Rédaction Africa Links 24 with New Dawn
Published on 2024-04-19 02:34:00
Former President George Weah’s request for a loan from the Central Bank in December 2023 has sparked a new political discussion in Liberia. While the exact amount was not specified in the letter, it has been reported that the loan provided to the government for civil servants’ salaries was US $32.8 million, not the US $83 million claimed by some individuals, including Gbarpolu County Senator Amara Konneh.
The US $83 million figure that has been circulating includes loans that were accumulated and transferred to the Government of Liberia’s Payroll account by the Central Bank from June to November 2023 to cover civil servants’ salaries.
Senator Konneh, in a social media post, alleged that the Central Bank loaned the Weah administration US $83 million in December 2023 alone, citing a letter from former President Weah’s Chief of Staff, J. Wesseh Blamo. He argued that this action violated the Constitution, the Public Financial Management Law of 2009, and the Central Bank of Liberia Act. However, it is important to note that the PFM law applies specifically to the Ministry of Finance and Development Planning and does not encompass the operations of the Central Bank.
Further investigations revealed that from June to November 2023, US $50.2 million had been disbursed for civil servants’ salaries. This amount had accumulated, leading the Central Bank to write a letter to the then Finance and Development Planning Minister Samuel Tweah to address the government’s growing debt to the bank. Minister Tweah responded, noting that the government’s ability to repay its obligations relied on revenue generation, which had declined by November 2023.
The Central Bank made the decision to categorize the US $83 million as a loan to provide breathing room for the incoming administration of President Boakai, who was set to take office. This move was intended to ease the financial burden on the new administration by spreading out the loan over several months.
Senator Konneh and others have highlighted the potential violation of the Constitution in relation to the borrowing of funds by the government. While the Constitution prohibits loans being raised on behalf of the Republic without legislative approval, the Central Bank Act does allow for exceptional circumstances under which the Central Bank can extend credit to the government.
Records indicate that previous administrations, including Senator Konneh’s tenure as Finance Minister, borrowed significant sums from the Central Bank without direct legislative approval. The current outstanding debt owed by the Government of Liberia to the Central Bank, including the US $83 million, exceeds US $570.4 million.
The loan secured by the Weah administration from the Central Bank was obtained during Liberia’s suspension from the IMF program, signaling a complex financial situation that requires further examination. The restructuring of the government’s debt in 2019 aimed to address these challenges and restore financial stability under the IMF program.
Read the original article on The Newdawn Liberia
