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MOF Decentralizes Treasury Function

February 17, 2014

The Ministry of Finance says it has taken a leap in an effort to decentralize its treasury functions across the country, particularly in the rural areas. A release issued over the weekend says Finance Minister Amara Konneh had signed a Memorandum of Understanding or MOU, authorizing the Afriland First Bank to operationalize the Cash centers in River Gee and Grand Kru Counties.

The MOU is part of an overall effort of the Government of Liberia through the ministry to expand fiscal operations at the county level by way of taking services to the grass root to encourage dispersed growth and development across the country.

It said the MOU exemplifies government's plan to decentralize some of its treasury functions to the counties to grow their capacity for fiscal decentralization as envisaged in the recently promulgated national policy on decentralization and local governance.

Out of 15 counties, the ministry says only nine are currently served by either commercial banks or the Central Bank of Liberia or CBL. As a consequence, it said the ministry will charter UN flights on a monthly basis to deliver salaries to government staff working in those areas.

To alleviate this problem, the Ministry of Finance announced that it had started constructing cash centers; a mechanism, it said, was launched by President Ellen Johnson Sirleaf in Gbarpolu County in July 2013. The primary objective of the cash center framework is to enable civil servants conveniently and timely access their salaries with few constraints.

The ministry sees the offer for the commercial bank to partner with the government in operating the cash centers for mutual benefits as crucial, saying the centers need to be operated by a professional team.

"Paying civil servants in these areas of employment increases their purchasing power. It was in this vein that the Ministry of Finance sought the partnership of commercial banks through an open request to partner in the provision of cash services and other related banking services in Grand Kru and River Gee Counties," the release said.

In this call, the Afriland First Bank, a legal registered banking institution in the country expressed interest in the Cash Center process, according to the Finance Ministry.

The Bank will empower the local people through the provision of loans and other financial services, while the government of Liberia will use the bank for revenue deposit and will partner with the Bank to foster timely payment of civil servant salaries.

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Source: AllAfrica

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