Liberia’s Post WTO Accession Dilemma

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The Government of Liberia’s (GOL) position on former Speaker George Dweh’s involvement in communications that sought to encourage the Republic of China (Taiwan) to establish a trade mission in Liberia and describing his action as a ‘scam’, now sets the stage for the nation to re-examine her commitment to maximizing the potential of Liberia’s WTO membership.

Maintaining that Dweh is neither an official at the Ministry of Foreign Affairs nor an envoy of President Ellen Johnson Sirleaf, GOL expressed seriousness of Dweh’s action and “alerted the relevant security agencies to investigate the matter in order to avert a diplomatic faux pas with the friendly government of the People’s Republic of China (PRC),” a statement from the Foreign Ministry said.

The Daily Observer examined the implications of Liberia’s membership to the WTO and discovers an interesting dimension about the country’s responsibility to do business with all the 164 members of the WTO, including Taiwan, which has been a member since 2002.

The accession of Liberia to the World Trade Organization (WTO) on July 14, 2016, which was described as momentous, was also hailed by the world community as a milestone for the country. Becoming the organization’s 163rd member, trade ministers of the 164-member WTO said Liberia’s accession would lead to economic growth.

Former US Ambassador Linda Thomas Greenfield said in a statement: “As to the benefits from lowered trade barriers to exports, look no further than the results of the African Growth and Opportunity Act (AGOA), which promotes trade with the United States. In 2014, non-oil AGOA trade was valued at
US$4.4 billion, a 250 percent increase from 2001, the first full year of AGOA. That trade supports an estimated 300,000 direct jobs in Africa. Just as AGOA has contributed to trade growth in Africa by providing expanded duty-free access for exports from the region, WTO membership will provide similar opportunities for Liberia.”

Now, Liberia’s dilemma is the interest that has been expressed by Taiwan to establish a trade mission in Monrovia now that Liberia is a member of the WTO and is able to do business with all countries.

Liberia recognizes the one-China Policy that the People’s Republic of China religiously holds on to, to ensure that the Chinese people are not divided by outsiders. A foreign ministry release against Dweh’s role published yesterday reaffirmed Liberia’s commitment to the “One-China Policy” and its support to China’s concept of “one country, two systems” and every effort by the Chinese Government to achieve national reunification.

A recent letter sent by Taiwan through the Liberian Embassy in Nigeria and forwarded to the Ministry of State and to the International Cooperation Bureau at the Ministry of Foreign Affairs says that Taiwan wants a trade mission with Liberia. However, the government has shown no interest in Taiwan’s request, and there has not been any official explanation regarding trade links with Taiwan. A question that confronted the Daily Observer was: If Liberia establishes trade links with Taiwan; does it mean it recognizes two Chinas? “I don’t think we should take it that way,” said an administrative official yesterday who asked not to be identified.

Though officials are not talking about the situation, some have privately informed the Daily Observer that the People’s Republic of China (PRC) is too useful to Liberia to create any misunderstanding with this partner since Liberia officially recognizes the one-China Policy and supports the PRC in the unification of the Chinese people, ironically adding that the trade mission with Taiwan does not mean Liberia would contravene the one-China Policy. With the government’s lack of interest in the Taiwanese trade mission, Liberia may be going contrary to the spirit of the WTO to trade with all members.

However, while some Liberians spoken to by the Daily Observer appreciated the People’s Republic of China’s colossal support to Liberia, evidenced by numerous ongoing infrastructural, educational and medical projects around the country, with the latest being the new airport terminal with a loan of USD50m as well as PRC’s generous support to Liberia during the fight against the Ebola epidemic, “We feel that establishing only a trade mission with Taiwan that would involve agriculture, mining, and transportation should not be discouraged because these are the areas in which Liberia needs investment and capacity building for its citizens.”

