Month: October 2018

The real purpose and intent of my blog was actually to provoke controversies and discussions of the critical issues that confront our country with the hope that incoming policy actors as well as those interested in the issues would appreciate the challenges and therefore calibrate policy prescriptions and expectations.

It is easy to begin the process by attempting to criticize me because one would say but if you knew of these things why didn’t you solve those problems? That will be a fair criticism but also a fair defense is that within the constraints, we did our best. I am sure no one believed that we would have solved all of the country’s problems within the time frame that we served. This would be an unreasonable expectation!

Additionally, I believe that as you begin to understand the width, the breath, and the depth of the challenges that confront our country, maybe, only maybe, would you then begin to appreciate the efforts that have been made and then recalibrate your expectations.

Before now, it would have been difficult for me to provide any reasonable explanation of the challenges we faced without it coming out as an “excuse.” Now I believe that communicating my experiences and the challenges that confront our country might be able to help the new policy actors.

I want you to consider for a second that even if we didn’t solve all the problems, its possible we gleaned some valuable insights that might be worth something, however little. It is against this backdrop that I want to provide my appreciation of the challenges which confront our country. May I?

And yes, I will take time to compile these into a coherent essay that will tell a story and provide an account, one of many accounts, that policy actors can use to glean some insights or at least my personal perspective.

In these blogposts, I am not making attempts to provide excuses as to why those problems were not solved. In fact, I am arguing that substantial efforts were made but the gravity of the challenges made it appear as though much wasn’t done. By providing, in my understanding, how complex the challenges are, maybe we can begin to appreciate the efforts and try to find way to see how we can help even as private citizens.

FOR EXAMPLE: Let’s look at the situation of pipe-borne water

I am not an expert in this area by any definition but because of my role in the planning function of government, I was able to sit and listen to the technocrats in those areas as they sought financing for various projects.

When you take your time and listen to the technical people then you will really appreciate the width, breath and depth of the challenges we are faced with.

I am sure that we all know that our water infrastructure has two (2) major components: (1) water production and treatment; and (2) transmission and distribution.

What most of us may not know is that the transmission and distribution infrastructure is in a terrible state and requires major investment to restore. Our transmission and distribution infrastructure was built nearly 60 years ago and it was engineered to serve a city of about 500,000 people. At the time, the folks used galvanized pipes to run those lines.

After 60 years and with a population of about 4 times the maximum intended population, you can agree with the assessment that the current infrastructure will require massive re-investment. All of the galvanized pipes have out lived their useful lives and are in need of total replacement. This will cost nothing less than US$150 million to replace those pipes and bring them up to standard and also create the distribution network to serve the nearly 2 million inhabitants of the City of Monrovia.

Now I am just talking about “water.” In fact, just the distribution and transmission aspect of water. I have not ventured into the sewage. I am sure we are aware that the drinking water system and the sewage system don’t use the same infrastructure for transmission.

I haven’t mentioned the production and treatment of water because we have been able to do some work in that area. With support from the African Development Bank, the White Plains Water treatment plant was fully rehabilitated. I believe they are now able to pump approximately 16 million gallons per day but whether that amount of water is making it to the City and in the homes of people is another question. The reason I say it is another question is beacuse the infrastructure to transmit the water is in a terrible state: nearly all the pipes are broken and there are always leaks along the transmission line. The technicians are always only repairing the broken pipes. In fact, finding out where the next leak is, is very difficult. The truth is that the pipes need to be replace.

It is easy to say “but why hasn’t the Government replace them yet?” Well, water, you will agree is not the only challenge the Government has to deal with. There are similar problems of greater magnitude in nearly every area of our economic and social systems.

For a country with a US$ 2 billion GDP that can borrow no more than 5% in a given year but up to 60% of GDP over time, you can appreciate how inadequate the fiscal space is to deal with the number of issues that confront us. Maybe, we need to take time to read the African Infrastructure Country Diagnostic (AICD 2010: A World Bank on Liberia’s Infrastructure deficit  https://ppiaf.org/documents/3149) in order to fully appreciate the extent of the infrastructure deficit we are confronted with and how we need to stabilize it.

The challenges we are confronted with are enormous and its seems that everything is urgent, critical and important. Fixing them all at once is close to impossible. But which one to fix first and which one will come last is the biggest question that no one might ever be able to get right especially if those asking the questions have already decided that you have failed.

