Regardless of a country's level of development, public procurement plays a critical role in influencing the effectiveness of public service delivery and promoting an environment conducive to inclusive growth. In the context of Liberia, shortcomings in public procurement have contributed to poor governance and limited state capacity. This is a result of the leakages, inefficiencies, and corruption that are prevalent in government procurement processes.
For several decades, Liberia has struggled with corruption, especially in public procurement at all levels of government. Transparency International (TI), a leading global anti-corruption organization, reported a troubling decline in Liberia's Corruption Perception Index (CPI) in 2023, dropping from 32 in 2018 to 25 in 2023. With a ranking of 145 out of 180 countries, Liberia has witnessed one of the most significant declines in the CPI, plummeting by a substantial 16 points from 41 in 2012 to 25 in 2023.
Since the restoration of democracy in 2006, the focus has been on combating public sector-related corruption through the establishment of institutions such as the Public Procurement & Concession Commission (PPCC), the General Auditing Commission (GAC), and the Liberia Anti-Corruption Commission (LACC), etc. While the effectiveness of these efforts remains uncertain, the recent procurement of 285 yellow machines from the SANY Group in China for an estimated cost of US$30 to 50 million has raised concerns. Reports are suggesting that the purchase was part of a mineral swap agreement between the government and an undisclosed company, while others claim it was the result of a sealed loan agreement with government partners. This controversy has once again brought public procurement into the spotlight.
The Public Procurement and Concessions Commission (PPCC) was established as the regulatory authority in charge of monitoring and overseeing public procurement under the Public Procurement Act (PPA) of 2005. The PPA provides a legal framework for public procurement and aims to promote transparency, accountability, and efficiency in the procurement process. However, several factors have hindered the full implementation of the PPA, including a lack of political will, insufficient guidelines, a lack of capacity among procurement officials, and resistance from Ministries, Departments, and Agencies (MDAs). As a result, Liberian procurement practices have suffered, leading to a lack of transparency and accountability, inefficiency, delays, insufficient competition, and limited participation from small and medium-sized enterprises (SMEs).
100 days deliverables and PPCC and Revenue laws violations
In May 2024, the Senate Joint Committee on Public Works and Rural Development, Public Accounts, and Audits, and Judiciary issued a report that revealed Roland Layfette Giddings, Oswald Tweh, Boima Kamara, and Bodger Scott Johnson of the Ministries of Public Works, Justice and Finance and Development Planning, and the Public Procurement and Concessions Commission (PPCC), respectively, for blatant breaches of the PPCC law. They had granted separate road contracts totaling US$22.4 million to various companies without adhering to appropriate procurement procedures and relevant legislative protocols as well as without the approval of the 2024 national budget.
Minister Giddings defended his decision to contravene the law by asserting his authority to maintain essential road segments across the country, particularly during the rainy season. He purportedly communicated with the PPCC seeking a "No Objection" to exclusively source the rehabilitation and periodic maintenance of specified primary road corridors under the President's 100 Days Deliverable project for Fiscal Year 2024.
However, the joint senate committee report disclosed that on March 11, 2024, the Executive Director of the PPCC issued and authorized the "NO OBJECTION" for the companies to carry out the contract without an approved 2024 budget. Additionally, Minister Giddings expressed regret for what he called the missteps in the entire procurement process, extending apologies on behalf of himself, the Ministers of Finance and Justice, and the executive director of the PPCC. Sadly, the National Legislature pardoned the three ministers and the director of the PPCC. It is important to note that both the PPCC and Revenue laws of Liberia stipulate that transactions exceeding $1 million must go through a public procurement tendering process and Legislative approval.
Yellow Machines and Violation of the PPCC and Revenue Laws?
On February 12, 2024, Bronwyn Barnes, the President and CEO of US Company High Power Exploration Inc ("HPX"), announced the signing of a letter of intent with the Government of Liberia and Robert Gumede of Guma Africa Group Ltd. The purpose of this agreement is to initiate negotiations for the ownership, design, financing, development, and operation of the Liberty Corridor connecting Guinea and Liberia.
In May 2024, Madam Mamaka Bility, the Minister of State Without Portfolio, announced the procurement of 285 earth-moving equipment for infrastructure purposes. It has been reported that these 285 machines were provided as signature fees that Robert Gumede of Guma Group agreed to pay for the exploration of the Wologizi Mountain in Lofa County. The Yellow Machines transaction is raising concerns about transparency and adherence to the rule of law. It's essential to clarify whether this involves a loan, grant, donation, or direct purchase. Each option carries significant implications for transparency and the rule of law in Liberia, and it's important to ensure that the proper legal and legislative procedures are followed. If it's a loan, it needs to be ratified by the Legislature as per the Liberian Constitution. If it's a direct purchase using the approved budget, it must adhere to the Public Procurement and Concessions Commission (PPCC) law and Public Financial Management (PFM) law. Additionally, transactions above US$1 million must go through a public procurement tendering process and obtain Legislative approval as per the PPCC law and Revenue Law. Sadly, none of the yellow machines Madam Mamaka Bility coming into the country have met the public procurement tendering process or legislative approval.
