Sierra Leone on Friday introduced a new family of banknotes with three zeros removed from the leone to restore confidence in the inflation-hit national currency.
The Bank of Sierra Leone announced the move last August, insisting the public’s spending power would not be affected by the change.
“We removed three zeros from our banknotes, but yesterday’s money has the same value as today,” President Julius Maada Bio said at a ceremony at the central bank unveiling the new bills.
A note of 10 new leones is equivalent to a note of 10,000 old leones, changing hands for about 75 US cents.
According to the national statistics agency, annual inflation in the West African country was 24.87 percent in May.
Rising prices had spurred the printing of banknotes, resulting in a mountain of paper money that is costly to maintain and unwieldy for the public.
Buyers need huge amounts of banknotes for the simplest of transactions, and unscrupulous bank teller’s sometimes steal banknotes from sealed wads of money.
“We’re removing the ‘zeros of shame’ to get the currency right,” Morlai Bangura, a central bank governor, told AFP earlier in the week.
He said the bank started distributing the new paper notes to commercial banks last week.
On Friday, despite the rain, customers lined up at commercial banks to exchange their old banknotes for new ones.
“Changing our currency is necessary – we used to carry bags to the bank to withdraw our money but not anymore,” said Alice Frazer, 70, after exchanging her bills at the state-owned Sierra Leone Commercial Bank in the center of Freetown.
The new banknotes are similar in design to the old ones, but smaller.
“Our current currency is too big to fit in a wallet and we spend too much money to print oversized bills,” Kelfala Murana Kallon, the central bank governor, told reporters last August when announcing the move .
The central bank declined to comment on the cost of the operation.
Sierra Leone’s eight million people live in one of the poorest countries in the world, ranked 182 out of 189 in the UN’s Human Development Index.
The economy, which is heavily dependent on minerals, was devastated by a civil war that lasted from 1991 to 2002 and left about 120,000 dead.
Reconstruction efforts have been set back by an Ebola epidemic in 2014-2016, a drop in global commodity prices and the coronavirus epidemic – all of which have disrupted trade and investment and hit exports.
Sierra Leoneans can use both old and new banknotes for a transitional period until September 30th.
From October 1st, the old currency will no longer be legal tender.
The public can exchange the old currency for the new until Nov. 15, Kallon said in a statement.
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