In these blogposts, I am not intending to give excuses or argue that there are no solutions for the problems; I am only trying to share light on how complex the problems are and that within the constraints, only so much can be done.

watch out for my next piece…

 

 

 

 

 

I live in a very interesting country called Liberia. And I must admit that I have come to love this country the more I get to understand its people. It is a country in which every single Liberian knows exactly what the root causes of our problems are and knows exactly how to fix them. But astonishingly, they do nothing. No one is prepared to take personal responsibility or action to solve any of the problems even though their diagnosis of the problems clearly demonstrate that personal responsibilities and actions are required.

For example, Liberians complain that we should not be importing pepper from Guinea. We all agree that we have enough rainfall and plenty of fertile land and so it is irrational or inexplicable that we are importing pepper from Guinea. But astonishingly, we are not making pepper farm or garden. Do we expect the Government to make pepper farm? How do we stop importing pepper from Guinea? Should the Government degree or legislate it? Meanwhile, lots of folks are unemployed and complaining on a daily basis of economic hardship when right before them lies enormous economic opportunities.

Another example has to do with products made in Liberia. Liberians complain that our economy is in the hands of foreigners and that we don’t make anything locally but ironically, these same people are not willing to buy products made in Liberia. There is a Liberian company that processes locally grown rice but when employers buy these rice and give them to employees as benefits, the employees complain that they don’t like the rice. They would prefer the imported rice as compared to the locally produced rice. What in God’s name is this? How will we ever empower Liberian owned businesses that are producing locally grown products if we don’t buy from them?

What is confusing is that we know the problems but refuse to do the needful to address them. We rather spend more time complaining and condemning than taking personal actions to solve the problems. This is what it means to be a Liberian. And the more you understand this, the more you get to LOVE the Liberian and Liberia.

This is why I agree with President Weah that we need a national conversation on the mindset of Liberians. He argued that we need a national discourse whereby various opinion leaders can talk to Liberians about the virtues of patience, personal responsibility, personal actions, patriotism, love, respect for one another and a host of other things. I think we should start as soon as possible.

I also agree with my long time friend and founding CDC member, Gertrude Mulbah, who explained to me that a national conversation, using a proven scientific approach that creates a new way of thinking by disrupting the current Liberian “neural pathway” is needed. She argues that the only way to get folks to change their actions is by changing the way they process information and make decisions. And because Liberians have their decision making process hard coded in their existing “neural pathways,” the only way we can change them is by disruption and recreation of a new “neural pathway.” I agree with her.

Liberians will have to learn to match their “belief” and with their “behavior” as Rev. Sam Reeves of the Providence Baptist Church put it so eloquently on Sunday (October 28, 2018). We have to do something to begin to change our national conditions. And I am arguing that those things are largely personal responsibilities and actions. There is nothing stopping anyone from making a pepper farm or garden. I am not talking about a planation; just a farm or even a garden. This can earn you some income. Every child in the street is aware that we are importing pepper from Guinea. How can we stop our foreign exchange from going to Guinea for pepper? This requires no Government action!

But why Liberians are never able to do these things is still perplexing, bemusing, vexing, and discombobulating.

Anyway, that is the Liberia I have to know and Love. We will talk, condemn, and take no personal actions even though the solution is within our collective, individual domain.

Way too many times we have deceived ourselves that government is creating the policy environment for the private sector to thrive. We have only said these in words and they have never been backed by real policy actions.

There has to come a time when we really mean that the “private sector is the engine of growth in Liberia” and truly begin investing in it. The lessons learned from the ebola crisis are sufficient to instruct us that we must invest in the Liberian owned domestic private sector. I remember vividly that the economy nearly collapsed because all the foreign merchants and investors fled the country and reduced their financial exposure. That is what any foreign person would do, right?

During those ‘dark’ days in 2014, my colleagues and I kept awake doing everything so that while our people were dying from the ebola virus disease, the economy would not collapse and increase the death toll. This was indeed a teachable moment for us.

I remember in 2009 when I returned home and started managing Liberia’s first generation Poverty Reduction Strategy (PRS), it was clearly mentioned under the Economic Revitalization Pillar that growth was going to be private sector driven. And again in the Agenda for Transformation, we repeated the same thing in the Economic Transformation Pillar but still nothing.

