Identifier
Created
Classification
Origin
08MONROVIA63
2008-01-23 14:39:00
UNCLASSIFIED//FOR OFFICIAL USE ONLY
Embassy Monrovia
Cable title:  

LIBERIA: MEETING WITH FINANCE MINISTER ON USG ASSISTANCE,

Tags:  EFIN EAID ASEC PGOV KCRM EWWT LI 
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VZCZCXRO9044
OO RUEHMA RUEHPA
DE RUEHMV #0063/01 0231439
ZNR UUUUU ZZH
O 231439Z JAN 08
FM AMEMBASSY MONROVIA
TO RUEHC/SECSTATE WASHDC IMMEDIATE 9670
RUEATRS/DEPT OF TREASURY WASH DC
RHMCSUU/FBI WASHINGTON DC
INFO RUEHZK/ECOWAS COLLECTIVE
UNCLAS SECTION 01 OF 03 MONROVIA 000063 

SIPDIS

SENSITIVE
SIPDIS

DEPARTMENT FOR AF/W, DS, AND EEB/OMA
TREASURY FOR RICHARD HALL AND OREN WHYCHE-SHAW
FREETOWN ALSO FOR LEGATT

E.O. 12598: N/A
TAGS: EFIN EAID ASEC PGOV KCRM EWWT LI
SUBJECT: LIBERIA: MEETING WITH FINANCE MINISTER ON USG ASSISTANCE,
PORT, BUDGET AND STOLEN CARS

REF: 07 Monrovia 1377 (IRS request)
07 Monrovia 1007 (Port)
07 State 152255 (BIT)

UNCLAS SECTION 01 OF 03 MONROVIA 000063

SIPDIS

SENSITIVE
SIPDIS

DEPARTMENT FOR AF/W, DS, AND EEB/OMA
TREASURY FOR RICHARD HALL AND OREN WHYCHE-SHAW
FREETOWN ALSO FOR LEGATT

E.O. 12598: N/A
TAGS: EFIN EAID ASEC PGOV KCRM EWWT LI
SUBJECT: LIBERIA: MEETING WITH FINANCE MINISTER ON USG ASSISTANCE,
PORT, BUDGET AND STOLEN CARS

REF: 07 Monrovia 1377 (IRS request)
07 Monrovia 1007 (Port)
07 State 152255 (BIT)


1. (SBU) SUMMARY: Liberian Finance Minister Antoinette Sayeh is
grateful for USG, especially Treasury, support for the GOL's
multilateral debt-relief efforts. The Ministry of Finance (MOF)
will assess the best use of USG assistance in the debt management
strategy, and welcomes the rapid response to the Minister's request
for assistance in tax administration reform (ref A and septel).
They are eager for the arrival of the expert to advise on
incorporating the Bureau of the Budget into the Finance Ministry.
She shares the Ambassador's concerns about port management. Both
customs outsourcing and a path towards a Build-Operate-Transfer
(BOT) contract for the port are proceeding. The Ministry
appreciates our assistance in identifying cars that were stolen in
the United States, and would be happy to work with law enforcement
or the insurance industry in resolving those cases. (See action
request paragraph 6.) END SUMMARY


2. (SBU) The Ambassador, accompanied by Econoff, met January 17 with
Minister of Finance Sayeh to discuss issues facing the ministry in
the coming year. The Minister was joined by Deputy Minister for
Expenditure Roderick Smith and Deputy Minister for Revenue Elfrieda
Tamba. Sam Russ, Director of Domestic Debt Management and Dan
Honig, the Minister's American advisor under the Scott Fellows
program, also attended.

State of Play on Debt
--------------

3. (SBU) After initial discussion of the best use of USG assistance
in debt management and tax administration (septel),the Minister
asked that we convey her thanks to Treasury for "seeing them
through" the multilateral debt relief process thus far. She said
the IMF Board agreed on January 14 to count Liberia's track record
under the Staff Monitored Program towards the HIPC (Highly Indebted
Poor Country) Decision Point, and preliminary HIPC documents were

presented to the Board. She added that the Decision Point document
should be approved by the end of February following board meetings
at the World Bank and the IMF. (Note: During a January 22 meeting
with IMF officials, we were told Liberia will be discussed by the
IMF Board on March 14, rather than the originally-scheduled February

29. End note.)


4. (SBU) The GOL would like to convene the commercial creditors in
mid-February, and expects to go before the Paris Club in March. She
said the GOL is receiving very good legal advice, funded by the
Swiss, on handling its commercial debt. She had met with one of the
largest holders of Liberian commercial debt, and clarified to them
that the Liberian Petroleum Refinery Company (LPRC),like other
state-owned enterprises, is not able to borrow funds.

Stolen Cars: What to do?
--------------

5. (SBU) With the assistance of Embassy Monrovia RSO, Customs has
confirmed that stolen cars are being shipped from the United States
to Liberia. Customs (under the jurisdiction of MOF) is still
determining procedures to handle the stolen vehicles. Deputy
Minister Tamba, in a previous meeting with Econoff, had confirmed
the GOL's willingness to hold stolen vehicles as long as possible
and to cooperate with U.S. law enforcement to resolve cases. We
are aware of interest by the National Insurance Crime Bureau (NICB)
in working with the GOL to recover the stolen cars by sending
representatives to Liberia to assist in the recovery and return of
vehicles as well as potentially provide training on stolen vehicles,
VINs, replating, and other techniques to the Liberian police. The
MOF officials had not been contacted by NICB and were unaware of
that option. They were considering auctioning the stolen vehicles
but noted the GOL is in a vulnerable position. One importer took the
GOL to court for refusing to release a stolen car. The judge found
against the government, on the grounds there was no complainant.


