20 April 2012

Liberia: Energy for Nation Tops Spring Meetings in Washington D.C

The rehabilitation of the Mount Coffee Hydro Plant to boost sustainable economic growth and development in Liberia dominates high-level discussions with key stakeholders of the World Bank and the International Monetary Fund (IMF) at the Spring Meetings in Washington D.C, USA.

According to a dispatch, the high-powered Liberian delegation headed by Finance Minister Amara Konneh has been holding high-level consultative meetings with key stakeholders of the Fund and the Bank, seeking their supports and commitment to the hydro's rehabilitation project and other relevant investment projects in Liberia.

In separate meetings with senior level executives, including the Bank's Managing Director, Sri Mulyani Indrawati , the outgoing Bank's Vice President for Africa, Oby Ezekwesili, the IMF Deputy Managing Director, Naoyuki Shinohara, and the Director of the IMF's African Department, former Liberian Finance Minister, Antoinette Monsio Sayeh, Minister Konneh raised the urgency for the Mt. Coffee hydro project.

Describing the project as a national emergency for economic reasons, the head of the Liberian delegation, Minister Konneh stressed that the Mount Coffee hydro Plant, which was ruined during the conflict remains a major component of the solution to Liberia's problems with the availability of affordable energy.

He said the rebuilding of the hydro-plant is expected to generate around 64MW (the pre-war capacity) of power in the peak season; and the future expansion with the Via Reservoir could increase both the generation capacity and the reliability of this. Electricity demand is expected to increase around tenfold by 2030 and the Government does not wish access to electricity to be a constraint on Liberia's growth. On this note, the Minister has set the benchmark for the MT Coffee Hydro Plant at 200 MW to the development partners.

Minister Konneh highlighted to the senior management of the Bank and Fund the importance of infrastructure in meeting the Government's development aims and the broad goal of becoming a middle income country by 2030. Mount Coffee has been cited as a key project for the new administration in line with this goal. The expansion of access to affordable electricity will lower business costs and household expenses, increasing their investments, and lower Government costs allowing more funds for development priorities. With fuel costs expected to continue to increase, and oil price shocks more likely with regional instability in the Middle East, it has become even more crucial to find sources of power generation that do not rely on petrol. The current cost of generation in Liberia is around 40 US cents per kWh, one of the highest tariffs in the World, and the highest in Africa.

He appealed to the Bank to exercise flexibility in the next four to five years on major projects including the Mt. Coffee project in order to fast track their implementation and consolidate their gains to show that Liberia remains a success country. "This is Government's number one priority," Minister Konneh said. He emphasized Liberia's desire to continue to work with the Bank and the Fund towards the speedy development of Liberia. He informed the two financial institutions that the Government of Liberia has demonstrated its commitment towards this drive by earmarking in the 2012/13 Budget at least 10 per cent of the 25 per cent directed towards capital investments entirely for energy projects.

In addition to the Mount Coffee project, Minister Konneh informed the Bank and the Fund that the West African Power Pool (WAPP) project will be instrumental in enhancing the availability, and reducing the cost, of power in Liberia. This project is expected to be completed over the next few years and will allow Liberia to initially import cheaper electricity, and eventually, as our hydro potential is met, export to our neighbors.

Minister Konneh, setting out the Government's agenda for power, also noted the importance of the Liberia Electricity System Enhancement Project (LESEP) which will improve and increase access to electricity in Liberia and enhance the distribution services. Minister Konneh said LESEP will also create options for power generation to decrease current tariff that is constraining local manufacturers and small businesses in their effort to increase products to meet demand and create jobs. He made it clear that the expansion of access is to occur alongside the expansion of cheap generation capacity.

The Liberian Treasury Chief told the meetings that besides the Mt. Coffee project, the Government of Liberia will make investment in education and health as well as some other priority areas including the rehabilitation of major highways in the country, the ports, ICT infrastructure, Youth development, job creation and capacity building.

Minister Konneh used the meetings to update the World Bank and IMF authorities on Liberia's vision, development strategy and other activities. The Liberian Minister appealed that future engagements with donors, including the IMF and the World Bank must be towards Government's objectives and priorities.

He also briefed the meetings on the Government's new development agenda for Transformation (AFT), which is a five-year implementation strategy for Vision 2030 that will commence in fiscal year 2012/13. He said the AFT sets out clear priorities, top of which is infrastructure development, particularly the rehabilitation of the Mt. Coffee, roads and ports.

Meanwhile, the Bank and IMF have assured the Liberian Government of their extensive supports and commitment to its development agenda including the much-needed rehabilitation of the Mt. Coffee hydro plant and the country's new national visioning process.

The Bank and IMF authorities also praised the Government for the level of development achieved during the last six years. They said their respective institutions will continue to support projects implementation. The Bank's Managing Director challenged the Liberian Government to continue to exercise leadership and said that the Bank will be willing to do donors coordination to ensure effective delivery of service to the people of Liberia. She further assured the Liberian Delegation that the doors of the World Bank are open for flexibility to ensure that the development agenda of the Liberia is achieved to meet the high expectation of the Liberian people.

"The World Bank is open to helping Liberia achieves its objective even if you want us to build 500 MW power generation or more, we are ready and please keep on knocking my doors to remind me should there be any slow pace on our part; I will do all I can to move the process quickly".

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