Development expert Steve Radelet wrote an important piece on the state of debt relief in Liberia on Nicholas Kristof’s NYT blog earlier this month.
Radelet writes:
“Liberia is beginning to rebound from its devastating civil war and the monstrous incompetence of [the country's former Presidents] Samuel Doe and Charles Taylor that nearly destroyed the country.
Liberia is at peace, the economy is growing, democracy is taking root, kids are going back to school and families are being united…Liberia’s “control of corruption” index, as measured by the World Bank, registered the second-largest improvement of any country in the world this year.”
And then he talks about their debt situation:
“Most [of the debt] was borrowed by Samuel Doe in the early 1980s, and has not been paid since 1984. With penalty interest, Liberians today are stuck with the bill: $4.5 billion, equivalent to a massive 3,000 percent of exports, the highest ratio in the world.
The major creditors all have pledged to forgive Liberia’s debts, but the process is stuck at the IMF, where the Board has been debating for a full year how to share the costs of the write-off. A solution seems at hand, but it isn’t done yet, and meanwhile Liberia must wait (if you feel so moved, write this week to the Managing Director of the IMF and ask for fast action to resolve Liberia’s debt crisis).”
You can read the full piece here.
(Note that Liberia’s turn around happened after they elected President Ellen Johnson Sirleaf, the first woman elected head of state in Africa. Radelet closes by saying: “I hate to be a sexist, but maybe we ought to put more women in charge in tough places around the world.”)
