To: Editor-in-Chief – The Cocorioco Newspaper
Attached – PDF copy
Cc: Mr. KABS KANU,
Cc: Mr. Moses Ben Kanu, & Mr. Sion Lion
Cc: Mr. Patrick Saidu Conteh
Cc: Sierra Leone’s All News outlets – print and electronic medias
Re: In reply to the Cocorioco News Headline: “Bank Governor contradicts Maada Bio: President Koroma left a whooping U.S $507 Million in foreign reserves”
The premise of the newspaper reports aggregated by Sion Lion and Moses Ben Kanu that was published on your Cocorioco news website on May 5th 2018, are completely erroneous, highly misleading and very partisan at best. Sion Lion and Moses Ben Kanu characterization of what was said by the Central Bank of Sierra Leone Governor, Mr. Patrick Saidu Conteh were complete mischaracterization of the material facts and the intent of the monetary policy statement Mr. Conteh was trying to convey to the citizens of the Republic of Sierra Leone and their International Stakeholders at the news conference organized and held at the Ministry of Finance in Freetown, on May 5th 2018.
First of all, Mr. Patrick Saidu Conteh is my friend, and a fellow professional Banker who would not deliberately mislead, nor misrepresent the cardinal Tennent of Monetary policy and the state of Sierra Leone Monetary economy he outlined in his remarks at the news conference. Secondly, Central Bankers like Mr. Patrick Conteh are all Monetarists who’s loyalties are politically neutral and not lured by partisan politics as your authors would like the Sierra Leonean public and stakeholders to believe. Thirdly, Sion Lion and Moses Ben Kanu’s commentaries and authorship of inflammatory headlines like: “Bank Governor contradicts Maada Bio: President Koroma left a whooping U.S $507 Million in foreign reserves” without the true context of what was said, how it was said and why it was said within the framework and circumstance of the central bank’s setting, fosters misinformation and disinformation that’s harmful to the economy and people of Sierra Leone. But above all, we need to educate your colleagues on Central Bank operations. The minimum reserve of $507 million USD that Mr. Patrick Conteh referred to in his remarks is a statutory amount that the Central Bank of Sierra Leone is mandated and required and supposed to maintain and hold at all times in its Reserves account that’s equivalent to three (3) months of import covers as per the West African Monetary Zone Primary Convergence criteria in case there is a shock to the economy like the Ebola virus disease and mudslides Sierra Leone faced in the recent past.
This amount should be used to import essential commodities instantly before resorting to international assistance. The All Peoples Congress (APC) Party Inherited same and equivalent amount in the Central bank of Sierra Leone Reserve account when the APC party took office in 2007, as a matter of routine statutory requirement for the Central bank operations. Now, let’s compare this to the Microeconomics level as in the case of individual citizens and Household in Sierra Leone as depositors who bank with Commercial Retails Banks in Sierra Leone. All depositors are required by banking policy to maintain a nominal amount with a hold in their savings accounts for the privilege of holding a savings account say with the Sierra Leone Commercial Bank. Normally all depositors are required to deposit a minimum of Le50, 000 (SLL) with a hold placed on it in order to maintain the privilege of owning that account. This minimum deposit amount is useless to you because you cannot withdraw it except you decide to close the account in the case of an adverse situation or circumstance in your life. Same is true for the Central bank of Sierra Leone Reserve amount of $507 Million USD, as the minimum balance that cannot be given to any Government, or Party to spend at will as your writers would like Sierra Leone public to believe. Now, if the current SLPP Government want to buy business as usual consumption purchases, they can’t use that money at all as per Inter-and-Intra central banking statutory rules and policy. Sierra Leone is not an Island on its own but a nation state that exists and operates within a community of International Financial Intermediation, and settlements that must be responsibly endowed and engendered in a positive Reserve in order to operate and trade with other nation states.
Elections are over and we have a new Government that must be giving room and space to contribute to the development of Sierra Leone not be continually distracted by inflammatory commentaries on display here, and please we must be intelligent to unveil the real truths:
Central bank of Sierra Leone Reserve: $507 million USD
Republic of Sierra Leone’s External Debt: $2 billion USD
Republic of Sierra Leone’s domestic overdraft: Le160 billion
Republic of Sierra Leone’s Domestic debt Le4.9 trillion
Johnathan P. S. Bangura
Tel: +1 (914) 474-2174