EU Provides US$7M Budget Support to Gov’t

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Signed in May 2018, the transaction was the first under the EU's new budget support programme, called "Moving Liberia forward – Improving service delivery and public investment". Flashback: Finance Minister (right) Tweah signs the financing agreements on behalf of the Government of Liberia, as the EU Ambassador Cavé looks on.

The Government of Liberia (GoL) has received a little relief in the amount of EUR 6 million in budgetary support, provided by the the European Union, amidst the huge resource challenges that the country is faced with.

The EU transferred a non-reimbursable grant amounting to EUR 6 million (around USD 7 million) to the Coalition for Democratic Change Administration at the end of August, a release from that continental body disclosed earlier today.

This grant, however, arrived on 12 September 2018 in the GoL revenue account to support the budget of the Republic of Liberia.

The transaction was the first under the EU’s new budget support programme called “Moving Liberia forward – Improving service delivery and public investment”, the release noted. The agreement was signed in May 2018, following the inauguration of President George Manneh Weah after a peaceful 2017 Liberian legislative and presidential elections that led to the first transition of power from one democratically elected leader to another since 1944.

The program, which is part of the 2014-2020 National Indicative Program, was already adopted by the EU Member States in November 2017 and covers three years.

Disbursement of this first payment comes after a positive decision of the Budget Support Steering Committee of the European Commission’s Directorate-General for International Cooperation and Development in July 2018.

The EU budget support offers a platform for dialogue with the partner country (Government, national oversight bodies, civil society, private sector, and other stakeholders) on policies and their financing, objectives and results, consistent with the principles of ownership, transparency and accountability.

Ambassador Hélène Cavé, Head of the European Union Delegation to Liberia, said: “I am very happy that we managed to provide this EUR 6 million budget support to the Government. We hope it will help to move Liberia forward and put people first by providing essential services and investment to the benefit of Liberian citizens who are facing challenging times. Sound economic policies and the formulation of a realistic pro-poor agenda will be at the heart of our policy dialogue in the coming months.”

She added “Budget Support is another instrument the EU uses to strengthen good governance, accountability and transparency in addition to our projects supporting external audit implemented by the General Auditing Commission (GAC) and access to information.”

Meanwhile, the State-building Contract has a total value of EUR 27 million (approx. USD 31.5 million) over three years. The EU contribution is allocated as follows:

EUR 24 million – General budget support
EUR 3 million – Support measures in the areas of Public Financial Management and statistics

Indicative timeline for disbursement:

2018 – EUR 6m fixed tranche subject to meeting general conditions for EU budget support
2019 – EUR 3m fixed tranche subject to general conditions, EUR 6m variable tranche linked to specific conditions
2020 – EUR 3m fixed tranche subject to general conditions, EUR 6m variable tranche linked to specific conditions

The general conditions of the Financing Agreement are:

  1. Formulation, approval and satisfactory progress in the implementation of a successor public policy  and continued credibility and relevance thereof;
  2. Implementation of a credible stability-oriented macroeconomic policy;
  3. Satisfactory progress in the implementation of PFM Reform Strategy and Action Plan;
  4. Satisfactory progress with regard to the public availability of timely, comprehensive and sound budgetary information.

The six specific conditions are related to the following domains and indicator headings:

  1. Domestic Revenue Mobilization
  2. Business climate: Trading Across Borders
  3. Budget credibility for service delivery: Spending Entity Performance
  4. Improvement in access of de-concentrated services: De-concentrated service delivery through County Service Centers
  5. Improved controls, prevention and prosecution of corruption: State of procurement practices of Ministries and Agencies and management of public investment
  6. Transparency: Asset declarations of public officials

In both 2019 and 2020, EUR 1 million is linked to each specific condition.

3 COMMENTS

  1. The cross border condition should be observed thoroughly. Regardless the domain, This EU woman could be making an offer just to use Liberian exchange ratings or goods and services out flow to profit personal interest in Europe as long as the money jumps the line. Make sure Liberian money comes back immediately same timing when U.S. Dollars leaves this domain. Are they paying in Euro or American Dollars? As for domestic spending its has little sense if its satisfies local markets. Do not enter.
    Praying.

  2. Do you mean “transparency” of EU and Liberian public officials processing the implementation of these financial agreements? Or are you committing the entire Liberian Government into a none repairable glitch? Answer Liberians. Not me.
    Silent majority.

  3. It’s interesting that while Liberians across the world are asking for forensic audit and clearity about the disappearance of US106M, the Liberians Government is seeking US7M for budgetary support. These shameless spin-masters are not ashamed of their inconsistant and ever changing stories about Liberia’s missing containers of LD16B. It’s unfortunate that those elected to provide oversight responsibility, ensure transparency, accountability, honesty and integrity are themselves culprits in the robbery of the Nation. I’m yet to hear or see an honest “Honorable Man or Woman” in the National Legislature of Liberia to speak out forcefully about the unfolding situation. This is not a partisan or political party issue, this is about the integrity of the democratic institutions of our Nation. I encourage all patriotic Liberia, ordinary or government officials to join in on our efforts to openly question and demand this government to account for the missing 16B.

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