The Liberia Investing for Business Expansion (IBEX) Program has ended a two-day Experts’ Advice seminar for bankers, local business consultants and microfinance institutions on establishing safe practices and maintaining high ethical standards in their operations amid the Ebola Crisis.
IBEX, funded by the United States Agency for International Development (USAID), provides financial and advisory services to local businesses in various sectors including agribusiness, clean energy, hospitality, infrastructure, general merchandize trade, construction and logistics/ transportation.
Speakers during the seminar held from November 20-21 at the Corina Hotel in Sinkor were Boima S. Kamara, Deputy Central Bank governor for Economic Policy, John B. S. Davies, President, Liberia Bank for Development and Investment (LBDI) and Milton A. Weeks, Managing Director of Devin Corporation.
The bank executives made separate presentations on the topics “The Impact of the Ebola Crisis on the Banking Sector” and ”How Can Banks Employ Adequate Risk Management Practices, Contingency Frameworks and Financial Stability” in the country.
The financial experts said the Ebola crisis has negatively affected the banking sector and the overall economy.
They cited travel restrictions and quarantine measures as contributing factors to the loss of markets for goods and services, adding, there is a rising level of unemployment due to slowing down or closure of business activities; decline in deposits, especially during July–September 2014, a drop by 6.9 percent to 41.4 billion Liberia dollars at end-September 2014, from 44.5 billion Liberian dollars at end-June 2014. They fear the intensity of the impacts of Ebola on the economy if the crisis prolongs and various Government policy interventions were not made in resolving it.
“It is important and urgent that the right policy frameworks are formulated and implemented to ensure that financial services, particularly affordable and long term credit to the private sector, are provided to the critical sectors of the economy,” they said. According to them, the Liberian economy experienced significant declines in mining, services, and agricultural output; oil prices, domestic food production, export earnings largely from rubber and iron ore. Credit to private sector also declined because of weak economic activities and Non-Performance Loans, which also rose to 16.3 percent at end-September 2014, from 14.9 percent at end June 2013.
“As a result of CBL’s increased intervention in the foreign exchange market, resilience and prudent supervisory oversight the exchange rate and domestic banking sector remain relatively stable and all nine banks maintain liquidity positions, remaining above the regulatory threshold throughout the crisis,” Mr. Kamara pointed out.
For his part, Mr. Davies, who is also president of the Liberia Bankers Association, said the Ebola crisis provided the Banks an opportunity to review management practices and improve lending standards. To achieve this, he said, enhanced security and health measures were instituted to keep the banks operational and ensure safe working environments and the protection of their premises, staff and customers.
“At the core of our strategy as an industry we ensure that no customer is turned away and remain constructively engaged with the Liberia Bankers Association and the Central Bank of Liberia,” Mr. Davies added.
Devin Corporation MD Weeks told the participants that business ethics is all about doing the right thing, which requires businesses to create codes of conduct/ethics that describe acceptable and unacceptable behaviors for them.
“Organizations must take steps to enforce their codes of conduct/ethics and follow through with consequences for non-compliance.”
Mr. Weeks added that “Organizations that behave in an ethically positive way will enjoy a reputation among the public and projection of a good public image.”
Dr. Samba Kawa, Agriculture Development Officer/Agreement Officer Representative for IBEX at USAID Liberia, made the opening remarks. Dr. Samba said the seminar provided the platform to enable IBEX to get the experts’ views on contingency planning for local businesses that can guide them in their operations before, during and after emergencies such as Ebola.
“I am particularly happy for this session because if we fail to have this discussion we are failing to understand what will be the consequences of our actions and see how we can help local businesses grow to contribute to the resilience and development of their communities, Liberia and Liberians as a whole. ”
The seminar brought together 29 participants that included Credit, Portfolio and Risk Managements and / Relationship Officers from all nine commercial banks including DCA banks and 29 representatives drawn from several microfinance institutions and business development service entities in Montserrado and Margibi Counties.
At end of the seminar several participants thanked USAID for its continued support to IBEX and said the seminar was an opportunity broaden their understanding of how Ebola has negatively impacted the financial sector and SMEs borrowers. Earlier, IBEX Acting Chief of Party, Augustus J. Flomo, said his organization decided to bring together the key actors in the business development sector to discuss issues arising from the prevailing health situation in the country that will inform IBEX’s expert advice to other local businesses.