With just seven months into the 2013/14 fiscal year, Finance Minister Amara Konneh has announced a budget shortfall of about US$17 million. Minister Konneh made the revelation Tuesday, January 21, 2014 before members of the House of Representatives in plenary at the Capitol in Monrovia.
Konneh's disclosure was made at the Capitol in the wake of high cost living being experienced by Liberians across the country, while the exchange rate of the Liberian Dollar to One United States Dollar is now 87.
The "continental award-winning" Finance Minister also added that the government has also experienced a US$68m delay in its national budget, while it has generated about US$200 million since the passage of the 2013/2014 budget, further noting that the delay in the revenue generation emanated from some key government institutions, including the National Port Authority, Liberia Petroleum Refinery of Liberia, as well as the Liberia Telecommunications Authority, among others.
He accused the institutions of reneging on settling their financial obligations with the government. According to Amara Konneh, the NPA committed itself to contributing to the budget the amount of US$1 million, while the LPRC promised US$3 million, but failed to provide the amounts as enshrined in the budget.
Explaining further, the Minister said the LTA was expected to generate some revenues from the issuance of licenses to technology operating institutions and the sale of Libercell- a GSM Company, which defrauded the government of US$1 million through tax invasion and was ordered closed by the Supreme Court.
"As the result of the delays in these revenues generation encountered by the Finance Ministry revenue department, the government has experienced a drastic drop in revenues in its coffers, and that the government is under pressure to meet its demands as requested by the budget; and the national budget is a law that he and his team cannot afford to violate," Konneh noted said.
Another factor, he claimed, that was responsible for the downward trend of the economy were strategies by many taxpayers to invade taxes, but assured the people of Liberia that every effort would be exerted to ensure payment in the shortest possible time.
He also disclosed that despite several development constraints confronting the Government of President Ellen Johnson-Sirleaf, fundamentally, the nation's economy remains solid. "The country faces further challenges due to its susceptibility to external factors; Liberia's undiversified economy depends heavily on exports such as iron ore, rubber and timber, which are reliant on fluctuating international prices and demands. The major staple food- rice is imported, increasing vulnerability to external prices."
"Our revised projections for 2013 imply a real GDP growth of 8.1%, compared to 7.5 percent in 2012. The higher-than-anticipated growth at the first review is associated mainly with stronger mining activities.
At the time, non-resources real GDP growth (construction in particular) had accelerated in the first half of the year, reflecting the pick-up in public investment compared to 2012, as well as robust private investment," the minister noted.
Summing up the key expenditures of the government, Konneh pointed out that the government spent about US$15. 9 million on goods and services, while US$22. 6 million was spent on the salaries of all government employees, including the President and senior officials of government.
Meanwhile, Minister Konneh said the present demand on the national budget is at SU2bn. But what is available now is over US$500m.