Weah outlines macroeconomic successes
In the final year of his first six years term, ahead of elections in October, President George Manneh Weah has described macroeconomic performance in the past five years under his administration as an exception in the entire West Africa, pointing to reduction in inflation rate from 30 percent to under 7 percent in less than two years.
President Weah says this achievement is one of the fastest rates of inflation collapse by any government in recorded economic history.
This disclosure was contained in his sixth and final Annual Message to the sixth sitting of the 54th Legislature in joint session delivered here on Monday, January 30, at the Capitol before a huge crowd of cheering supporters.
The annual report is in fulfillment of Article 58 of the 1986 Constitution of Liberia, which mandates the President of the Republic to give the state of the nation for the year ended, covering total revenue and expenditure for the same period, and to present his legislative agenda for the new fiscal period.
President Weah details that revenue collection for 2022, including grants aggregated to US$740 million or up by US$94 million, compared to US$646 million in 2021.
“A large part of this difference”, the President explains, “is attributable to an increase in domestic revenue mobilization for the calendar year 2022.”
He says revenue performance for the period reported was driven by higher receipts of tax and non-tax revenues, especially taxes on international trade and taxes on income and profits, and that of this amount, domestic taxes were $605 million U.S. dollars, while and external resources received from development partners totaled $135 million U.S. dollars for the same period.
On the expenditure side, he says total cash expenditure for the same period was US$774 million, reporting an excess of expenditure over revenue collected at US$34 million that he attributes to use of treasury instruments.
President Weah: “Of the total cash expenditure, $286.38 million, or 37% percent, was spent on compensation of Government employees; $258.93 million, or 33.45% percent, was spent on goods and services, including grants and subsidies; $89.37 million, or 11.46% percent, was spent on domestic and international debt; and $139.32 million, or18% percent, was spent on public sector investment programs.”
President Weah maintains that the 2022 fiscal year recorded the highest level of domestic revenue performance since the end of the civil conflict in Liberia, which he notes, is clear evidence of economic recovery and macroeconomic stability.
President Weah says his government continues to show strong improvements in mobilizing domestic revenue, which are due to key reforms under the domestic revenue mobilization strategy of the Liberian Revenue Authority, includes expanding the tax base, minimizing revenue loss through raising taxes, building public confidence in the tax system, and implementing greater effectiveness and efficiency in tax administration through innovation and technology.
The President stresses that sustaining domestic revenue performance is the only way his government can guarantee funding of public sector investment programs, to enable address critical infrastructure and social sector challenges, such as roads, electricity, healthcare, and education adding, “It is also the only means to diversify the Liberian economy.”
He urges all national stakeholders to support these reform efforts, including all Liberians and businesses operating within Liberia to pay their taxes fairly and timeously, as is required by law.
President Weah recalls that in 2022, government spent US$139.32 million on public sector investments, and proposes to spend this 2023 fiscal period about US$154 million or 19.8 percent of the current draft national budget that is before the House of Representatives on this sector.
He details that major public expenditure items for 2023 include: US$46 million for transmission of electricity from La Côte d’Ivoire through the CSLG transmission lines, including expansion of electricity distribution across the country; about US$44 million on road infrastructure; US$23 million through the National Road Fund, US$21 million through direct national budget; and about US$36 million on the 2023 presidential and legislative elections, respectively.
“Thus, Mr. Speaker, electricity, roads and elections will consume about $126 million US dollars in 2023, demonstrating my Government’s commitment to put the Liberian peoples’ money where it matters the most”, President Weah adds.
Still on the economy, he recalls during the year under review, government made significant interventions in a number of sectors including Health, Education, Social Development Services, Energy and Environment, respectively with about US$17.3 million spent on vaccines and vaccine-related supplies, including COVID-19 vaccination administration, drugs and medical consumables.
In the education sector, The President reports that his government spent nearly US$38.9 million on tuition-free policy; renovation of public universities; WASSCE and Junior High School examinations; the “Support to Closing Teachers Salary Gaps” project; and support to the Engineering College.
President Weah also notes that for the last fifty (50) years, Liberia’s fiscal year has run from July 1st to June 30th thus, becoming the only country in the ECOWAS sub-region to have this July-June fiscal year, which was inconsistent with the rest of the Member States.
“I am now pleased to announce that, after successful adjustment in 2021, the year 2022 marked the first full implementation of the calendar year budget in our nation’s history, making it now aligned with the rest of the ECOWAS subregion. This has made reporting and regional comparison between Liberia and ECOWAS countries much easier”, he says.
Meanwhile, he says the 2023 National Budget of US$777.9 million has been submitted to the House of Representatives for review, consistent with the total resource forecast for the period, with estimated domestic revenue at US$667.9 million or 85.9 percent, while external resources are projected at US$110 million, representing 14.1percent.
Heading for re-election, the government has increased capital expenditures in the proposed budget for fiscal year 2023 to US$154 million, up from US$143 million in the last fiscal period. Story by Jonathan Browne