Liberia CAN emerge stronger if we act now!!!
By Robert E. Smallwood Jr.
A few weeks ago we were all focused on the apparent contradicting statements, relative to availability of fuel and gas, from the Minister of Commerce and LPRC. Called before a Senate committee hearing, Min. Tarpeh made a sobering statement which, I believe, requires urgent focused, accelerated and timely actions. The global economic impact of the coronavirus will almost certainly have a crippling and altering impact on Liberia’s economic landscape. The question really is, how devastating will it be?
I was encouraged by ongoing discussions at the Legislative and Executive levels around potential economic stimulus initiatives aimed at cushioning our economy against the certain economic fallout from the virus. In my view, the coronavirus poses an existential treat to our very existence as a people and as an independent nation. I feel obliged, as a citizen, to offer my thoughts for consideration as needed policies are being formulated.
The economies of our major trading partners, friendly nations and donor nations have come, or are, grinding to a halt. To date $7 trillion US dollars have been announced as economic stimulus initiatives to fend off possible recession. The truth is, considering the unprecedented nature of the virus, no model and/or analysis exists to quantify the full impact of the virus on the global economy. I agree with Min. Tarpeh. In the next 12 to 18 months, we, in Liberia, could likely experience significant fuel and gas, rice, and other commodities shortages. Dwindling tax revenue intake coupled with eroding and/or pause in donor budgetary support could likely cripple Government spending. Significant salary delays, delayed payments to local vendors and service providers payment are also likely. These likely events could have dire consequences of unimaginable proportions.
Liberia, as a small economy, with urgent and immediate actions, can emerge stronger and well positioned post-coronavirus.
Considered and urgent monetary, fiscal and administrative measures are needed now. I humbly provide the below suggestions to aid the ongoing discussions at the highest levels of Government to drive appropriate actions to forestall the pending economic impact of the virus.
Monetary measures for consideration
- The halting of small businesses’ loan interest payments for 3 to 9 months and the restructuring of medium and large business loan interest payment.
- Reducing bank fees on money importation.
CBL’s leadership in partnership with all financial institutions will be critical.
Fiscal measures for consideration
- Halting customs duties on all imports for 6 months as a stimulus to the hospitality, foods and merchandise sectors. This sector will likely be the hardest hit by the virus.
- Granting employment tax credit to businesses for every new hire.
- Granting tax waiver and/or tax credit to landlords in exchange for tenants rent waiver.
Other Administrative measures for consideration
- Granting investment based multi-year work and resident permits to foreign business operators/investors linked to new investments.
- Provide Government purchase guarantee for agricultural products grown in Liberia.
- Reducing LEC / electricity buy cost. This could be achieved by restructuring existing grants, financing, etc.
The coronavirus is unprecedented in scope and impact and, at this stage, unquantifiable. The global economic impact will be as have never been seen or experienced before. Critical and immediate actions are required for our (Liberia) survival as a people and as a nation. Liberia can and must emerge stronger if and only if we act NOW!!
IN UNION STRONG, SUCCESS IS SURE. WE WILL OVER ALL PREVAIL!!!