Chamber president Wendell Addy tells business luncheon
Liberia Chamber of Commerce (LCC) president, J. Wendell Addy has promised that his leadership will promote a vibrant private sector. Addressing a room full of leading business executives on Thursday, October 4, at the Chamber’s first monthly business Luncheon in Monrovia, Addy said his administration is undertaking a number of steps to help address some of the issues that affect the business climate.
“What we are trying to do is to excite investment climate in the country,” Mr. Addy said, adding that the chamber is ready to work with all businesses. “We are ready to move forward, ready to lead the private sector.”
A platform for networking among private sector and policymakers, the business luncheon also allows government officials and International Partners to present their functional roles and address serious policy issues associated with doing business in the country.
This first luncheon featured a panel of three policymakers including Commerce Minister Wilson K. Tarpeh, Finance and Development Planning Minister Samuel D. Tweah and International Monetary Fund Country Director Geoffrey Oestreicher.
Minister Tarpeh promised to support a vibrant, competitive, rules-based, Liberian-involved business environment. He informed the audience that the Government of Liberia is making available US$1 million for loans to small businesses at affordable interest rates. On the higher level of the private sector, the Minister spoke of resuscitating special economic zones to accommodate manufacturing.
Mr. Tarpeh said the Ministry of Commerce looks forward to working with the Chamber of Commerce to improve the relationship between the two entities.
“This government believes very firmly in the power of the private sector as a driver of growth. We believe as a government that in order for the private sector to be vibrant, a meaningful determined Liberian ownership is critical to the drive of the private sector in this country,” Minister Tarpeh said.
Finance and Development Planning Minister Samuel Tweah said the challenges and opportunities for enhancing and sustaining a competitive and productive business environment compel a strong, consultative relationship between the government and multiple businesses operating in Liberia.
He also informed the business community that the MFDP resides at the center of the Liberian economy and the ministry has the mandate to formulate and institutionalize and administer economic development, fiscal and tax policies for the promotion of sound, effective and efficient management of financial resources of the government.
He pledged his commitment to enabling and sustaining the competitive business regulatory environment as the minister of finance and development planning.
“We need to establish a government and business joint task teams to resolve the binding regulatory constraints to business improvement, to walking the business walk as opposed to simply talking the talk. We have heard a lot of talk about business improvement in Liberia over the past 12 years. It is now time to walk the walk, we hope we can begin some of that walking here today,” Tweah told the audience.
He also announced that the long-awaited Pro-poor Agenda of the Weah Administration will be presented to the cabinet in the coming week, with the hope of launching it by November at the latest.
IMF Country Director Oestreicher gave more of an introductory treatment, highlighting the role of the Monetary Fund in Liberia. According to him, the IMF in Liberia exists to provide a three-prong intervention: surveillance, technical assistance and training, as well as financial assistance. According to him, the amount of financial assistance to Liberia by the IMF since 2008 stands at about US$1,200 million. On this note, he stressed that it is important to keep debt affordable.
He said though the IMF is most known for financial assistance, the institution also promotes economic stability and global growth by encouraging countries to adopt sound economic and financial policies. To do this, th IMF regularly monitors global, regional, and national economic developments. It also seeks to assess the impact of the policies of individual countries on other economies, he noted.
According to Oestreicher, over the past ten years, the Liberian economy has been challenged by certain factors, some of which are beyond the country’s control. These include the decline in prices of key exports; the withdrawal of UNMIL; and capital flight due in part to political uncertainty.
Following the panel presentations, the floor was open for the audience to pose questions to the panelists. A healthy exchange ensued, with audience members calling out burning issues affecting the private sector including, among other things, the need for a claims court and the prohibitively high import duty costs that impede growth of Liberian-owned businesses, especially those trying to scale-up local manufacturing. Many in the audience agreed that the cost of producing goods in Liberia — mainly due to duties and taxes — is so high that businesses are losing their customers to cheaper imported alternatives. Minister Tweah argued that Liberia has some of the lowest taxes and import duties rates in the sub-region, a point that many in the audience disagreed with.
What most people agreed on, however, was the need for affordable electricity, which could potentially drive down the cost of production and enable locally manufactured goods to be more competitive. The challenge to this is power theft, said panel moderator Monie Captan, CEO of the Millennium Challenge Account Liberia, which oversees the development of the Liberia Electricity Corporation (LEC). With LEC losing about 50 per cent of its revenue to power theft, and struggling to collect another huge sum in a backlog of debt from government subscribers, Captan said such conditions drive up the cost of the tariff for those who are actually paying their electricity bills.
Minister Tarpeh called this “a mindset problem”, where some customers are more prone to cut corners by paying bribes to receive utility services than going through the proper channels to subscribe to the same services. Just as well, some customer service personnel display unprofessional conduct in their discharge of duties to customers. According to the Minister, this causes the utility provider and even some of those very customers to lose money because of lack of accountability. If everyone, he said, went through the proper channels to subscribe to LEC, for example, the tariff would be much more affordable for everyone.