The Board of Directors of the African Development Fund (ADF), the concessional lending arm of the African Development Bank Group, has approved an $18.3 million financing package to enhance Liberia's capacity for revenue collection and governance reforms.
The funding supports the Institutional Support for Enhanced Domestic Revenue Mobilization and Reform Implementation Project (ISEDRMP) aimed at strengthening domestic revenue generation, enhancing public financial management systems, and promoting transparency and accountability, particularly in the extractive sector.
The financing package includes a $9.6 million ADF-16 loan, a $6.8 million TSF Pillar I loan, and a $1.9 million in-kind contribution from the Liberian government. This initiative underscores the African Development Bank's commitment to fostering fiscal stability, effective governance, and inclusive economic growth in Liberia.
The project builds on previous Bank's successful governance programmes, including the Integrated Public Financial Management Reform Projects (IPFMRP) I and II, which significantly strengthened Liberia's fiscal management systems. Key achievements include strengthening the Liberia Revenue Authority (LRA) and the Financial Intelligence Agency (FIA), adopting advanced financial management systems, and implementing policies that enhance national revenue performance. The ISEDRMP leverages these successes to address current domestic revenue mobilization and governance challenges.
The project will roll out critical interventions, including digitizing tax collection systems, modernizing judicial processes for financial crime prosecution, enhancing anti-corruption mechanisms, and updating mining sector policies to reduce tax leakages. These strategic approaches aim to create a more robust and transparent governance framework. It will also build the capacity of law enforcement agencies to address illicit financial flows and ensure compliance with tax obligations.
This initiative represents a direct investment in Liberia's institutional infrastructure, perfectly aligned with the country's Pro-Poor Agenda for Prosperity and Development. By addressing systemic revenue collection and governance challenges, the project seeks to unlock the nation's economic potential and support its path toward sustainable development.
"This project directly tackles Liberia's key fiscal and governance challenges," said Yusuf Bob Foday, African Development Bank Officer-in-Charge for Liberia. "It will help create a modern, transparent, and inclusive public financial management system while unlocking the full potential of the country's natural resources."
Kevin Lumbila, Manager of the Governance and Economic Reforms Department at the African Development Bank, further emphasized the project's significance, stating, "By enhancing digital systems and strengthening institutional capacities, this project will significantly improve revenue collection and public sector accountability in Liberia, laying a solid foundation for sustainable economic growth."
The ISEDRMP aligns with Liberia's Pro-Poor Agenda for Prosperity and Development. By improving fiscal capacity and transparency, the project will expand public service delivery, create jobs, and strengthen trust in government institutions.
Through targeted reforms and institutional support, the African Development Bank continues to advance Liberia's journey toward sustainable and inclusive development.
