Press Release: Statement by IMF Mission to Liberia on Progress Under the Staff Monitored Program
November 17, 2006Press Release No. 06/255
The following statement was issued today in Monrovia by Mr. Robert Powell, the IMF mission chief for Liberia:
"The IMF mission team visited Monrovia during November 5-17 to assess progress under the staff monitored program (SMP) for 2006 and to discuss policies to support a successor program for 2007. Meetings were held with Minister of Finance Antoinette Sayeh, Acting Minister of Planning Simeon Monibah, the Executive Governor of the Central Bank of Liberia (CBL) J. Mills Jones, as well as other senior government officials and members of the donor community. The mission also met with President Ellen Johnson-Sirleaf. The mission liaised with the World Bank team in Liberia, and a parallel mission from the African Development Bank.
"Available indicators suggest that economic activity continued to pick up in 2006. Real GDP is projected to increase by around 8 percent owing to the buoyant construction and services sectors which have offset weaker-than-expected rubber production. Inflation is expected to remain in the single digits.
"The government has achieved most of the quantitative benchmarks for end-September under the SMP. In particular revenues in the first quarter of the fiscal year have exceeded the government's initial projections. The financial operations of the CBL also continued to improve in line with program targets. However, severe capacity constraints have led to slower than expected progress with implementing the structural benchmarks.
"The mission agreed with the government, in principle, on policies and benchmarks that could support a successor program during 2007. The government's program for next year will build on the achievements of the current program and envisages the implementation of the domestic debt resolution strategy, a reorganization of tax administration, a further strengthening of the banking system, and commencing the implementation of the government's anti-corruption strategy.
"Liberia's external debt is clearly unsustainable. The mission reiterated the Fund's backing of an early resolution of the financing issue. It underscored that continued progress under a Fund-supported program would help generate support from the international community required to resolve Liberia's large external debt overhang and move toward eventual debt relief."