References to legal instruments and hyperlinksn.a.
Changes during 2006
No significant changes occurred in the exchange and trade system.

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