24 September 2007

Liberia: G-8 Rallies for Country's Debts

Monrovia — The scary state of impoverished devastations of Liberia infrastructure and sparse population as aftershocks of nearly two decades of civil crisis, have heavily impacted upon empathetic consideration of leaders of the eight industrialized countries, known as the G-8 to seek debt relief for the country.

In a move that is highly unprecedented, the leaders of the first world cream of economies have already provided almost sixty percent of the cost for financing Liberia's arrears with the International Monetary Fund (IMF).

While these measures are ongoing, the nation, according to public finance analysts say that the national debt burden has clocked a little over US$4 billion , thus geometrically choking the meager population of a little over three million people.

The Analyst reflects on this largesse of the powerful countries as additional offshoots of sound macroeconomic policies of the administration of Presiddent Ellen Johnson Sirleaf and her ebullient ruling political organization, the Unity Party (UP).

The world's leading industrialized countries under the banner of the G-8 have taken another measure to relieve Liberia of its multilateral debt burden.

The country according to latest national statistics is externally obligated to the tune of some US$ 4 billion, the bulk of which is accrued interests on principal loans taken over the years from the reign of President William Tubman in the 1940s to the present era.

Contributing US$324.5 million in Special Drawing Rights (SDR) for the country, the G-8 announnced the amount will go towards financing the cost of clearing Liberia's arrears at the International Monetary Fund.

The G-8 countries' contribution represents 60-percent of the cost for financing Liberia's arrears at the IMF. While this is substantial indeed, Liberia also has huge multilateral debts with the World Bank, African Development Bank as well bilateral debts with some of the same countries comprising the G-8.

A communication from the German Minister for Development Cooperation, Madam Heidemarie Wieczoreck-Zeul, which she addressed to President Ellen Johnson Sirleaf, disclosed that Germany and some G-8 countries are also currently holding discussions with other countries to achieve a rapid solution to Liberia's debt issue with the view of ensuring that the rest of the costs are covered.

Executive Mansion release under the signature of Press Secretary Cyrus Badio quotes the German Development Cooperation Minister as saying that she regards the comprehensive cancellation of Liberia's debts as a key contribution to the reconstruction and development of the country.

Minister Wieczoreck-Zeul is reported to have disclosed further that Germany has been advocating the rapid and comprehensive clearing of Liberia's arrears to International financial institutions and assured the Liberian leader that Germany will also make a financial contribution to the process wherever this may be necessary.

The German Minister also assured President Johnson-Sirleaf that under her country's current role as President of the G-8, the group will continue to press for a solution that will allow Liberia to gain entry as soon as possible to the Heavily Indebted Poor Countries (HIPIC) debt relief initiative.

Preparations, she said, are currently underway at the IMF to meet the objective.

Madam Wieczorek-Zeul also expressed confidence that an agreement could soon be reached between the African Development Bank (ADB), the donor countries and Liberia, regarding the debt the country owes the ADB.

The German Minister said her government has informed the Bank that it would provide 7-million Euros as its contribution to help offset the ADB debt, and has urged the Bank to take the necessary steps that will allow a decision to be reached very soon.

Regarding bilateral cooperation and a recent commitment of more than 14-million United States dollars for infrastructure reconstruction in Liberia, the German Development Cooperation Minister said, planned measures are becoming more concrete, noting that the first appraisal mission took place in Monrovia in June this year.

She disclosed that close dialogue has also been launched with the World Bank on the shape of the planned Multi-Donor Trust Fund for infrastructure.

The latest effort by Germany to tackle Liberia's debt burden comes less than three weeks away from an official visit to Liberia in October by that country's Chancellor Angela Merkel, who is noted to be the world's most influential female leader.

President Ellen Johnson-Sirleaf held talks with the Germany Chancellor in May during a visit to Berlin. During talks at the Bundeskanzleramt, Dr. Merkel promised to support international efforts to address Liberia's debt issue, now estimated at more than US$4-billion.

In a related development, the Liberian leader, President Ellen Johnson-Sirleaf and the Management of the National Port Authority have met with the Liberian Council of Churches to exchange ideas geared towards facilitating the timely clearance of goods from the Freeport of Monrovia.

The President emphasized that it was vital to acquaint government with difficulties faced by churches in the importation and clearance of goods at the Freeport of Monrovia.

Madam Sirleaf spoke of the need to institute measures to address problems facing church groups as they clear their supplies at the Freeport. The Liberian leader expressed government's desire to ensure that the support received by Liberians from religious institutions would continue.

The President urged the Liberian Council of Churches to liaise with the Finance Ministry for the smooth implementation of regulations governing the importation and clearance of goods under terms and conditions set by government.

Speaking on behalf of the Council, Methodist Bishop Rev. Dr. John Innis spoke of the high cost of duty on supplies brought into the country and called on government to institute measures to address the situation.

National Port Authority Managing Director George Tubman suggested that the Council of Churches organize a clearing house where Bills of Laden will be cleared. The measure, Mr. Tubman suggested, will ease the difficulties often experienced by Churches in clearing their supplies.

NPA Managing Director assured the President and Church leaders that his Management is working to put in place measures to address past bottlenecks.

Mr. Tubman also acknowledged the long stay of containers in the Port prior to clearance by owners and expressed the hope that solutions can be found to the problem.

It was not however known whether duty free privileges would be granted to such faith based organizations by virtue of their valuable contributions to citizens under these trying times of national existence.

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