Press Release No. 14/155

Press Release: Statement at the Conclusion of an IMF Mission to Liberia

April 4, 2014

A mission from the International Monetary Fund (IMF), led by Ms. Corinne Deléchat, visited Monrovia from March 17 to April 1, 2014 to conduct the third review of the government’s economic program supported by the IMF under an Extended Credit Facility (ECF) arrangement. The mission met with Minister of Finance Amara Konneh, Central Bank Governor Joseph Mills-Jones, and other high-level government officials. The mission also held constructive discussions with members of the donor community and the private sector.

At the end of the visit, Ms. Deléchat issued the following statement:

“Liberia’s economic performance in 2013 was strong and the outlook for 2014 is positive. Real GDP growth is estimated at 8.7 percent in 2013 reflecting increased iron ore production and an acceleration in private and public investment. For 2014, GDP growth is projected to moderate to about 6 percent, as mining output stabilizes.

“Budget implementation through December 2013 has been constrained by revenue shortfalls. The overall fiscal deficit is still projected to reach 3.8 percent of GDP in 2014 (fiscal year), as envisaged at the time of the last review, as the authorities were able to reduce current spending. The authorities are strongly committed to preserving current expenditure savings and to implementing decisive measures to raise revenue collection in the reminder of the fiscal year, including by addressing the backlog of taxes in the concessions sector and collecting fees owed by state entities.

“Addressing significant shortcomings that have emerged in the budget process and expenditure controls will be critical in the coming months. In recent weeks, it has become clear that that a significant number of road contracts were being implemented without corresponding budgetary allocations. The authorities are initiating external audits of the financial and technical aspects of these projects, and are working with relevant stakeholders to ensure commitments outside the budget do not occur again.

“The authorities have taken a number of measures to enhance Liberian dollar liquidity management to help contain exchange rate and inflationary pressures. This includes stepped up coordination between the Ministry of Finance and the Central Bank of Liberia to better manage the issuances of T-bills and CBL bills.

“Program performance has improved relative to the last review. Most end-December 2013 quantitative targets were met, and the authorities continue to make good strides in the implementation of their structural reform agenda. In addition, good progress is being made towards the benchmarks for the first half of 2014.

“The next phase of the program focuses on actions to strengthen the budget process and improve public financial management, boost revenue collection, and enhance the monetary and exchange rate policy framework. The authorities and IMF staff will continue discussions on these issues during the IMF-World Bank Spring Meetings in Washington next week with the objective of reaching an agreement, ad referendum, on a package of policies that would pave the way for completing the review. Once agreement is reached, and pending the regular internal review process, the IMF Executive Board consideration of the conclusion of the third review of the ECF-supported program is envisaged for end of June 2014.

“The mission wishes to thank the authorities for their hospitality and the quality of the policy dialogue.”