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U.S. Forgives Liberian Debt; Now Only a Few Billion More to Go
February 14, 2007 By Alison WilliamsPresident of Liberia Ellen Johnson Sirleaf—the first elected female head of state in Africa—spoke in Washington on Monday about the progress and challenges to development in her country. Efforts to expand development beyond the capital city of Monrovia (electricity and running water only recently returned after a 15-year hiatus) have been hampered by time spent pleading with international lenders to forgive the odious debt incurred during Charles Taylor’s regime.
Debt forgiveness seems like a no-brainer for a country that has shown remarkable progress in development and democracy, despite being written off not long ago as a decidedly failed state. So I was pleased to see Condoleeza Rice’s statement today, announcing that the United States will cancel $391 million of Liberia’s debt.
This is only a start though. Liberia’s total external debt is 3,000 times greater than the revenue of its exports. Without further forgiveness, the country will not be able to implement many (or any) of the plans Johnson Sirleaf spoke so passionately about during her U.S. visit: secondary road construction to revive trade in natural resources and agriculture, health care and education, and increased stability and security.
Surprisingly, Johnson Sirleaf focused very little on the role environmental resources played in Liberia’s decline. Charles Taylor partly financed his dictatorship and the war with Sierra Leone with revenues from timber, and the lifting of timber sanctions by the UN Security Council is arguably one of Johnson Sirleaf’s greatest accomplishments. Yet reference to timber was oblique; committing to better overall resource management, she said: “We are trying to build a country where our natural resources are used for the benefit of all.”
Similarly, diamonds—for which sanctions have yet to be lifted—were only briefly discussed. Johnson Sirleaf acknowledged the country is still struggling to comply with the Kimberly Process. And finally on the resource angle, Mittal Steel’s new contract for iron ore was a big focus point. It is an interesting new development if only because the company is one of the country’s few private investors—and at $1 billion, the contract is by far the largest.
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