I am aware that it is not easy to develop the Liberian driven private sector but I am arguing that unless we do that, the economy will continue to be fragile. I know all too well that in a country like Liberia, actions to develop the domestic private sector come with a lot risk and constraints. Those who attempt to develop and empower the Liberian driven private sector will be accused of a number things but I believe that it is risk worth taking. Of course the it might turn out that most of the ventures will not succeed but unless we take risk we will never develop the Liberian owned private sector.

Of course again there is constraint of access to capital for Liberian owned private sector. Most Liberians are financially challenged and considered unbankable. Most of them do not have collateral and without collaterals, banks are not willing to loan them money. And without money, they cannot invest. On the other hand, the foreign merchants (largely Lebanese and Indians) have the capital to invest and so they continue to control the market. In many instances, these merchants take deliberate actions to frustrate Liberian owned businesses simply because they do want Liberians to prosper and take charge of the local economy.

With the recent announcement by the President that under his administration, Liberians will not be bystanders in their own economy, I think the pace is set to change the course of history. I think that Liberians deserve to take charge of the local economy and benefit from its wealth. What is now required is that those charged with the responsibilities of ensuring that the Liberian driven domestic private sector is empowered, begin to do their what is required. I am not saying it is easy; all I am saying is that we begin to make some efforts. During our time, did we try? I know we tried in several respects but these are easy undertakings.

The first thing that I think should happen is that bureaucratic bottlenecks should be removed from the path of Liberian owned businesses and they should be given preferential treatment in every facet of economic life. For example, there is a Bill before the National Legislature for the empowerment of Liberian owned businesses. It has been there for 10 months. The Lebanese and Indians have vowed to kill the Bill and it seems they are winning.

I believe that if we are serious about creating Liberian millions and taking charge of our economy, these deliberate steps should be taken and yes they come with some level of risks. But do we not want to risk anything? I am told that “nothing ventured; nothing gained.”

It is hard time that we begin to take risks and empower our Liberian driven private sector. Some of the businesses that we will invest in will fail. No doubt! But the fear of failure shouldn’t prevent us from trying because unless we try, we will never win. And yes, failure is an option but we begin to invest in the Liberian private sector in deeds and not just words.

At the just ended World Bank/IMF Annual meetings in Bali, Indonesia, we almost had the opportunity to talk about issues relating to global power disequilibrium and trade wars. I deliberately say ‘almost’ because though the Africa Export-Import Bank (AfriExim) organized an evening on this matter, the panelists and the audience missed the opportunity to talk about the economics of the subject matter. I can understand this because usually people are more interested in the politics of these matters than the economics, but I thought that as Africans, we would have used the opportunity to discuss how Africa can benefit from this global power disruption and its attending trade war.

While the truth is that most global actors don’t like what President Trump is doing especially with the escalation of trade wars, I think Africa should look deeper and think how it can strategically position itself to benefit from this economic disruption. It appears to me that the American people will, more than likely, re-elect Trump in 2020 for a second term and so the world will continue to experience these “nationalistic” or “anti-globalist” move and its impact for the next decade or so.

But here is what I see, and I think many African countries including Liberia do have an excellent opportunity to benefit from the current trade war that is taking place between the United States and the People’s Republic of China and even the European Union. For example, in 2017, China imported US$12.3 billion worth of soybeans from the US. With a trade war going on and China having to look for a place where it can buy cheaper and better soybeans, why doesn’t African countries think about filling in that gap? That’s a US$12.3 billion market. This amount nearly sufficient to wipe out the 2017 trade deficit between China and Africa which was about US$20 billion. Or maybe we will spend our valuable time and energy discussing aids which is less than US$80 billion annually. We spend about 80% of our time discussing aids while important market opportunities such as these stare us in the eyes and pass.

Today, China imports US$75 billion worth of goods and services from Africa and exports US$95 billion. So just imagine if Africa could use this as an opportunity to close this trade deficit and create more jobs on the continents. I am using soybeans just as an example but there are several other goods affected by this trade war that countries like Liberia could easily benefit from. What is more interesting is that soybean takes less than 90 days to be ready for harvest. Most African countries have the climate and soil to grow better soybeans but why we are not taking advantage of this is still a puzzle to me.

