LIBERIA'S COMMERCE MINISTER AND TIFA/AGOA UPDATE

UNCLAS SECTION 01 OF 03 MONROVIA 000052 SIPDIS SENSITIVE SIPDIS DEPARTMENT FOR EEB/IFD/OIA AND AF/W DEPARTMENT PLEASE PASS USTR FOR CONNIE HAMILTON PLEASE PASS OPIC FOR JOHN SIMON TREASURY FOR OREN WYCHE-SHAW, RICHARD HALL, AND JOHN RALYEA COMMERCE FOR STEVEN GARDNER AND SALIHA LOUCIF ACCRA FOR KEVIN MCCOWAN DAKAR FOR USDA AND FAA REF A) 07 MONROVIA 1260 REF B) 07 MONROVIA 1201 E.O. 12598: N/A TAGS: ETRD EAID EAGR ECON EAIR OPIC USTR PGOV LI SUBJECT: LIBERIA'S COMMERCE MINISTER AND TIFA/AGOA UPDATE ¶1. (SBU) SUMMARY: The Minister of Commerce is committed to progress under TIFA and is already planning for the AGOA workshop and an AGOA Resource Center. Plans are underway for a standards lab in Monrovia that will permit sanitary and phyto-sanitary tests. The Minister supports establishment of commercial courts. However, Liberia still faces many challenges before exports are likely to reach international standards. END SUMMARY. ¶2. (U) The Ambassador and Econoff met January 11 with Frances Johnson Morris, Minister of Commerce, to review the status of items on the Trade and Investment Framework Agreement (TIFA) work plan and other trade issues. Following is a summary of some of the work plan topics (with numbers referencing the "U.S.-Liberia TIFA Council Meetings Action Items for Follow-Up" list). Interagency AGOA Workshop (items 5 and 14) -------------- ¶3. (SBU) The Ambassador conveyed USTR's proposal of a February 7-8 event, and asked whether the GOL would be able to support and organize a workshop during that period. The Minister said planning for an event the first week of February was well underway but she would confirm the dates with the stakeholders. She provided a draft agenda, proposed participant list, and status report for the workshop. We will encourage to GOL to include members of the legislature in the workshop (per item 14 of the work plan). (Note: The Minister's office confirmed the February 7-8 dates on January ¶14. However, we will be consulting with the Ministry on possible March dates in light of recent information from Washington. End note) ¶4. (SBU) For the AGOA workshop, the GOL is planning an exhibition of Liberian products, including arts and crafts that might be suitable for export under AGOA. Chili peppers that are being grown, on the advice of the West African Trade Hub, have already found a buyer in Europe. March Trade Mission to Ghana (Item 3) -------------- ¶5. (SBU) The Accra Trade Hub reports it has worked with USDA and the Accra-based contractors (selected to assist in the USDA March Trade and Investment Mission (TIM)),for matchmaking opportunities between regional firms and U.S. companies and investors. The Trade Hub made specific matchmaking suggestions to USDA and Brooks Associates; however, no Liberian companies were found to be suitable matches for the U.S. companies on the TIM. ¶6. (U) Embassy Monrovia is still consulting with trade professionals and agricultural experts in Liberia and will forward a few more candidates this week. However, most of the possible candidates would be importers (and not eligible for USG sponsorship) rather than exporters. AGOA Resource Center (Item 10) -------------- ¶7. (SBU) The Minister told us they had received communication on the proposal for an AGOA Resource Center and understood the host should be a private, rather than a government, entity. They are suggesting the Liberian Chamber of Commerce. The Accra Trade Hub reported January 16 that it had scheduled a one-day AGOA Workshop in Liberia to coincide with the opening of the new AGOA Resource Center (ARC) in Monrovia for April, but is now working to move that to March to possibly coincide with the interagency AGOA workshop. Embassy Monrovia requests closer coordination with the WATH/A office as neither State nor USAID officers in Monrovia had received any information on this initiative. Commercial Court system (Item 11) -------------- ¶8. (SBU) The Ambassador asked about interest in establishing a commercial court system for Liberia. The minister, who is a lawyer and was previously the Minister of Justice, said the proposal had been around since the 1990s. She had been a debt court judge and was well aware of the ineffectiveness of the current system and its impact on banks and other companies. She said that in addition to working with Commerce, the proposal should be pursued with the MONROVIA 00000052 002 OF 003 Supreme Court and the Bar Association. (Note: Post welcomes the ongoing contact with the Department Of Commerce's Commercial Law Development Program and looks forward to working with them to move this very important initiative forward. Another promising initiative includes assistance in streamlining the public procurement process. End note.) Standards Lab (Item 2) -------------- ¶9. (SBU) The USG is funding rehabilitation of the Ministry of Public Works, which will include space for a standards lab. UNIDO has committed $250,000 to equipping the lab (and has hired away the Minister's very efficient personal assistant). The GOL already has people undergoing training in Ghana. The lab will allow the GOL to build cases against purveyors of dangerous or counterfeit products (particularly pharmaceuticals) and will be an essential step in attaining the sanitary and phyto-sanitary standards necessary for export of agricultural products and seafood. Boston Seafood Show (Item 6) -------------- ¶10. (SBU) On that note, the Minister confirmed that there are no Liberian firms that are at a level where participation at the Boston Seafood Show next month would be feasible. Having consulted widely with business and government contacts, we support her opinion. However, we will work with the Liberian business community and USAID's Trade Hub to identify participants, either exporters or importers, for next year. -------------- Other outstanding issues -------------- Cargill and cocoa processing (Item 8): -------------- ¶11. (U) We have heard nothing from USDA on this proposal. Harmonizing Customs Data with ECOWAS (Item 9) and transitioning to the ECOWAS Common Tariff (Item 16) -------------- -------------- ¶12. (SBU) According to a previous meeting with the Deputy Minister of Finance for Revenue, the GOL is aiming for a national plan on the ECOWAS common external tariff (CET) by May and would like to start implementation sometime this year. They don't anticipate political obstacles, as there are not many discrepancies between the CET and Liberia's current tariffs. Air travel to Liberia by U.S. airlines (Item 12) -------------- ¶13. (SBU) Since signing an Open Skies agreement with the United States in February 2007, the GOL has been eager to initiate direct air service between the United States and Liberia. However, the security, safety, systems, and immigration shortfalls at the Roberts International Airport (RIA) outside Monrovia remain a formidable challenge for the initiation of non-stop flights to and from the United States. USAID has funded $3 million in airport equipment and the World Bank is providing navigational aid support. Other improvements are planned but it is unlikely these will be sufficient to meet standards required by U. S. aviation authorities and airlines in the near term. Post has requested assistance from the Federal Aviation Authority (FAA),and the Department of Homeland Security (DHS) Transportation Safety Agency (TSA) to assess the status and needs of the RIA and Liberian Civil Aviation Authority (LCAA) with an eye towards preparing Liberia for potential direct air service to the United States. USTDA feasibility study on privatizing port management -------------- -------------- (Item 13) ¶14. (U) A USTDA-funded feasibility study on privatizing port management is no longer required. On December 6, 2007, the GOL signed a Memorandum of Understanding (MOU) with the World Bank, the MONROVIA 00000052 003 OF 003 United States, and the United Nations for a comprehensive reform of the port sector in Liberia. Under the agreement, the GOL has committed itself to a process of holistic reform of the port sector based on a Public Private Partnership concept which embraces a long-term, Build-Operate-Transfer (BOT) arrangement for the Port of Monrovia. The World Bank has pledged $5 million for infrastructure investments and the technical assistance necessary to assess the port sector and prepare for the BOT investment while the United States is contributing up to $5 million for technical assistance to port financial management, as well as the purchase of a tugboat. OPIC support for Liberian businesses (Item 15) -------------- ¶15. The OPIC-funded Liberian Enterprise Development Fund has been licensed, hired staff, and starts disbursing the initial $1.7 million in loans to Liberian SMEs on January 25. (REF A) ¶16. (SBU) COMMENT: There has been progress on the TIFA agenda, but Liberia is several steps away from taking full advantage of AGOA. USG support for building business capacity, improving infrastructure (especially roads, electricity, the airport and seaport),and implementing quality standards will all boost eventual export capacity. We should also support efforts, such as those recommended by the International Finance Corporation and the Center for International Private Enterprise (CIPE),that increase the broader business community's influence and advocacy. ¶17. (SBU) Minister Morris seems more in command of her portfolio than at the time of the October TIFA meetings in Washington, and eager to move forward with trade-enhancing initiatives, but Commerce is not her first love. She is developing her staff, but there is still a disconnect at the ministry between the policy level and the working level. Proposals on improving the investment climate and facilitating trade that are being discussed with donors and among cabinet members have not filtered down to those who will implement the new policies. END COMMENT Booth