Legislating for a Dollar-Denominated Salaries in Liberia: Imperative for Economic and Social Growth: In Addition to the Decent Wage Law:
By: Austin S Fallah – A True Son of Liberia, Africa and the Planet Earth Soil:
The economic fabric of Liberia has long been intertwined with the dynamics of currency and valuation.
With a bifurcated economy operating in both Liberian dollars (LRD) and United States dollars (USD), the constant flux of exchange rates and the predominance of the USD in business transactions has created a complex fiscal landscape.
Arguably, this complication has acted as a stumbling block to the country’s economic empowerment and stability.
More specifically, the differentiation in currency wages for employees, especially those working for companies earning in USD, has resulted in inconsistencies that may undermine economic growth and the social betterment of the workforce.
Hence, through a legislative mandate, the government of Liberia must enforce the payment of wages and salaries in United States dollars for employees in companies earning in USD.
This reform (revisiting the decent wage art) would not only bring about greater economic empowerment but also assure economic resilience in the face of inflation.
Establishing a salary structure that can withstand inflationary pressures is integral to fostering a robust and prosperous society.
Argument for Economic Empowerment:
Economic empowerment that springs from a stable and reliable currency plays a critical role in any country’s advancement. In Liberia, the dual-currency system has led to a disparity in purchasing power among workers, which hurts the country’s overall economic health.
Entities earning in USD but paying their employees in LRD subject these workers to the volatility of the exchange rate.
This practice can result in a rapid decline in real income, hindering any attempt at savings or investment, a key component of economic empowerment.
By mandating establishments that earn in USD to pay their employees, likewise, the Liberian government will effectively shield its citizens from the capricious nature of exchange rates.
Salaried workers will be able to plan their expenditures, savings, and investments with greater confidence, leading to increased consumer spending.
This empowerment extends beyond the personnel to foster a more stable demand in the economy, which is a precursor to growth.
In turn, this legislation would be catalytic, encouraging multipliers across various sectors of the economy, as employees have more disposable income in a globally recognized and stable currency.
The Argument for Social Growth:
The overlap of economic stability and social growth is well-documented.
When workers are paid with a stable and internationally valued currency, their capacity for social advancement is markedly improved.
Access to quality housing, education, and healthcare, all of which may be priced or heavily influenced by USD rates, becomes significantly attainable.
Consequently, the overall standard of living increases, engendering a ripple effect of better health outcomes, educational advancement, and economic opportunities.
The assurance that comes with USD-denominated salaries serves to reduce worker anxiety linked to currency devaluation and inflation.
This equates to a more satisfied and motivated workforce, which is essential to fostering a progressive, inclusive, and cohesive society.
The Liberian government must legislate (Revisit the Decent Wage Law) wages in USD to align more closely with the aspirations of its citizens, thereby enhancing social cohesion and stability.
Argument Against Inflation:
Liberia, like many developing countries, is susceptible to inflationary spirals that can derail economic planning and devalue savings and wages.
A salary-wage structure stemming from a currency as strong and stable as the USD creates a bulwark against inflation.
This shield is especially important for a country where many essential goods and commodities are imported and priced in USD.
A currency as volatile as the LRD in an inflationary economy causes havoc on the purchasing power of consumers.
By contrast, USD wages ensure that workers’ earnings retain their value despite domestic inflation.
It enables citizens to continue meeting their basic needs without the constant worry of escalating prices.
This initiative would embody an economic strategy that anticipates and mitigates the adverse effects of inflationary trends.
It is, therefore, essential for wage and salary structures to be realigned to a more inflation-resistant currency—the USD.
Precedence and Case Studies:
Several case studies from around the world illustrate the benefits of pegging salaries to a strong foreign currency. Zimbabwe’s adoption of a multi-currency system to combat hyperinflation in 2009 (including the USD) temporarily stabilized the economy and restored value to the employees’ wages.
Similarly, in the Eastern Caribbean, where the Eastern Caribbean dollar is pegged to the USD, economies enjoy relative stability and protection from the whims of inflation.
Liberia can draw valuable lessons from such examples, embracing policies that prioritize the economic interests of both the state and its citizens.
The legislative push for USD-denominated salary wages is not about abandoning the Liberian dollar but about securing a foundation for economic stability and growth.
The imperative for Liberia to enforce wage-salary payments in United States dollars for employees of companies earning in USD is a strategic necessity for the nation’s economic and social development.
The realization of economic empowerment, the deepening of social growth, and the mitigation of inflation are all compelling reasons for this legislative action.
Establishing a salary-wage structure resilient to inflation is indispensable for charting a prosperous and sustainable future.
The government must, therefore, take a decisive stand, not just for the present economic stability but for the enduring strength of Liberia’s economic landscape.
To ensure the nation’s prosperity, salaries should reflect the currency in which companies earn their revenue.
By legislating for the payment of wages and salaries in United States dollars, the government will be taking a crucial step toward securing an economically empowered and socially world-class Liberian workforce.
It is paramount for the liberation of Liberian economic policies to enshrine not just hope but also practical resilience against the tides of economic instability.
In advocating for this reform, one must acknowledge the complexities involved in its implementation.
However, the long-term benefits far outweigh the transient challenges.
It is time for the Liberian government to legislatively mandate the payment of wages in USD and establish a salary structure that can withstand inflation.
It is time to secure the economic backbone of the nation and empower its people toward a future of assured growth and prosperity.
