The Liberian Media has an Important Civic Responsibility to Inform and Lead Public
October 5, 2004
Mr. John Morlu's article is the first on the Buchanan iron ore story that makes sense. I share his exasperation with the Liberian media's failure to do simple research or check the facts before rushing into print. I do not have all the details of this particular transaction, but simple arithmetic would have discounted some of the wilder interpretations of what went on.
The stockpile in Buchanan is 700,000 - 800,000 metric tons. It has been there a very long time. So accurate estimates are a little difficult. It's only after all of the ore has been shipped that we will know exactly how much ore of commercial value there is on the ground.
Anyway, based on lands and mines minister Jonathan Mason's disclosure, the ore was sold to the Chinese at a sale price of $10 per ton. That would give a total sales value of $7-$8 million. As far as I know, the port of Buchanan cannot load 700,000 metric tons of ore in one go (I don't know if there are any ships in the world capable of carrying 700,000 metric tons of ore). So, the ore is being shipped in lots of about 50,000 tons. My guess is that the Chinese, given the still uncertain political and business environment in Liberia, would not contract to pay the entire purchase price before all of the ore has been shipped. As a prudent business person, I certainly wouldn't. My guess is that they have contracted to pay on a shipment-by-shipment basis.
Minister Mason gave his interview after one of the shipments and declared that the government had received $500,000. One shipment of 50,000 tons at $10 per ton would yield $500,000. The figure would represent the proceeds from one shipment and should not be confused with the total sales value of the ore, which the government will realize over a period of time based on the total volume of ore shipped.
My understanding is that 3 shipments have been made to date. At the current rate of shipment, the stockpile will probably require 15-16 shipments in all. But of course the papers didn't want to explain that. It was far more sensational to report a contrived "discrepancy" and explain that as NTGL officials "dividing the money".
The story is an important story worthy of public discussion. The Liberian media has an important civic responsibility to inform and lead public discussion of issues like this. However, discharging that responsibility requires serious investment of time and energy in researching the facts and doing simple analysis to determine whether assertions being made by public officials or their critics pass elementary credibility tests. By failing to do so, the media runs the risk of being dismissed as a bunch of sensation-seeking quacks.
Economic Advisor to the Chairman, NTGL