Despite the Ellen Johnson-Sirleaf Administration's much publicized attainment of debt waiver from international partners and friendly countries, the Liberian Senate Committee on Banking and Currency, has uncovered huge debts owed by the government.
The committee through its Chairperson Senator Isaac Nyenabo, has disclosed that the country's foreign and domestic debts currently stand at US$579.2 million.
Making the disclosure Tuesday during regular session, Senator Nyenabo explained that the stock of debt at the end of 2011 was US$579.2 million, which indicates 7.7 percent due to increase in both domestic and external financial obligations.
He told plenary that US$290.9 million or 12.8 percent was higher than the level recorded at the end of December, 2011, and that domestic debt amounted to US$288.3 million or 49.8 percent of total debt.
Said Sen. Nyenabo: "Domestic obligations to financial institutions stood at US$280.5 million, which has amounted to 97.3 percent of the total domestic debt stock."
Commenting on cash out flow; Nyenabo, a former Senate President Pro-tempore, said out flows remittance recorded a decline from US$1,362.3 million in 2011 to US$1,160.2 million in 2012, which is 14.8 percent, mainly due to a decrease in import payments.
"Foreign exchange inflows were higher than foreign exchange outflows in 2012; the net million flows in 2011 - US$101.1 million, compared with net flow of US$127.2 million," he asserted.
Sen. Nyenabo pointed out that the Central Bank of Liberia has begun a process to establish a collateral registry and upgrade the country's credit reference system with support from the International Finance Company (IFC).
"In this regard, some staff of the CBL concluded a study tour at the Bank of Ghana; the purpose of which was to study that country's collateral registry system with a view to introducing similar infrastructure to the Liberian Banking landscape", the Senator said, and added: "The desire to develop a collateral registry is in response to the problem in Liberia's credit environment, which constrains lending to Small Medium Enterprise System (SMES) in particular and the economy as a whole."
The Banking and Currency Committee noted that the Liberian economy is projected to grow at an average of 7.4 percent over the period spanning 2012 to 2015, which is expected to be delivered by continued rising growth in the agriculture, mining and service sectors.
It however noted that a major problem to domestic real (GDP) growth remains the sluggishness in global economic activity that had already led to fall in commodities' prices, including Liberia's major primary commodity exports; iron ore and rubber.