“As laid out in the Agenda for Transformation (AfT) and Liberia RISING 2030, and the World Bank Group’s goals of ending extreme poverty and boosting shared prosperity, Liberia’s financial sector plays a critical role in its economic development,” she noted.
Leshchenko, however, pointed out that the emergence of a more diversified economy that generates jobs is constrained by several factors, including limited access to finance, particularly for the agricultural sector which has the potential to generate employment and enhance food security.
The World Bank Country Manager’s statement was contained in a speech delivered on her behalf by World Bank economist Daniel Boakye at the launch of the Financial Sector Development Implementation Plan (FSDIP) at the Monrovia City Hall recently.
She indicated that well-functioning financial institutions and markets contribute to growth, shared prosperity, and poverty alleviation through multiple channels.
Leshchenko added that financial institutions and markets also play a fundamental role in the delivery of essential infrastructure such as roads, power plants, schools, and housing as well as generate growth and jobs by allocating scarce resources efficiently and allowing dynamic firms to start, grow, and innovate.
The World Bank official explained that finance also helps people manage their resources, expand their opportunities, and improve their living standards.
She noted that finance is clearly important for development and as such the FSDIP provides a comprehensive and clear roadmap on how to strengthen the financial sector, and increase its contribution to Liberia’s development.
She, however, observed that there are challenges to face, including low levels of access to finance, particularly rural areas, as only 17.6% of adults have accounts with a commercial bank.
Other challenges include the low profitability of the banking sector, high level of non-performing loans and the loss of correspondent banking relationships, Leshchenko said.
She said despite these challenges, Liberia has the opportunity to increase financial inclusion, increase the contribution of the financial sector to Liberia’s development.
The World Bank Manager said the introduction of mobile money holds “great potential” to increased access, particularly in remote areas not covered by formal financial institutions.
“Recent investments in modernizing financial infrastructure, payment systems and a collateral registry, also hold great potential in Liberia,” Leshchenko said.