6. (SBU) Action Request: Post seeks DS and FBI guidance in working
with the GOL and NICB to recover or investigate the stolen cars that
are being shipped to Liberia.

Port still murky
--------------

7. (SBU) The Minister, who serves on the Board of Directors for the
National Port Authority (NPA) and chairs the Board's Finance
Committee, and the Ambassador shared their concerns about problems
with NPA management (Ref B). The Board is using the NPA's December
financial results to pass "a strong message to management." There
was great concern that the budget had been "thrown out the window"
towards the end of the year, without any consultation with the

MONROVIA 00000063 002 OF 003


Board. She clarified later that the President had told the NPA
Managing Director that he and his team are expected to be more
effective in implementing the reforms leading up to the proposed
privatization. The Minister confirmed the BOT is still on track for
the next 18 months but will require improved NPA management.


8. (SBU) The Minister said financial information provided to the
Board is improving, due in part to the acquisition of new software,
but she is waiting to see if timely reporting of financial results
continues. The Minister and Ambassador agreed that despite
conflicts between the Managing Director and the GEMAP Controller, it
would be counter-productive to change the GEMAP advisor at this
time. (Note: The USG, through USAID, funds an advisor to the NPA
controller with co-signatory power on financial transactions, as
well as an operations advisor. There have been problems with both
positions in recent months, leading to the departure of the
operations advisor in November. End note.) Instead, both agreed it
would be useful for all parties at the port to review how GEMAP is
supposed to work.


9. (SBU) The two agreed an Internal Controller would be the most
effective use of additional USG/USAID GEMAP funding. A Human
Resources specialist will be necessary, but could be hired for the
short term after NPA management has made progress on budgeting and
right-sizing. They agreed there is a weakness in the recently
signed Memorandum of Understanding (MOU) between the GOL and donors
regarding port privatization, as the MOU creates an all-Liberian
oversight committee that meets without attendance of or coordination
with donors. As an example of the lack of coordination, the
Ambassador pointed out that he has yet to see the UNMIL security
report on the port.

Next steps on the port
--------------

10. (SBU) There will be an ad-hoc meeting with partners on the port,
perhaps in the coming week. The USG will proceed with Terms of
Reference for an Internal Control Manager. Both the Embassy and the
GOL will counsel port management and the GEMAP advisor on improving
working relations. Sayeh reiterated that President Sirleaf has told
the NPA Managing Director to work more effectively with Board and
that the Board has "to be harder on management."

Integrating the Bureau of the Budget
--------------

11. (SBU) Legislation on integrating the Bureau of the Budget into
the Ministry of Finance (a high priority of the IMF and other
donors) has been submitted for approval. The minister said they
would like to expedite the arrival of the short-term consultant who
will help with the legislative process and advise on incorporating
the budget office at MOF. They plan to start implementing the
integration July 1 (the start of the fiscal year) to avoid
interfering with the current budget cycle. (Note: Hiring the
USG-funded expert is in progress and help should arrive soon.)

Customs outsourcing and financial connectivity
-------------- -

12. (SBU) MOF will convene a meeting with partners on Customs
outsourcing before the end of January. They will then be able to
publish the request for Expressions of Interest in February, in time
to meet the July target. Deputy Minister Tamba said MOF has
received approval from the Public Procurement and Concessions
Committee for restrictive bidding to handle the One-Stop-Shop
connectivity that will link customs at the port and airport, as well
the LPRC and Forestry Development Agency to the Central Bank and
MOF. They expect to be able to receive and evaluate the bids within
about one month.

Investment Climate
--------------

13. (SBU) The Ambassador provided the most recent Investment Climate
Statement for Liberia and a copy of the model Bilateral Investment
Treaty (BIT). Both were new to the Minister, although she recalled
her discussion of BITs in Washington (Ref C). We noted BIT
negotiations could be initiated at the GOL's convenience, but we
were providing the draft document as an indication of the types of
issues that will be evaluated during negotiations.

Pre-shipment Inspection: Transparent, but...
--------------

14. (SBU) Tamba confirmed the winner of the pre-shipment inspection
tender was selected January 17. The Minister said she hadn't seen
the papers but immediately added, "It's going to be a nightmare!
People are not going to be happy. There will be challenges." She
stressed, however, that it was a transparent process and they now
have an opportunity to get a better contract with better oversight.

MONROVIA 00000063 003 OF 003


They planned to notify bidders of the result January 18.


15. (SBU) COMMENT: We anticipate, from the minister's reaction,
that the current company won the tender. BIVAC is widely unpopular
with importers and Customs officials, but claims to be the victim of
smear campaigns by competitors. Although the evaluation process was
transparent (an Embassy representative attended the intermediate
stages) BIVAC did bring in additional equipment, such as a scanner,
and enhance its services after the contract was put out for bids.
An American firm that bid did not make the short list, due
apparently to incompetence on the part of its Liberian agent. END
COMMENT.

Booth