Liberia: Gov’t Seeks IMF Support for ‘Pro-poor Agenda for Development and Prosperity’

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MONROVIA – The Liberian Government delegation attending this year’s International Monetary Fund (IMF) and World Bank Group Springs Meetings in Washington D.C. is seeking support for the implementation of the ‘Pro-poor Agenda for Prosperity and Development’ (PADP), the government’s national development agenda for the next few years of its term in office.


Report by Alaskai Moore Johnson, [email protected]


According
to a dispatch from Washington, the delegation headed by Finance and Development
Planning Minister Samuel Tweah, during discussions had issues such as
investment in private sector, domestic revenue mobilization, digital economy
and social safety net, which are in line of the PAPD, placed before the donor
partners for consideration.

Despite
the government pleading with these international partners support, authorities
at the Finance Ministry disclosed: “The World Bank had already earmarked US$106
for three key sectors, including education — US$50M, water and sewer — US$30M,
and Public Financial Management — US$26M.”

However,
the Liberian Government would have to develop a logical framework and a
rationalized time bound matrix for the utilization of this money.

According
to information, support to water and sewer will focus on providing new pipes
for the Pipeline Water Plant. Support to the education sector will see the
construction of additional schools in 24 districts. It will also include the
construction of teachers’ quarters and science labs. On the public financial
management side, more support will go to setting up of an E-tax policy and
system, e-procurement, capacity development amongst others.

This
year’s Spring Meetings, which ran from April 12 to 14, marked the second
appearance of the George Weah-led administration. The Finance Minister and a
host of other officials of government, including technicians, are attending
these meetings.

The
government’s first opportunity came when it signed a US$3 million grant
agreement with the World Bank. The money, according to the Liberian Delegation,
will go toward the Youth Opportunity Program, including the Ministry of Youth
and Sports and other vocational institutions. The Ministry of Gender and Social
Protection is finalizing arrangement with the World Bank for support through
cash transfer to vulnerable women in four poverty-distressed counties.

It
was also reported that prior to the Spring Meetings, discussion with the World
Bank was underway to seek additional funding for education, public financial
management and water and sewer.

However,
FrontPageAfrica has been told that the government will have to sign on to the
IMF program. Once successful, the country could benefit from additional funds including
budgetary support. To achieve this, the government will have to take strong
measures towards macroeconomic reforms to include transparency in monetary and
fiscal policies, reforming the over-bloated wage bill, governance, business
climate as well improving an enabling environment for agribusiness.

This
newspaper has also gathered that there are indications that government’s
projected revenue for fiscal year 2019/2020 will fall short of expenditure
hence the need for serious austerity measures. The government needs to focus
more on the rationalization of both salaries and allowances within the public
sector. The government critics have said that there is not a coordinated
approach in the payment of allowances in various ministries and agencies. Reforming
the wage bill could be the first best approach for a government that inherited
lots of debts from the previous government.

There
are hints that state-owned enterprises’ (SOEs) transparency and oversight could
be another measure placed on the table by the IMF and WB Group. The Liberian
government does not have a strong framework on how SOEs can contribute to the
country’s budget processes. The international financial reporting standards
require all SOEs to publish their financial statements on a periodic basis.

While
the government has made progress in resolving some of the binding constraints
to the business climate, there is still a need for more reforms. Access to
credit, resolving insolvency and enforcing contracts remain a challenge. The
government has already banned import-permits declaration, while at the same
time making efforts to improve trading across borders.
“Conforming to the
IMF program requires a rigorous self-assessment of the country’s macroeconomic
policies as well as the political will to implement these measures. While this
process can be burdensome for developing countries, it can also offer
opportunities for sustained economic growth and development, especially for a
country that needs more support for infrastructure development and agriculture,”
the dispatch further stated.


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