This is where the AfriExim Bank and the African Development Bank (AfDB) should be rushing to put money so that Africa’s competitiveness can increase rapidly but I guess they are also interested in the political condemnation than the economic exploitation of this global disruption that can clearly benefit the Continent.

I truly wish that Liberia and other poor African countries could take advantage of this golden opportunity and transform their economies and improve the lives of their people.

When the Minister of Finance of the Republic of Liberia returned from the just ended FOCAC meeting in China and announced that he had signed an agreement to explore the possibility of swapping natural resources for development (infrastructure), many pundits decried him and pontificated that either there is nothing called natural resource swap or that it was a bad thing for the country.

Maybe it was the phraseology “natural resource swap” that confused many of us but the fact remains that this is what all poor countries or resource rich countries do in order to accelerate development. When has that become a bad thing? The path we have taken all along has been we sell our natural resources and use the rent to undertake development. In the case of a “natural resource swap” we are intending to use the future proceeds (or the value) from our natural resources to undertake development today. Either way, we are exchanging (swapping) the natural resources for infrastructural development. I am not too sure what is unclear or bad about this?

Another area that others complained about was the mention of the name “China.” What is wrong with pledging or selling natural resources to China in exchange for infrastructural development? Even if we sell the natural resources to European or American companies, they go on to sell to China.  So what is the big deal? Also what is wrong with Chinese companies implementing infrastructural projects? We have all been to China and have seen the massive infrastructural development taking place. China is even overtaking a lot of “developed” countries when it comes to infrastructural development and so there is nothing inherently bad about Chinese companies implementing development projects. It is done all over the world.

I am totally aware that Western powers believe that because they are incapable of competing with China in the area of economic development for poor countries, they try to scare poor countries about dealing with China. When you ask them to do what China is doing for poor countries, they are not willing, able or prepared to do so. They pretend as if they have more concern about poor countries when the fact is that they are more concern about the graudal erosion of their power and influence in poor countries. These Western countries are accusing China of what they (Western powers) did when they were calling the shots on these countries. I believe that all their fears and suspicions are based on what they know they did to poor countries. Well, one would wonder what is the down side of dealing with China? If they screw us like the Western powers did then we are where would have been anyways because the Western powers have never wanted anything better for us. So China is worth the risk (if that is what she turns out to be). Maybe it could be better and then we are winners.

So the Minister’s efforts of engaging in a natural resource swap with China and Chinese companies is in the best interest of the country if it happens. It will mean that we will have better infrastructure that will improve the lives of the ordinary people. Matter of fact, we will still sell those natural resources and if we use the rents wisely, we will build infrastructures in the future to improve the conditions of our people. So if we can build the infrastructure now and pay with the natural resources in the future, is that a bad thing?

And from all available information, the agreements are negotiated with each party seeking it’s best interest. Nothing these agreements do not mean that your natural resources will be auctioned. If your negotiating team auctions them, it means that they would have done so whether or not they were doing it for infrastructure today or the rents tomorrow. In dealing with China, like every other country, we need to smart and be prepared to negotiate hard and tough. Nothing is a given and no one is obligated to seek your interest above theirs. No country in the West will do that. In fact, they screwed us before and that is why we are here. Have we forgotten?

From afar, it is easy to think that Liberia’s problems are easy to solve. It is not until you come up to close to the problems before you begin to see and notice the varied challenges and nuances of the problems that confront the country.

This is not to say that there are no solutions to the problems. This is only intended to highlight that the problems are not as easy as they seem from afar. Let me quickly point out that this essay is not intended to categorize as naïve and ill-informed those who think the problems are easy because I once had similar viewpoint until I came up close to where the “solutions” were being discussed. It was only through experience and close observations that I realized that the problems are multi-faceted, complex, nuanced, and gradated.

I remember vividly in February 2016 at one of the cabinet retreats in which I had a meaningful role to play, I represented to the Cabinet that Liberia can be compared to a “mechanically challenged” vehicle that we are driving to get to a certain destination. I opined further that the conditions attending the challenges are such that: (1) we cannot stop this vehicle to undertake a full repair because too many people are anxious to get to their destination and some sick people on board the vehicle might die; and (2) we don’t have the resources to undertake a full repair of the vehicle.

Because we MUST keep moving, I further informed the Cabinet, it means that we have to make some tough decisions along the way. I was trying to drive home a point that we will not be able to do everything at the same time. We have to find a way to prioritize. I contended that while everything (sector or program) is important, there are some that are more important than others and if we try to fix everything at once, we might not be able to fix anything properly.

