12 November 2009
Liberia is among 86 developing countries that have become eligible for grant assistance in the fiscal year 2010, says the just released United States government Millennium Challenge Corporation (MCC) country-by-country indicator data that measures the policy performance of each nation.
MCC indicators measure each nation performance on good governance, economic freedom and investments in people. The score card released on Monday, November 9, 2009, says Liberia continues to make progress on good governance, particularly in the area of political rights, civil liberty, control of corruption and voice and accountability. MCC scorecard also suggests Liberia still has a long way to go in providing basic services and improving the economy.
The MCC report shows that Liberia passes two indicators for the first time: natural resource management and business start-up costs. The improvement in business start-up was a result of concerted efforts by the Liberian Government led by the National Investment Commission, Ministry of Commerce and Industry, Finance, Foreign Affairs, and the Liberia Better Business Forum through a partnership with the International Finance Corporation (IFC).
The MCC report also indicates that Liberia made good on four of six "ruling justly" or governance indicators, the same as last year. Liberia once again passes the corruption indicator, although its score slipped fairly.
The MCC report highlights the challenges Liberia still faces in passing three other indicators that it had passed the previous two years. Those basic services indicators include the immunization rate, government health spending, and the inflation rate. The first two are due to revisions in the data rather than a true deterioration.
According to the revised data, Liberia actually should not have passed these two indicators in the past. The failure in the inflation indicator is due to the spike in world food and oil prices during 2008. However, inflation has since subsided, and the lower inflation rate so far during 2009 indicates that Liberia should have no trouble in passing the inflation indicator in 2010.
Minister of Planning and Economic Affairs, Amara Konneh says Liberia was selected last December by the MCC Board as threshold eligible. He said since that time, the Ministry of Planning and Economic Affairs has coordinated the development of Liberia's Threshold Country Program (TCP) with all relevant stakeholders in collaboration with USAID which addresses Land Rights and Access, Girls Primary Education Completion Rate, and Trade Policy.
Liberia's MCC Threshold Program is in the final design stage of development and continued government oversight should improve indicators in the coming years. Minister Konneh says these indicators are areas of weakness in Liberia's policy performance, and improving them would eventually help Liberia qualify for the larger compact grants in three years. The MCC Board will consider Liberia's TCP when it meets on December 9, 2009.
To meet the requirements for full compact eligibility in the future, Liberia will have to pass two more "investing in people" or basic services indicators and one more "economic freedom" indicator. Minister Konneh says that "passing these indicators next year will be possible, but only with focused efforts in specific areas. We must maintain our performance in governance (especially control of corruption) and in business start-up costs, and improve performance in health and education indicators.
MCC assistance is designed to provide an incentive for countries to adopt policies that encourage economic growth and poverty reduction.
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