First financial report shows healthy improvement in government revenue collection

Liberia’s peacetime government on Wednesday released a financial report of the first three months of its administration revealing a dramatic increase in revenue generation and collection. The report, released by the Ministry of Finance, covers January to March and details revenues and expenditures, said “the quarter showed very strong revenue performance and constrained spending, leading to accumulation of sizeable cash surplus”. It is first such report issued by a Liberian government for more than 20 years in a country recently plagued by violence and instability. Finance ministry authorities said actual revenue generated amounted to US $26.2 million, which is 19 percent higher than projected and more then three times more than the same period last year when the fighting had stopped and a transitional government was in place. “The sharp increase in revenue of 34 percent as compared to the same period in 2005 is the result of initial corrective measures taken by the new government,” the financial report stated. Liberia, rich in diamonds, timber and rubber, is one of the poorest country’s in the world after a turbulent quarter of a century culminating in a brutal 14 year civil war. Peace was thrashed out under international pressure in August 2004 and a transitional government made up of the fighting factions took the helm for a year. Expenditure was also down on last year, said the report, plummeting to “only US $11.3 million compared to US $18.6 million in the last quarter of 2005, which is close to a 40 percent decline.” In the last days of the outgoing government, newspapers were packed with stories of parliamentarians making off with desks, chairs and computers from their government offices. But under Liberia’s first female President Ellen Johnson Sirleaf, unpaid taxes have been collected, the banking systems computerised and revenue leakages plugged, said the report. The good start means projections for the year are likely to be exceeded, said the report, largely through improved tax collection. “We are well positioned to exceed the January-June 2006 projection of US $44.1 million in the months ahead. We expect to go beyond the initial efforts and begin to pursue more fundamental enforcement to broaden the tax base,” the finance ministry said. Liberia currently has a recast national budget of US $44 million which runs from January to June 2006. Liberia’s Finance Minister Antoinette Sayeh had more good news for reports on Wednesday when she announced that the International Monetary Fund had endorsed further cooperation with the Liberian government. “The IMF has agreed for the staff monitoring programme for Liberia for a six months period. This is in the context of the GEMAP [Governance and Economic Management Program]”, she said. Concerns about corruption in government prompted Liberia's international partners and donors in September to draw up an anti-graft plan known as GEMAP. Sirleaf has thrown her support behind GEMAP under which international supervisors will monitor key ministries and lucrative concerns such as the port, airport, customs office and forestry commission as well all state expenditure for the next three years. Sirleaf last month instructed her officials to weed out corruption in their departments. Also on Wednesday, Minister Sayeh announced that three rural custom officials sacked for corruption would soon face prosecution.