By Kolec E. Jessey
April 15, 2004
In the past few weeks there has been numerous reports in the Liberian media about pervasive corruption in the transitional government headed by Charles Bryant. These reports had led to misgivings about the government decision to purchase fleets of American Grand Jeep Cherokee through a shady Lebanese trader and the soaring travel expenditures involving the rebel filled transitional legislature.
While these trepidations about the government expenditures in the face of widespread poverty are legitimate, it is essential that we calm down a bit about some of our judgments on the transitional government, take a deep breath, and not be carried away by news report emanating from Monrovia. Yes, yes, I know everything is not rosy in the government in term of transparency and accountability but things are not collapsing under corruption as we are being led to believe.
I have spent the last few days reading the International Monetary (IMF) staff report on Liberia entitled: Report on Post-Conflict Economic Situation and Prospects for January-June 2004 for Liberia, issued March 2004. In that report, the IMF noted that there have been several fiscal and economic measures taken by the Bryant’s interim government to strengthen economic and fiscal management. The report highlighted five control areas in which the government has implemented with the urging of the managing director of the IMF to improve fiscal and economic management.
First, the government has centralized the revenue collections at the Ministry of Finance and ended government institutions levying and retaining taxes and fees for unbudgeted purposes. As a result according to the report, average revenue collection rose to US$5 million per month from October 2003- January 2004, compared with average monthly collection of US$1.3 million in the third quarter of 2003 which happens to be under the disgraced rebel leader, Charles Taylor. Another significant step is the centralization of all government account at the Central Bank of Liberia. This is crucial in ensuring control in the revenue collection process.
Until the Bryant’s government took office according to the IMF staff report, the importation of rice and petroleum products were handle through monopolies by a Lebanese merchant and retailed prices, as fixed by government of Taylor, substantially exceeded import costs and taxes. The transitional government removed the import monopoly for both products and revised retail prices to reflect import cost, trade margins, and taxes. As a result, the report noted that retail prices have dropped significantly while tax collections increased due also to the reinstatement of the general sale tax that had been suspended for both goods.
Another significant step by the government is the decision by the government
at the urging of the IMF to allow an independent audit of the Bureau
of Maritime, the Forestry Development Authority (FDA), Liberia Petroleum
Refinery Company (LPRC), and the Central Bank of Liberia (CBL) to be
conducted with assistance from the European Union. This is significant
in that it will provide assurances to international donors that the
government is serious about Liberia reconstruction and thereby enhance
the prospect of attracting international funding to the country reconstruction
More significant in the report is Bryant’s government decision to implement a number of fiscal measures to improve the budget process and controls. To strengthen cash management at the urging of the IMF, the report noted that the government bank accounts at the Central Bank of Liberia will be consolidated into a single treasury account, and regular meeting will be held to analyze commitments and cash outlays. In addition, the Ministry of Finance will conduct regular reconciliations between revenue, expenditures, and movements in government bank accounts, and produce regular budget reports. “The authorities also intend to request technical assistance to (i) improve the expenditure management process including installation of a robust computerized system; (ii) establish an external audit function; and (iii) bring the procurement process inline with international standards.”
These economic and fiscal measures by the government are not just significant, but signify the transitional government’s commitment to transparency and accountability and help improve the government image to donor agencies and governments. These measures also go a long way in easing concerns about widespread corruption.
This does not suggest that Bryant and the transitional government do not have more to do to control expenditures and corruption. This is quite to the contrary. We have to understand that it will take more than just the transitional period to rebuild institutional controls and fiscal discipline that has broken down over the years. Therefore, it is reasonable for us to commend the government for some of the steps it has taken to bring certain level of transparent and accountable management processes and not just continue to heap criticisms on it.