The prevalence of corruption and non-compliance with procurement laws presents significant challenges to the public procurement system in Liberia. The lack of transparency and accountability within the procurement process has led to cases of embezzlement, fraud, and misappropriation of funds, undermining the credibility of the procurement system over the decades. These issues have notably impeded project delivery in terms of adherence to specifications, cost and timeline management, as well as overarching standards and sustainability in Liberia.
Also, Liberia's procurement laws and regulations are outdated and in need of reform. This glaring inadequacy has created loopholes that unscrupulous individuals are exploiting to their advantage. It is imperative to introduce innovative practices such as aggregated procurement, centralized purchasing, and the use of technology to revolutionize our public procurement system. Furthermore, the lack of skilled and trained procurement professionals within the public sector is contributing to the decline in efficiency and effectiveness. As a result, there is a misunderstanding of procurement best practices and procedures, which has further dwindled procurement efficiency and effectiveness.
What steps should the Boakai administration take to improve public procurement reforms?
First, the Boakai administration needs to ensure the independence of the Public Procurement and Concessions Commission (PPCC). Creating a self-contained entity free from political interference will help the PPCC carry out its mandate effectively without fear of retaliation. The recent apologies from Roland Layfette Giddings, Oswald Tweh, and Boima Kamara of the Ministries of Public Works, Justice, and Finance and Development Planning are a grim reminder of the blatant violation of PPCC law. The awarding of 10 contracts totaling US$22,389,667.13 without following proper procurement processes and relevant legislative procedures and without being held accountable, signals the need for improved practices during the Boakai administration.
The Boakai administration has an opportunity to enhance the effectiveness of the Public Procurement and Concessions Commission (PPCC) by recruiting qualified staff and ensuring that the PPCC is led by individuals with strong backgrounds in procurement, commercial activities, law, and finance. This will enable the PPCC to build the necessary capacity and expertise to carry out its responsibilities more effectively. A report from the Joint Senate Committee highlighted an instance where the Executive Director of the PPCC approved contracts without an allocated budget, signaling the need for the PPCC to align with legal procedures.
The Boakai-led government must recognize countries with exceptional public procurement systems. Singapore consistently ranks as one of the top countries, boasting an extremely efficient and effective procurement system. The country's robust legal framework, strong anti-corruption measures, and centralized procurement agency all contribute to its unparalleled success. Singapore places a strong emphasis on achieving value for money through competitive bidding, benchmarking, and considering the total cost of ownership. Furthermore, the country utilizes advanced technology, such as e-procurement systems and data analytics, to enhance transparency and efficiency. The collaborative approach among stakeholders has further reinforced the system, cementing Singapore's procurement process as one of the most efficient and effective in the world.
The United Kingdom unequivocally possesses a robust public procurement system that has undergone significant reform. The Crown Commercial Service (CCS) effectively manages centralized procurement by procuring goods and services for all government departments in the United Kingdom. This has irrefutably resulted in streamlined procurement processes and substantial cost savings due to economies of scale.
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To drive positive change in public procurement in Liberia, it is vital to engage a diverse group of stakeholders, including civil society organizations. The Boakai-led administration must take proactive steps to lead the transformation of public procurement in critical sectors of the economy. By providing strong political leadership and support for procurement reforms, while also ensuring the availability of necessary resources and infrastructure, the government can foster effective procurement processes.
Additionally, the Boakai-led administration should focus on enforcing procurement laws and regulations and holding procurement officials accountable for their actions. Procurement professionals need to receive proper training, and qualification, and to adhere to strict ethical and professional standards to ensure transparent and fair procurement processes. Furthermore, suppliers play a crucial role in public procurement by providing essential goods and services for government agencies.
Suppliers are crucial in public procurement, as they are the ones who provide the essential goods and services that government agencies rely on. It is imperative to select suppliers through a rigorous open and competitive bidding process, ensuring that they adhere to uncompromising standards of quality, performance, and ethics. Civil society organizations play a decisive role in promoting transparency and accountability in public procurement, acting as vigilant watchdogs and advocating for critical reforms to bolster transparency and root out corruption. International organizations such as the World Bank and the United Nations Development Programme (UNDP) must unequivocally throw their support behind procurement reforms and initiatives through unwavering technical assistance and funding.
The Boakai administration needs to address the lack of transparency and accountability in the procurement process, as this is undermining public trust in government institutions. By improving the management of public funds and optimizing procurement processes, the administration can ensure better allocation of resources for public services and infrastructure. Addressing these challenges will also contribute to expediting the country's development and growth. Furthermore, the administration should work towards enhancing compliance with the legal framework to hold those involved in procurement malpractice accountable and prevent similar controversies, such as those related to the procurement of 285 earthmoving machines and dump trucks. I rest my pen.