Sources told the Daily Observer that the letter from Taiwan requesting a trade mission was sent several months before the death of Minister of State without Portfolio Edward McClain, with copies sent to the Ministry of Foreign Affairs’ International Cooperation Bureau. Daily Observer’s attempt to get official confirmation did not succeed and it seemed that the government has officially overlooked the request.

Taiwan acceded to WTO membership on January 1, 2002, which opened the way for it to trade with all member countries, including Liberia. Though there is no official position regarding PRC’s take on other countries trading with Taiwan, it should be noted that the People’s Republic of China promotes peaceful relations, including stronger economic ties, with the current Taiwanese government that aimed at unification through the one country, two systems formula or maintaining the status quo under a 1992 Consensus Agreement.

Administration officials have stated again and again, including Vice President Joseph N. Boakai, that Liberia’s economic success would depend on massive investment in agriculture; and many knowledgeable Liberians interviewed said a trade mission with Taiwan could provide what Liberia needs to explore and achieve adequate rice production, fisheries, cocoa and coffee production, pineapple, palm production, animal husbandry and massive investments in cement and general building materials, as well as helping Liberians to explore and exploit those markets.

So, why is the government not taking the Taiwanese offer? Dweh told the Daily Observer in his defense that he was recommended by a friend to the Taiwanese to ensure that the trade mission was established, which could only happen with the Liberian government’s approval.

During an investigative visit to Deputy Director Fred Johnson of the WTO office at the Ministry of Commerce in Monrovia, he said there are ‘Laid Down Rules’ (LDR) for Trade Without Discrimination (TWD), which involves non-discrimination in trade embodied in provisions relating to: (i) Most Favored Nation
Treatment and (ii) National Treatment, which calls for “Favoring One, Favoring All.”

An official from the Ministry of Foreign Affairs, who asked not to be identified, said “Legislative reforms required as part of the WTO accession process can result in rapid improvements in the domestic business climate, which in turn could attract domestic and foreign investments. Through better integration into the global economy, trade can be used as an engine of economic growth and development and a tool towards the reduction of poverty.”

And with the Taiwan Trade Mission trying to court Liberia from the back door, some Liberians are hoping that the government would listen and take a chance to explore what Taiwan can offer Liberia in the spirit of Liberia’s membership to the WTO, while striving to rebuild its economy and infrastructure.

Since the news was reported yesterday, there has not been any official response from the Chinese Embassy, near Monrovia. “It is the Liberian government that has made its position clear on the issue of trade links with Taiwan which many people don’t understand when Taiwan also is a member of the WTO. Are the Chinese saying no one should do business with Taiwan? And what should that mean to us?” a Liberian government official said.

Some experts agree that Liberia’s entry into the WTO will help build confidence in Liberia’s growing economy and reduce poverty. The Director General of WTO, Roberto Azevêdo, stated: “Liberia’s accession to the WTO will have a big impact, and it suggests to the world that Liberia is open for business.

It also shows the country’s determination to attract foreign investments and puts the power in your hands to create jobs, increase the income and improve people’s lives.”

According to the WTO, benefits Liberia would accrue include reduced cost of living, reduced trade barriers with other WTO member states, and lowered costs of imports in production that will result in lower prices of finished goods and services. There will also be more goods and services to choose from, and broader range of qualities since the doors are now open for all the 164 member countries to do business with Liberia.

“The World Trade Organization promotes trade liberalization; and as a member of the comity of nations, Liberia’s relations with other nations include trade,” stated a report by the Joint Committee on Commerce and Industry, Foreign Affairs and Judiciary, headed by Rep. Charles K. Bardyl, Chairman on the
House Committee on Commerce and Industry. “Liberia is a post-conflict country with many developmental challenges. The way to surmount these challenges is to explore our untapped potential as well as showcase our national resource endowment, particularly taking advantage of the platform provided by the WTO.

“With the enunciation of the Vision 2030 and the Agenda for Transformation (AFT) by the Government of Liberia, which inculcate new development frontiers, Liberia stands at a great advantage when the WTO statute is utilized,” he said.


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