LEGAP Is Inadequate - Liberia Needs a Comprehensive Approach to
Development and Management of Its Government & Resources

By P. Nathaniel Boe

The Perspective
Atlanta, Georgia
July 28, 2005


In recent weeks, News reports indicate that the International community sua sponte has drafted a document called Liberia Economic Governance and Action Plan (LEGAP”).” It appears that the intent of the document is to “ring-fence key sources of revenue, place international supervisors in key ministries and bring judges from abroad.” (See IRIN, June 16, 2005). It is anticipated that a steering committee will be set up comprising of representatives of the UN, the European Union, ECOWAS, United States, IMF and World Bank. The reports further indicate that the body would have the power to veto government economic policies and contract awards and would exercise strict control over all government money for a period of three (3) years. (See Supra). The apparent outcome of the proposed donors’ action is to address the “systemic and endemic” corruption in Liberia.

I believe that most ordinary Liberians who suffer the most during the 14 years Civil War are highly grateful to the international community for its tremendous efforts in restoring peace to Liberia. The international community is encouraged to continue its engagement with Liberia for the next several decades.


My views are inopposite to the general intent of finding a way to safeguard Liberia’s resources and bring about sound and transparent management of the Republic, and therefore, support the concept of LEGAP. I am a strong advocate of the transparent management of Liberia’s resources and government functions, but the LEGAP proposal in its current form is very inadequate and must be taken under advisement for reconsideration.

A. National Transitional Government of Liberia May Lack Legal Authority
to Bind Future Elected Government to LEGAP

It appears that the National Transitional Government of Liberia (“NTGL”) may lack the legal and/or moral authority to bind a future Government and People of Liberia to the percepts of LEGAP after January 2006. As anyone who has had international exposure knows, an outgoing government administration cannot bind the succeeding government to an agreement for the first half of the new government’s term in office.

In addition, in February 2004, the international community pledged $520 Million to start the reconstruction of Liberia during the transition period. The leadership of the NTGL participated in the negotiation and drafting of the Results-Focused Transition Framework (“RFTF”). Under that plan, $46.4 Million was allocated under the UNDP Trust Fund to be used to restore electricity, but Liberia still lacks electricity today.

This matter is a concern because if we were to assume that the donors have redeemed 50% of their pledges that would result in $23.2 Million being available for electricity in Liberia. With $23.2 Million in hand, there are several companies that could have restored stop-gap electricity to Monrovia within a reasonable time.

It is recommended that the international community should hold LEGAP in abeyance until October 12, 2005 or thereafter and begin discussions with the newly elected government and incorporate its ideas into the plan. If the international community ignores this advice, it is likely that any elected President who has his/her own ideas may stonewall the international community and ordinary Liberians will continue to suffer as has happened in the past. In order to avoid this possible failure of the good intentions of the international community, this matter should be presented in such a way that the new leadership in Liberia after January 2006 will take ownership of this enterprise.

On the other hand, it would be prudent for the UN Security Council to immediately pass a resolution putting the international business community on notice that the Liberian government to be elected on October 11, 2005 would not honor any agreements, contracts, concessions and/or deals concluded by the NTGL because it may lack the legal and/or moral authority to bind the People of the Republic.

B. Liberia’s Sovereignty Is Not At Risk

A review of the news reports about the contents of the draft LEGAP proposal, it does not appear that Liberia’s sovereignty is at risk. At this juncture, We the People of the Republic shall not and would not allow the usurpation of Liberia’s sovereignty in the 21st century after 158 years of independence. In order to ally Liberians’ fear of a possible loss of Liberia’s sovereignty and make LEGAP acceptable to the vast majority of Liberians, the international community must ensure that the elected President and the elected Legislature must have very meaningful roles in the crafting and/or implementation of LEGAP including veto powers by either the executive or legislative branch of the Liberian government as contemplated under the Liberian Constitution. The reason for this is that the money or decisions that would be subject to LEGAP belong to ALL the People of Liberia and any decision affecting same would require legislative action and executive approval and/or implementation.

This will ensure that an unelected international or Liberian born expert will not be making fundamental decisions for the Republic without meaningful input by the elected representatives of the People of Liberia.

