House to Approve US$957.2m Loans in 72 hours

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Some of the Representatives argue among themselves as to consequence of the loan

-But Loan Disbursement Begins Before Confirming Sovereign Guarantee

A US$420.8 million Financing Agreement/Loan, which was signed between the EBOMAF SA Company (Enterprise Bonkoungou Mahamadou and Fils) headquartered in Ouagadougou, Burkina Faso and the Government of Liberia, is expected to be approved today – Thursday, June 7, — by the House of Representatives.

The passage of the loan will make it the second loan to be passed within 72 hours, with the first loan, being ratified and approved on Tuesday, June 5, at the amount of US$536.4 million, which put the total of the two loans to US$957.2 million.

According to the Loan Financing Contract, the loans shall be disbursed in four tranches; and the first tranche of 30 percent shall be disbursed within 50 banking days after the confirming date of Sovereign Guarantee from the Central Bank of Liberia (CBL).

The Contract said the second tranche of 30 percent shall be disbursed following completion of 40 percent of the work and certification of the completion by the Project Owner Engineer. The 3rd tranche of 30 percent shall be payable following completion of 100 percent of the work and certification and the 4th tranche of 10 percent shall be payable as retention money payable within 18 months following completion of 100 percent of the work.

In yesterday’s public hearing, conducted by the House’s Joint Committee on Ways, Finance and Development Planning and the Judiciary, Public Work Minister Mobutu Nyenpan said the US$420,800,000 loan will finance the design, construction and supervision of road corridors in Monrovia (Somalia Drive – Kesselly Boulevard to Sinkor) and northern Liberia; Tappita – Zwedru road, including Toe Town to La Cote D’Ivoire border and Zwedru- Greenville.

Nyenpan said the US$420.8 million loan will construct 256.2 kilometer of roads, while the US$536.4 million will build 505.3 meter of roads and rest stops and roadside service areas, the construction of a vocational training center in Greenville, Sinoe County; and the construction of mini soccer (football) stadiums in Harper, Maryland County, Barclayville, Grand Kru County; Greenville, Sinoe County; Cestos City, River Cess County; Zwedru, Grand Gedeh County; Robertsport, Grand Cape Mount County and Bopolu, Gbarpolu County.

According to the technical specifications and detailed designs of the project, the Somalia Drive – Kesselly Boulevard to Sinkor-Monrovia is 16km; Tappita – Zwedru road (112km); Toe Town to La Cote D’Ivoire border (10.2km) and Zwedru- Greenville (185.5km).

“The construction period of the US$420.8 million, if approved, will be 36 months (3 years) from the day of commencement. And the day of commencement being three months after the deposit of the first tranche of the loan,” Minister Nyenpan said.

Deputy Finance of Minister Samurai Wolokollie said the US$420.8m loan is at an interest rate of 6.5% and shall be paid in 15 years with a five-year interest and principal-free grace period commencing upon receipt of the 1st tranche of the loan amount.

He indicated that the loan shall be disbursed through EBOMAF SA with its financial partners EBID and /or AFREXIMBANK.

Minister of Justice F. Musah Dean said that the US$420.8 million financing agreement was signed by the ministers of Finance and Development Planning and Public Works are authorized by law to execute the Loan/financing agreement for and on behalf of the Government of Liberia (GoL).

Meanwhile, it is expected that the report from the House’s Joint Committee on Ways, Finance and Development Planning and the Judiciary will be the 35th day sitting, today, and will receive a unanimous vote.

The Joint Committee, observers say, will argue that the report is timely and from all indications expresses the wishes of the Liberian people in terms of actualizing the GoL’s “pro-poor agenda” under its social infrastructure development.

Meanwhile,a member of the House of Representatives, Hanson Kiazolu, has expressed disgust at the actions of many his colleagues who, during debates on the proposed loans would openly declare that “this not the place for book business” meaning they should adopt the “so say one so say all” attitude. Such attitude is characteristic of corrupt public officials angling for kickbacks and other under the table payments says a former legislator who prefered not to benamed.

He recounted for example, during the battle to remove former Speaker Tyler from office, the vote to remove himwas influenced by under the table payment of 40,000 USD to each member of the House who signed the petition to remove Tyler.

According to the former legislator, the payout was done by a prominent Senator(name also withheld) A legislator, according to him, who refused was allegedly told by President Sirleaf that if he refused to sign his people would suffer, meaning that they would be deprived of development support.

In his opinion the haste with which the proposed loan agreements were approved suggests, within  the context of his personal experience, that money either changed hands or guaranteed assurances of payment were made which according to him may have induced what he termed as a hasty passage with unforeseen consequences in view of the non disclosure of the sovereign guarantee satisfactory to the loan providers.

2 COMMENTS

  1. Frankly, 72 hours too long; instead, 24 hours of debate before passage, and 365 days X 24 hours = 8,760 hours of nonstop oversight of how the almost US $1B is being spent!

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