Through the Agenda for Transformation, the government had hoped to build more kilometers of roads and power lines as the binding constraints to growth are aggressively tackled. It was a year the Mount Coffee Hydro Power plant should have seen more work and the inter-connection project from Ivory Coast taking off the ground.
But suddenly everything was halted in its tracks. The terrifying and ominous sounds of ambulance sirens and body trucks led the way to an unprecedented exodus of investors, partners, contractors and citizens. Ebola was raging.
The health emergency that saw over four thousand fatalities in Liberia alone would have a profound effect on the country’s socio-economic development as it would on the way of life.
Roughly over a year, with normalcy taking hold, Capitol Insider looks at the impact and damage done to the country’s economy and how sound policy planning and aggressive resource mobilization was eased a crisis that could have permanently destroyed the economy.
Speaking to The Capitol Insider, Liberia’s Minister of Finance and Development Planning said the crisis had a collateral impact on the government’s development agenda but he was “confident the country has averted a much bigger problem and the AFT remains on course, though we might not meet some of our targets.”
As the Ebola virus continued to wreak havoc on the country, it was taking massive toll on the economy with three revised growth estimates from the International Monetary Fund pointing to negative 0.4% GDP. The IMF further projected a decline of roughly -2.8 percent in 2015, owing largely to slower growth and low economic productivity in the agriculture and mining sectors.
So just how Liberia managed to maintain economic stability when all seem lost. “We started off first by rallying the Economic Management Team and working as a collective we presented to the President concrete sets of proposal, including austerity measures that were needed to create the fiscal space for our budget implementation. Remember though Ebola had struck, we still had to run a functional government and this involves, paying government employees, keeping agencies opened and doing business as normal. “
“I think we take for granted the level of work we have done to keep our economy stable, particularly during the Ebola crisis. We worked aggressively in designing medium to long term measures that would ease the economic impact of the crisis and deliver the platform for stronger growth in the post-Ebola environment,” said Konneh.
These measures and the scrupulous implementation of the fiscal budget and strict adherence to the agreed fiscal rules helped the government managed the crisis without any serious financial consequences. He showed exemplary leadership by asking colleagues to accept budget cuts and reducing travel and other incentives.
As a result of sound fiscal policies, salaries for government employees including health workers have been paid on time and the operations of the government continue to function in the midst of the crisis.
To date, the government has seen over 700 million dollars in committed financing from several multilateral institutions and bilateral governments. The amount of pledged resources is about 303 million to date.
Directly through the budget, Konneh says the MFDP has mobilized over 250 million dollars to support its post-Ebola economic recovery program.
While a significant portion of these resources are still pending, the record time and relative ease with which these funds were mobilized has more to do with the planning and leadership shown by the MFDP.
Through resource mobilization, Liberia seems to have outpaced the virus having more capacity to deal with any outbreak compared to its neighbors.
Culled from The Capitol Insider Magazine