Why Is Government Refusing to Disclose What Kind of Loan Collateral It Is Offering to Its Creditors?

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Hardly has the dust settled over the proposed US$536 million loan with the relatively unknown Eton Finance of Malaysia when news have again surfaced of yet another loan this time to the tune of US$426 million. Put together, the total amount the George Weah government, in just about six months of its existence is proposing to credit money from institutions and individuals with rather obscure financial ratings, is a little over 1 billion US dollars excluding interest. But the government has steadfastly refuse to disclose the size or kind of collateral it is offering to its creditors.

We recall for example, the response of the government to widely publicized media reports of President George Weah’s acquisition of a private jet valued at US$30 million, whose official spokesperson quickly dismissed the reports as untrue saying the plane did in fact belong to a friend of the President who had made it available to facilitate his foreign travels and “boost his morale” in the process.

Now the public has come to learn the bitter truth that the friendly ties subsisting between their President and this Burkinabe businessman to the extent that he would provide a private jet plane at the disposal of President Weah is being driven by prospects of a whopping US$426 million contractual pre-financing loan agreement between the businessman’s private company and the Government of Liberia.

And according to information received by this newspaper, the Burkinabe businessman is proposing to pre-finance the construction projects based on collateral provided by the government of Liberia. On several occasions, this newspaper has asked the various government officials to provide indications or come out definitively to say just what kind of collateral or “sovereign guarantee” the government of Liberia is putting up in order to secure such huge amounts of money to be spent by public officials whose integrity records leave much to be desired.

Liberians must not lose sight of the fact that former President Sirleaf left a debt burden close to one billion US dollars owed mainly to creditor institutions like the World Bank and the International Monetary Fund. These were the very institutions who played a major role in securing debt forgiveness to Liberia through delicate and often tedious negotiating processes. Unlike the Eton Finance and the Burkinabe Company, who operate by their own rules, the World Bank and International Monetary Fund has established frameworks through which loans as well debt forgiveness can be arranged.

As we saw in the case of the airplane allegedly bought for use of President Doe under obscure arrangements, an unscrupulous Liberian businessman Emmanuel Shaw sued the Government of Liberia and sought to place a lien on the maritime funds in order to pay back the loan negotiated for the purchase of the plane. In the case at bar, the Liberian public is still in the dark as to what kind of collateral this government is offering as collateral for the loans they are seeking to incur on behalf of the poverty stricken people of Liberia.

If care is not taken, the Liberian people may one day wake up to find out that the very land beneath their feet has been sold. For reasons we do not understand, the relevant government officials involved with the arrangement of these loans have shown very little interest into disclosing just what the government of Liberia is offering as collateral for both loans totaling a little over US$1 billion.

Already, the country finds itself tottering beneath the burdens imposed by failed concession agreements signed by the administration of President Ellen Johnson Sirleaf, from which the country has benefited virtually nothing. As a consequence the Liberian people must now place their hopes in their legislators who they elected to represent, defend and protect their interests.

As Article 7 of the Constitution reminds us, “The Republic shall, consistent with the principles of individual freedom and social justice enshrined in the Constitution, manage the national economy and the natural resources of Liberia in such manner as shall ensure the maximum feasible participation of Liberian citizens under conditions of equality as to advance the general welfare of the Liberian people and the economic development of Liberia”.

And now that both proposed agreements have reportedly surfaced at the Legislature for approval, we prevail on our legislators to do the country right by exercising sufficient due diligence to ensure that this time around it will not be business as usual, passing into law agreements replete with unforeseen consequences for the future of this country and generations yet unborn.

As a first step they should demand public revelations of just what collateral the government is offering for the loans which they (Legislators) would have to approve. They must insist that accountability mechanisms for the management and control of the loan portfolio are watertight and that the terms of the proposed agreement do not compromise national control over our natural resources or revenue generating institutions.

Anything short of the contrary will simply indicate that our elected representatives are not in the interest of the Liberian people. They must be guided by the lessons of history as taught to us by the fiascos of the 1871 E.J. Roye as well as the 1926 Firestone loan agreements and more recently under President Doe, the dispatch of 17 US financial experts to manage the country’s finances.

Under a draft contract agreed to by President Doe, the 17 Americans were to wield co-signing authority in several key ministries and state corporations: finance, commerce, planning, the central bank, the national oil company and the produce marketing company. ”The concept is not to put financial experts in every ministry, but to focus on where the money is flowing in and out,” an American official said at the time. They were charged to virtually sign all lease agreements, purchase orders, checks and payment documents.

As things currently stand, all hopes now remain rested in the Legislature to arrest what promises to be a grave travesty of justice against the interests of the Liberian people. We recall the deprecating comments carried at the time in the New York Times in its April 26, 1987 edition.

The comments read, “ In this land on the west coast of Africa where ”eating money” – stealing public funds – is a time-honored tradition, the United States has accepted a rare invitation to play financial diet doctor. Taking a role usually reserved for former European colonial powers, the United States has agreed to send 17 ”operational experts” here this summer to take control of the Government’s finances”.

Just how much has changed since then is a question which comes readily to mind when we are reflect on Vice President Jewel Howard Taylor’s remarks to Bong County District Commissioners, “This is our time to eat. We will eat but we are going to do it in a way that everybody will be able to eat.”

Therefore are these proposed loan agreements and the cloak of secrecy shrouding their details now signaling that the time for the CDC to “eat” has now come?

God forbid!

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