C. Liberian Law May not Permit International Judges to Work in Liberian
Courts Except as Friends of the Court

One of the proposed actions under LEGAP is to bring in international judges to work as judges in Liberia. It appears that in order to be a judge in any Liberian court, the person must be a Liberian Citizen and admitted to the Liberian bar as either an Attorney-at-Law or Counselor-at-Law.

Given this constraint, it is proposed that foreign judges could work in Liberian courts if they are given special dispensation by the Liberian Supreme Court and work on a Judge Panel of three (3). All decisions must be signed by a Liberian judge after the panel has voted. If the foreign judge is the lone dissenter, he/she could write an amicus curie opinion that will become a part of the record of the case.

The long term solution to corruption in Liberian courts could be addressed by taking two steps. One, the judges and court employees must be subject to the stringent ethical requirements proposed below. Second, the Liberian judges must be paid salaries that meet international standards and the judiciary’s funding must be provided directly from the Liberian Trust Funds proposed below. As long as the judges are paid regularly and the President and Legislature are not able to manipulate the judges’ salaries and allowances, Liberia will have one of the most transparent judiciaries in the world because one cannot imagine a well paid judge wanting to spend up to ten years in a Liberian prison for corruption.


It is strongly recommended that any plan for the future development and management of Liberia’s resources and government must have the following minimum requirements and/or elements:

A. International Community’s Selection of Experts

LEGAP calls for placing international experts in various ministries and selected government agencies to ensure that sound decisions are made that will serve the best interests of the greatest number of Liberians. In order to ensure that this undertaking succeeds, two fundamental concerns must be addressed.

First, there are several Liberian born experts who are managing hundreds of millions of dollars throughout the world who must be given THE FIRST OF RIGHT REFUSAL to provide the services that the international community is seeking. By this I mean, the international community should go through a public and meritorious selection process in selecting the experts needed. For example, if an expert firm is needed to manage the construction of infrastructure in Liberia with a budget of $300 Million, the international community must publish the RFP/Q to allow Liberian owned firms to submit proposals. Liberian owned and managed firms should be given 25 points as part of the evaluation criteria. Verified Liberian owned/managed firms will be 25 points ahead of any other competitors from the start. In addition, if the qualifications of a Japanese firm and a Liberian firm are equal, the contract should be awarded to the Liberian firm. This practice is a normal part of the selection process of consultants and professionals in the United States everyday.

This approach will help Liberian experts to return home or those at home to stay home and grow a middle class in Liberia. It is strongly recommended that the International community be very sensitive in selecting experts to be assigned to Liberia. It is also strongly recommended that the international community adopt this approach when it is selecting consultants and professionals to work in Liberia on their home country funded projects. Liberians must be given the first right of refusal.

Second, any non-Liberian and Liberian born experts must be compensated comparably. Once these two concerns are addressed, both the Liberian born experts and non-Liberians must be subject to the same ethical standards enunciated below.

B. Ethical Requirements for Liberian Officials and International & Liberian Experts

The way forward is for Liberia to implement stringent ethical measures that will ensure that transactions and actions involving the funds and decisions on behalf of the People of Liberia will be undertaken with utmost honesty and integrity.

Implementation of this recommendation is very important because failure on the part of the next administration and the international community to arrest corruption in government transactions will continue to undermine development in Liberia and instability will eventually return because VERY few people will continue to enjoy the resources of Liberia to the exclusion of the greatest number of Liberians.

As I understand it, Liberia has two (2) anticorruption laws including Section 299 of the Penal Code of 1956 that defines embezzlement “as the receipt of money or other articles of value and intentionally, fraudulently converts them to his/her own use is guilty of embezzlement and is punishable by a fine not more than $500.00 or imprisonment for not more than two years; and restitution is required.” Furthermore, Section 116 of the Penal Code of 1956 defines “bribery as the act of giving or solicitation and acceptance of money o other valuables with the understanding that an act, decision, vote, opinion in an official capacity will be influenced, is guilty of a felony and punishable by a fine AND by imprisonment not more than three years.” It should be noted that there is no report that the executive branch of the Liberian government has ever brought a case against any high or middle level government official under the statutes enumerated above.

