PRESIDENT ELLEN JOHNSON SIRLEAF OF LIBERIA
Liberia's external debt has somersaulted with a wide margin reduction in two years under the leadership of President Ellen Johnson Sirleaf. Finance Minister, Augustine K. Ngafuan announced the significant reduction at a major press conference yesterday in Monrovia. According to Minister Ngafuan, the Unity Part-led Administration inherited the a total external debt of about US$4.9 billion, but the youthful Finance Boss disclosed yesterday that the debt has been reduced to US$1.7 billion; something which reached this point following a series of debt wavers by several countries and institutions, with the British Government yesterday canceling a debt of USS45 million, out of the US$50.6 million Liberia owed that country.
Minister Ngafuan asserted that the reduction has put Liberia on a good map with international financial institutions including the International Monetary Fund (IMF), World Bank and the African Development Bank (ADB), among others. While the Government has been making tremendous strides in dealing with debt situation with bilateral and multilateral partners, Minister Ngafuan however pointed out that Liberia still had to tackle the huge debt burden with commercial creditors. At this juncture, the Finance Minister revealed that Liberia has taken another giant step in debt reduction, adding, "I am pleased to announce that Liberia has bought back US1.2 Billion of debt from foreign commercial creditors."
He furthered that on Tuesday, April 14, 2009, the Government of Liberia concluded the exercise of purchasing back its commercial debt at a discount of nearly 97 percent off the face value, the deepest discount ever negotiated on a developmental country's commercial debt. This means that Liberia will now be able to take US$1.2 Billion of debt off the Government's balance sheet, according to Minister Ngafuan. Narrating the processes that led to the huge reduction, Minister Ngafuan mentioned that the buyback occurred with the strong support of international partners, who provided the US$38 million needed to complete the operation, noting that the World Bank provided half of the financing for the buyback.
He maintained that the World Bank's Debt Reduction Facility provided the mechanism for other partners to contribute and to conclude the operation. Minister Ngafuan also told journalists that President Sirleaf met with World Bank President Robert Zoellick yesterday in Washington D. C., USA to express Liberia's gratitude for the debt reduction success and to explore further avenues of cooperation with the world financial body.
Meanwhile, Minister Ngafuan said the remaining debt will be cancelled when Liberia reaches its completion point under the Heavily Indebted Poor Country (HIPC) initiative; something he intimated would probably be met by next year. "Let me say that we at the Ministry of Finance can assure the Liberian people and international community that we continue to work tooth and nail to ensure that our debt burden will be removed from our backs so that we can fully re-engage with the global economic community and continue to rebuild our beloved country," he emphasized.