.... Gov’t, World Bank Sign a financing agreement for the Liberia Investment, Finance, and Trade
The Ministry of Commerce and Industry and World Bank Group on April 4, signed a financing agreement for the Liberia Investment, Finance, and Trade (LIFT) project in the amount of US$40 million of which $20 million is an IDA grant and $20 million is a concessional IDA credit.
The signing ceremony, which brought together representatives from Government Line Ministries and agencies, including the Ministry of Finance and Development Planning, Liberia Revenue Authority, Central Bank of Liberia and Ministry of Commerce and Industry, was held at the Ellen Johnson Sirleaf Ministerial Complex in Congo Town, Liberia.
The project is intended to provide a line of credit for Small and Medium Enterprises (SMEs), as well as build their capacity to access markets over the next five (5) years and will directly support over 750 SMEs by providing a customized suite of services, including coaching, training, market linkages, investment facilitation and finance. Through the LIFT project, the Government will strengthen the capacity of the National Investment Commission (NIC) and the Inter-Ministerial Concession Committee to attract large investors and negotiate investment agreements in order to get the best deals for Liberia.
It will also establish the Liberia Special Economic Zone Authority that would guide the activities of establishing special economic zones and industrial parks, among others.
Dr. Khwima Nthara, World Bank Country Manager for Liberia, who spoke at the signing ceremony of the financing agreement, disclosed that the agreement signed yesterday marks yet another important milestone in the development partnership between the World Bank and Liberia. The financing was approved by the World Bank’s Board on February 9, 2022.
He said, “This is the first time the World Bank is providing such a significant amount of financing to support programs for improving the investment climate for the private sector. This is in recognition of the significant progress that the Government has made in stabilizing the macro-economy over the past three years.”
Dr. Nthara added that the signing was a result of Liberia being removed from the World Bank’s list of countries categorized as Fragile and Conflict-affected Situations (FCS) after an improvement in the country’s overall rating under the World Bank’s Country Policy and Institutional Assessment (CPIA).
“Ladies and Gentlemen, like I said during such ceremonies, the executive branch has done its part in mobilizing these substantial amounts of resources that will transform the lives of Liberians. It is now up to the legislature to ratify the financing agreement as soon as possible so that implementation can begin and the people of Liberia can start reaping the benefit. We look forward to the successful implementation of the LIFT project and you can count on the World Bank’s continued support,” he said.
Additionally, he said, Government will create a one-stop-shop for business registration and licensing and automate the process so that it becomes easy to start a business in Liberia; through the LIFT project, simplify and automate the process of exporting and importing goods by creating a National Single Window for Trade; through the LIFT project.
“As you can see, the LIFT project will be a game changer for Liberia. It sends a loud and clear message that Liberia is open for business and that it will be the investors’ destination of choice. Once again, by facilitating private sector investment, the project will contribute towards the creation of more and better jobs. That is why we believe that it is a project that every Liberian should have an interest in,” said Dr. Nthara.
Finance and Development Planning Minister, Samuel D. Tweah, who also signed on behalf of the government and people of Liberia lauded the World Bank Group for the initiative.
“Today is a great day that we are here to sign LIFT. The fact is that LIFT is the first World Bank project to address in a structural way the business and investment climate in Liberia.
Minister Tweah further added that the project is about small businesses that would enable them to have a stronghold in the processes of economic transformation — making sense that it is to be a Liberian business.
According to him, Liberian businesses have a number of problems and it is incumbent upon the government through relevant institutions such as the Ministry of Commerce, LRA, CBL and Ministry of Finance to be able to shoulder those challenges and solve them.
He said, “This structural financing project to the investment climate is another way for the government and its partners, the World Bank, to continue to work on those problems.”
Also speaking, Commerce Minister, Madam Mawine G. Diggs, lauded the World Bank Country Manager, Dr. Khwima Nthara and his dynamic team for the cooperation, support and look further to enhancing their partnership as they take a step forward to the next stages of the project.
She added, “Today is not just a great day for the Government and people of Liberia but for the Ministry of Commerce and Industry, who for the first time will be implementing a project such as a Liberia Investment, Finance and Trade Project (LIFT-P).
“When we took over the Ministry of Commerce, we stressed and made a commitment to ensuring that the President’s vision as laid out in the PAPD for an improved business climate, support and development of our SMEs, increase participation of Liberian businesses, trade and commerce of our country, strengthening and increasing the capacity of trade facilitation are delivers.”
She said, “So today is a manifestation that we have gone beyond not just that commitment to taking substantial steps to making the lives of our people better following the massive destruction to trade and the economy as a result of the covid-19 pandemic.
“The LIFT-P and other projects implemented by the Ministry of Commerce and Industry as well as other agencies of government will complement government economic recovery programs and policies aimed at supporting SMEs and the general business outlook of the nation.”
The Commerce Minister further assures her colleagues of the Ministry’s commitment to the full implementation of the project and looks forward to the development of similar projects to address other programs of the Ministry of Commerce that are planning to roll out.
However, Minister Diggs, used the occasion to challenge her team at the Ministry and others not just to take the program likely but they should implement it to the fullest extent so that they can be able to get the desired result and encourage similar programs to be implemented and supported here in Liberia.
For his part, Deputy Governor of the Central Bank of Liberia for Economic Policy, Musa Dukuly, who spoke on behalf of his boss, J. Aloysius Tarlue, Jr., expressed delight for the project because it has implication of supporting the country’s economy, especially giving access to finance which is a major constraint that Liberia is confronted with irrespective of Ease of Doing Business in our country.
Dr. Dukuly said, “When we look at the financial indicators at the CBL, we see that private credit to GDP is less than 15%, which is low comparative to other countries' standards.”
He further lamented that the country financial index is around 36% and their target is to take it to 50% between now to 2024, and “we think now that this LIFT project is in the right direction and is a game changer for Liberia and will support SMEs and to the greatest extend reduce poverty.”