It is recommended that the elected Liberian government and the international community adopt the following measures to stop/minimize corruption in Liberia:

· On the day of inauguration, the new President must issue an Executive Order relieving all Liberian officials, employees, agents and contractors except for security personnel that report to the Executive Branch of all their duties and responsibilities until they have complied with all Financial Disclosure Requirements and signed an Anti-Corruption Affidavit.
· The Executive Order should direct the Minister of Justice to begin prosecuting anyone in government and in the private sector who is suspected of corruption. The highest ethical/judicial standards must be followed by the prosecutors and courts.
· Under the Executive Order, all Liberian government officials, employees, agents and contractors must submit a Financial Disclosure Statement declaring all of their assets both in Liberia and abroad.
· Each Liberian government officials, employees, agents and contractors must sign an Anti-Corruption Affidavit agreeing that he/she accepts in advance the punishments set forth in Sections 299 and 116 of the Liberian Penal Code, respectively, if he or she engages in corruption as determined by a court of competent jurisdiction.
· All United Nations, international and local NGO personnel operating programs funded by money that has been allocated by the international community for Liberians must be subject to the same anticorruption measures as Liberians.
· For those proposed international experts to be retained under LEGAP, each and everyone of them must be subject to the same anticorruption measures as Liberians.
· Each of the proposed members of the steering committee comprising of representatives of the UN, the European Union, ECOWAS, United States, IMF and World Bank under LEGAP must submit Financial Disclosure Statement and an Anti-Corruption Affidavit agreeing that he/she accepts in advance the punishments set forth in Sections 299 and 116 of the Liberian Penal Code, respectively, and will serve any jail time in Liberia if found guilty of corruption. In addition, if any of the steering committee members is a diplomat, he/she must surrender diplomatic immunity as a pre-condition to serve on the committee.
· The newly elected Liberian Legislature should amend the Liberian Penal Code and the President sign into law increasing the punishment for embezzlement and bribery to triple damages and jail term of up 10 years. The law passed by the Legislature should cover all three branches of the Liberian Government and international/local NGOs operating in Liberia. A person so found guilty must be banned for the rest of his/her useful life from holding any government position and/or doing any business with the government and any affiliated entities.

C. Trust Funds for Liberia

Under LEGAP, Liberia and the international community should create two trust funds as follows:

1. Liberian National Trust Fund

As part of LEGAP, one of the first steps to resolving Liberia’s problems is to establish the Liberian National Trust Fund (“LNTF”) instead of a committee as proposed under LEGAP. The Liberian National Trust Fund must be subject to total transparency. In order to achieve the objective of total transparency, it is proposed that the Trust Fund have a Board of Directors who will be subject to the fiduciary requirements of trustees.

Any payment from the Trust Fund must be subject to an elaborate approval process including triple signature requirements for each transaction and all the signors must have fidelity bonds to safeguard against any attempted fraud and subject to the Ethical Requirements set forth above.

The corpus of LNTF will emanate from the sale of Liberia’s natural resources including, but not limited to, sale of iron ore, oil, timber, gold, diamonds, and income from maritime operations, LPRC, Freeport and other income generating entities.
In order to expedite the reconstruction of Liberia, reduce poverty, return all the children to school and provide adequate healthcare for all Liberians, the Liberian National Trust Fund could securitize the income streams of the various income sources identified above and make hundreds of millions of dollars available to Liberia immediately. For example, it has been reported that Liberia receives approximately $18 Million annually from the maritime program. In 2006, the elected Liberian government could securitize the maritime income for a period of ten (10) years and generate approximately $150 Million through the LNTF immediately for development projects in Liberia. This action will resolve the reported corruption in the Liberian Maritime program.

2. Liberian International Trust Fund

Under LEGAP, a second trust fund should be established for Liberia to be known as the Liberian International Trust Fund (“LITF”). The purpose of LITF is to be the repository for all international economic and/or development funds donated or granted to Liberia. For example, it has been reported that the United States Congress has appropriated approximately $89 Million for Liberia in its Fiscal 2006 budget. $75 Million is in Economic Support Fund and $7.8 Million is for Development Assistance. The $82.8 Million should form part of the corpus of LITF. LITF must be subject to the same stringent standards as LNTF as detailed above.

Based on international standards, the soft cost used to pay consultants and project managers associated with implementing projects financed from the trust fund must be capped at 10%. That means approximately $75 Million of the US funds will be used directly as hard costs to implement the projects.

