Finance Minister Amara Konneh has said the present state of the country’s economy has the propensity to achieve several developmental objectives.
Minister Konneh made the disclosure Tuesday, March 25, at a press conference held at the Ministry of Information, Culture and Tourism (MICAT) in Monrovia. He gave an update on the state of the Liberian economy and outlined developments made as well as challenges facing the government in improving the economy.
Min. Konneh said that Liberia’s real gross domestic product (GDP) recorded 8.1 percent estimated growth for fiscal year 2013; attributing it largely to increased activities in the mining sector.
According to him, the growth in Liberia’s GDP is expected to continue in the medium-term, especially with the export of iron ore by China Union and the increase of production by ArcelorMittal.
He noted that the increase of export in the extractive sector is a result of Liberia’s stable macro-economy, which attracts foreign direct investment that generates foreign exchange and creates jobs.
Minister Konneh said the government has projected a boost in tax revenue collection by about US$400 million per annum through an increase in the mining sector, which it has achieved by removing infrastructural and bureaucratic processes that hindered concessionaires from rolling out their operations.
This, according to Minister Konneh, would help increase employment opportunity for Liberians within the next seven to 10 years.
However, the Finance Minister said that the economy of Liberia partly experienced some difficulties in the second quarter of the fiscal year, as the Liberian dollar continues to depreciate against the US dollar. The GOL’s fiscal year begins July 1 and ends June 30th.
This, he said, was quickly brought to a halt by the Government through the effort of the Central Bank of Liberia (CBL).
He said this decline in the value of the country’s currency is a testament to the need to increase the country's exports and diversify the economy in a way that would enable the country to attract more foreign exchange.
He added: “If this is not done, we will remain dependent on large aid and security-related inflows, which are likely to fall over time and be subject to global demand and prices.”
Minister Konneh has meanwhile disclosed that the service sector, which is another driving force of economic growth, is expected to be hit as the United Nations Mission in Liberia (UNMIL) draws down its presence in Liberia, and as NGO activities start reaching lower levels.
According to him, this would cause a slowdown in domestic demand for services such as food, entertainment and domestic aid amongst others.