Finance Minister Amara Konneh has told lawmakers of the House of Representatives that he and his team are making progress in the collection of government revenue despite the challenges contrary to allusions by those he calls “critics”.
Minister Konneh told the Plenary of the Lower House that when he appeared before that august body on January 21 this year, the total revenue collected as at January 17, 2014 was US$278.3 million.
The Finance Minister indicated that given the work that functionaries of the government have done together since that time, the total revenue collected as at May 12, 2014 is US$425.8 million, adding that this is a US$147.5 million increase since his last meeting of January 17, 2014.
He made the assertions on Tuesday, May 13, during a public hearing at the House of Representatives as regards shortfalls in the National Budget of fiscal year 2013/2014.
“This information,” according to the Finance Minister, “shows only one thing, that we are making progress in the face of challenging times.”
“Permit me to remind us that when we submitted the draft Budget on April 30, 2013, the total estimated revenue was US$553 million. By the time the Budget was approved, that amount had risen by US$29 million to US$582 million,” he told lawmakers.
He further stated that before the budget was approved, every one of them, including lawmakers, knew, that US$1.5 million captured as social contribution from offshore oil companies was not likely to come through because those estimates were not supported by the production sharing contracts.
“However, we agreed that we should announce the US$582 million and then during implementation we will adjust the revenue envelope accordingly,” Minister Konneh explained.
The treasury boss also added that when the budget was submitted, the exchange rate was L$75 to US$1.
However, according to the Minister, because of the present exchange rate, which stands at L$90 to US$1, if the Liberian government collected all the revenues projected in the budget, there would be a “shortfall” of roughly US$7 million.
Minister Konneh further explained to the lawmakers that with a noticeable slowdown in economic activities in the region, including Liberia, the country’s economy is exposed. He, however, maintained that in spite of these challenges, “we have taken several measures to mitigate the overall impact on the economy, and I have brought a detailed spreadsheet for your review, which shows what we have done.”
Before the Minister began his explanation about the state of the nation’s economy, with the approval of the Speaker of the House of Representatives, he presented to lawmakers a spreadsheet, which indicated, according to him, that only US$167 million remains to be collected for this budget year.
“I have highlighted areas where I believe your assistance will be invaluable to meeting the targets we consider to be realistic. I classified the areas as either “Uncollectible, Delayed or Risky,” Minister Konneh pleaded.
According to the Minister, the total amount was estimated at US$70 million.
He stressed that “for an economy that has survived largely on demand fueled by UNMIL’s presence and International NGO activities, no one needs to tell us that the withdrawal or slowdown of these major actors will have adverse economic impact on us.”
“In 2010, aid accounted for over 127 percent of our Gross National Income (GNI), peaking at $1.4 billion. In 2011 and 2012 respectively, aid as a share of our GNI fell to 53.8 percent amounting to 4764 million, and 36 percent totaling $570 million, respectively. Moreover, the Government of Liberia’s slowness to ensure the operationalization of major concessions is hindering the reversal of the decline in aggregate demand in our economy. We can cry the slow progress and debate all we want, but that does not help us move forward,” Minister Konneh said.
Meanwhile the Finance Minister reluctantly accepted responsibility for the revenue crisis. He added, however, that his acceptance does not suggest that he is the lone guilty party or he is inefficient or incompetent.
The Finance Minister also failed to extend apology to the Legislature for the Finance Ministry’s press statement to lawmakers’ call for his resignation. In the press statement, it is said by some lawmakers, including Representative Isaac Roland that the Ministry allegedly used profanities on as they performed their legislative duties.
After hours of closed-door discussion on the way forward, the legislature emerged with a decision to have the Minister apologize in seven local dailies.