This proposal is important because it has been reported that some international aid agencies spend up to 50% of international aid on soft costs, which is not helpful to the intended Liberian beneficiaries.

D. De Novo Review of ALL Agreements, Concessions and Licenses Under LEGAP

Based on the facts as I understand them, the NTGL has recently granted four (4) license for operation of GSM cell phones in Liberia; is in the process of evaluating bids for a possible concession agreement for operation of Mount Nimba; an evaluation committee has completed its work and recommended a winner with respect to the privatization of Telecom and a proposed Concession Agreement to extend Firestone’s Operation in Liberia for another 39 years was approved by the National Transitional Legislative Assembly.

As the debate in Liberia and the United States intensifies over whether or not the current administration in Monrovia has the legal authority to enter into contracts that will last beyond it 2-year term, in issue is whether the actions by NTGL are in the “BEST INTERESTS” of the People of Liberia?

As the lawyers and others who represent the investors or potential investors are aware, any commercial transaction or contract that is deemed “unconscionable” (meaning a person of sound mind today who is free from coercion, duress and/or bribery would not sign such a contract) would not be binding on the People of Liberia, and therefore, unenforceable and/or of no legal effect.

It is strongly recommended that the elected Government that will take office in January 2006 should conduct a De Novo review of all existing agreements (concessions, licenses and others) in order to determine if each of the agreements predating February 2006 is in the best interests of the People of Liberia?

In order to avoid any challenge to the actions of the elected Government or favoring nationals and companies from one country over another, the De Novo review should include the use of Objective Criteria that the Government will rely on to either ratify and/or abrogate certain agreements, concessions and/or licenses.

The agreements that should be ratified are those agreements that are entered into through transparent process including publication in the Liberian newspapers with a reasonable period for public scrutiny, ordinary citizens serving on evaluation panels or negotiating teams; the agreement provides benefits to the greatest number of ordinary Liberians, is fair, reasonable and contributes to the actual economic development of Liberia. The agreements should contain provisions that will allow Liberians to buy shares in the entities except for Liberians who will regulate the entities in order to avoid actual or apparent conflict of interest.

On the other hand, the elected Government should abrogate any agreement that is solely focused on extracting raw materials from Liberia without a requirement that at minimum ten (10) percent of the raw material is used to manufacture products in Liberia; concluded under duress and there is suspicion that the Liberian negotiators are part owners of the entity directly or indirectly, were either bribed or coerced and there is no rational basis for entering into the agreement. Liberia can take this action if it is determined that the agreement is unconscionable (meaning a person of sound mind today who is free from coercion, duress and/or bribery would not have signed the agreement).

In the event any agreement does not satisfy the guidelines officially adopted by the new Liberian Government as informed by the recommendations above, the government must rescind or abrogate the agreement and renegotiate the agreement. Prior to abrogating any agreement of a foreign corporation, the Government must have prior consultations with the home country of the company and communicate the justification for said action.

E. National Security Interests & a New Middle Class for Liberia

Presently, Liberia is heavily import dependent and certain items should be declared national security items where their importation would be restricted to Liberian Citizens only. The following item should be declared National Security items including Rice until Liberia is self-sufficient in rice production, oil products and cement. Award of licenses for the importation of these items must be restricted to Liberians only. The New Government must establish certain credit facilities to give impetus to Liberians’ meaningful participation in the approximately $2 Billion import/export annual transactions. The credit facility could be established through the proposed Liberian Trust Funds. Mechanisms must be put in place where Liberian licensees will not become front men/women of our Foreign Friends. As part of granting the licenses, the businessmen and women must agree to be subject to the proposed Ethical Requirements set forth above.

In addition, Liberians must be given preference in the award of all government contracts. The United States government has the same preference system in place under its Disadvantage Business Enterprise program run by the United States Small Business Administration.

The net result of these actions is that Liberia will begin to grow a genuine middle class of businessmen and women who in turn will create jobs for the approximately 85% of our people who are unemployed today.

The writer strongly believes that implementation of the foregoing recommendations will begin the Transformation of Liberia.

About the Author: Mr. P. Nathaniel Boe is an Attorney-at-Law who resides and practices law in the Chicago area. He can be reached at: Nate.Boe@hacp.org