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Liberia sees an historic US$4.6 billion of debt cancelled

The Liberian government has announced that it will see a historic US$4.6 billion of debt cancelled after meeting all its obligations under the Heavily Indebted Poor Countries (HIPC) initiative. In a letter of congratulation to Liberian President Ellen Johnson Sirleaf, whose government is working with AGI, AGI patron Mr Blair declared it a ‘momentous day for Liberia’.

The World Bank and International Monetary Fund yesterday announced that Liberia had reached HIPC ‘completion point’ after only 2 years and three months and would benefit from one of the largest debt write-offs in history, over 90 per cent of the money it owed.

To complete the HIPC process, which enables some of the world’s poorest countries to shed crippling debt burdens, President Johnson Sirleaf’s government was required to carry out major reforms in 12 areas of financial management like public accounts and poverty reduction.

In the letter Mr Blair said: ‘Friends of Liberia everywhere will be full of admiration for how quickly you made the changes and completed the process. I can imagine your sense of personal achievement – the trust you built abroad on behalf of the country has paid off handsomely.’

The news was greeted with jubilation in Liberia yesterday after President Johnson Sirleaf announced it in a radio address to the nation. She hailed it as a great step for Liberia saying:

‘Most of our debt is gone. Like a man who has carried a heavy load many miles, we can cast it off, straighten our backs and lift our eyes to the horizon where a better day is breaking. It’s the day when we stand on our own, unsupported, independent and proud.’

The President said the news marks the beginning of the path back to credit-worthiness for Liberia and will open doors to more foreign direct investment, although she cautioned that the benefits will not come overnight.

The AGI project in Liberia began its work at the beginning of 2010 providing support to the Ministry of State. A team of 5 professionals is helping to design and embed key systems and processes within the Liberian government, and to offer capacity building support, and through this to assist with the delivery of policies and programmes central to Liberia’s reconstruction.