-Finance Ministry clarifies
Monrovia, Liberia – The Ministry of Finance and Development Planning (MFDP) has revealed that the Government of Liberia did not default on the settlement of its outstanding obligations to the International Development Association (IDA). The IDA is the leading financing institution of the World Bank Group for low-income countries and provides low-interest loans and grants to promote sustainable economic growth and reduce poverty.
According to the MFDP, about US$44.3, (forty-four million two hundred sixty thousand US dollars, to be precise) has been paid by the administration under President Joseph Nyuma Boakai since January 2024. This amount includes US$23M outstanding from 2023 that was not paid by the previous administration, and US$21M out of the scheduled external debt repayments due in 2024.
The payments to the IDA so far stand at US$12.19M. This announcement from the Ministry of Finance and Development Planning comes in the wake of some recent media reports suggesting that Liberia was suspended from the World Bank due to overdue loans.
The Ministry of Finance and Development Planning notes the reduction in external transfer dates at the Central Bank of Liberia which poses challenges to the current Administration. The reduction in transfer dates is due to transfer risks resulting from poor management of external payments by the previous administrations at the Central Bank of Liberia. The Ministry calls on the media to carefully verify information before spreading news that could damage the country’s reputation.
The Federal Reserve Bank of New York which handles international payments for the CBL reduced the weekly transfer period from five days to two days as a result of irregular transactions through the CBL in the period before the January 2024 transition of power. This means the due dates for some IDA loan repayments do not fall on the CBL transfer dates leading to what is being wrongly interpreted as defaults by the Government.
The challenges in debt management for the current Government of President Joseph Nyuma Boakai mustn’t be limited to the huge debt portfolio of 2.6 billion, including US$1.5 billion accumulated under the CDC government in six years compared to US$881.8M during the entire twelve years of the first Unity Party administration. There is also the challenge of dealing with debt payments that werescheduled in previous years but not paid.
however, the Ministry of Finance and Development Planning assures the people of Liberia and partners of Liberia that the government remains committed to strengthening its relationships with the World Bank and other international partners in recognition of the critical roles development partners continue to play in advancing the country’s development agenda.
The ministry’s priority remains the promotion of the government’s agenda through development partnerships for sustainable development, a stronger and stable economy, and improved quality of life for all Liberians.