I furthered in that presentation by way of an example that what if while we are driving the car (Liberia), the “fan” belt cut and at the same time the “seat” belt cut. What would we do? I insisted that both belts are important but the “fan” belt is more critical to our continued movement than the “seat” belt. By fixing the fan belt properly doesn’t mean that the seat belt is not important but that we must focus on the critical things to keep moving ahead. I then made similar comparison with the “radio” and “breaks” of this mechanically challenged vehicle. I thought we should focus on the “break” and not the “radio”.

Well, I am sure that most people at the retreat got my point of trying to “prioritize the priorities.” During the lunch break, it was the most mentioned topic of the day. While most people understood the analogies, no one felt that they were the “seat” belt or the “radio.” And so we got back to the same situation in which everything was a priority and that we had to spread our resources so thin to the point where the impact is minimum in every facet and we really don’t solve any of the problems in a meaningful way.

To make more picturesque my point, I encouraged the Cabinet to think in terms of having a dollar. Now, lets decide on how we want to spend that dollar. Once we have apportioned that dollar, bearing in mind what is more important to us now and what we might be able to do later, then we can all own the process and deliver. This is easier said than done because everyone believes that their sector is very important, if not the most important. I encouraged colleagues that just because we are not focusing on that sector today doesn’t mean that it is not important. It only means that we don’t have the resources today to do everything at once. Maybe once we deliver on some other sectors, there might be spill over impact in other sectors and yours could benefit. But that argument is a very difficult argument to sell to a cabinet minister who wants to make an impact in his/her sector.

With limited resources and no one prepared to see the value in prioritizing the priorities, it becomes extremely difficult to make significant impact in any one area. So you can see that a little is done here and a little is done there but no major dent is observed in any single area.

The major challenge that I see is that the problems are too many and affect too many people all at the same time but we don’t have the capacity to deal with them all at once. The quintessential question therefore is what do we do first, next and last? Important to bear in mind is that there are varied actors and each actor has a different understanding of what is important and what can wait. For some, health is more important than education. For others, physical security (state security) is more important than others. And still for others, economic security (security of the state) is more important.

Depending on whose sitting at the table, these debates can continue without resolution and meanwhile, we have to keep moving and by moving, we keep digging deep into areas that we might realize we should not have venture into in the first place.

Maybe someone has a magic solution but trust me, the problems are enormous and nuanced. Even in the area of health or education, there are a number of solutions depending on how one understands the problems. Or even in agriculture, which nearly everyone agrees is the ‘lowest hanging’ fruit or our major comparative advantage, the solutions are not easy to find.

And like I tell people, it is easy to talk loosely from the sideline when your comments have no direct or indirect impact in the solution but when you are sitting in the seat whereby your actions or inactions have real life consequences, only then would you know that the problems are not as easy as they seem.

Don’t get me wrong, they can be solved and they will be solved but oversimplification will not help. Development actors need to be given space and time.

 

 

We are here in Bali, Indonesia for the World Bank 2018 Annual Meeting. It is going to be an interesting meeting as I can already see. I usually don’t like to attend these meetings because I can safely predict the outcomes. And that is, it will be all talk and nothing will happen.

The first time I attended one of these meetings was the Working Party Meeting (preparing for Busan 2011) in October or November 2010 held in Tunis. This was before the Arab Spring. Before that meeting, I used to be extremely excited about development partners, especially the multilaterals, and their involvement in the development activities. After leaving Tunis in 2010, I became extremely frustrated and perplexed. I sat in meetings in which the “experts” discussed development issues as if they were new and novel. It was not until one of the participants confessed that those same issues were discussed in the 1970’s by some of the very same actors that were sitting around the table. I wondered: oh my gosh! What is this? Why are they doing this?

Well, because of the job I was doing at that time, I was forced to attend the Busan Partnership for Effective Development Co-Operation in 2011. This was another agonizing experience for me as I knew that no one was sincere about anything that was being discussed and that the gathering was just another fanfare for “development elites” to meet and pretend like they care about poor countries.

As I predicted, we are still where I thought we would be. And I can say, with the outmost certainty that the World Bank Annual Meeting here in Bali, Indonesia will produce nothing. Absolutely nothing!