Donors step up anti-graft fight with plan to limit government’s powers

The international community has drafted a hard-hitting anti-corruption plan for Liberia that would limit the government’s powers to grant contracts, ring-fence key sources of revenue, place international supervisors in key ministries and bring in judges from abroad.

The Liberia Economic Governance and Action Plan (LEGAP), a copy of which was obtained by IRIN, was drawn up by donors to address the “systemic and endemic corruption” which they believe is handicapping the West African nation’s economic resuscitation after 14 years of civil war.

“Economic and fiscal governance has been insufficient to put Liberia’s economy firmly on a path of recovery, poverty relief and reduction of external debt,” the draft document says.

It is due to be put to Liberia's transitional government and the UN Security Council for endorsement in the coming weeks.

Liberians can often be heard complaining about rampant corruption in the transitional government that was set up under an August 2003 peace deal to shepherd the country to elections due on 11 October.

Residents in the capital Monrovia constantly bemoan the fact that senior government officials drive around in flash four-wheel drive vehicles and find the money to undertake extensive renovations to their homes, while ordinary Liberians are forced to eke out a living in a city where there is still no running water or electricity two years after the war ended.

Much of Liberia's basic infrastructure was destroyed during the conflict, but donors have repeatedly warned that funding for reconstruction will be withheld if politicians continue to squander or pocket resources designed to help the country's estimated three million population.

Now the international community is showing its teeth.

It wants to set up an Economic Governance Steering Committee to supervise revenue collection and public expenditure in Liberia for the next three years.

Three years of tight controls

This body would have the power to veto government economic policies and contract awards and would exercise strict control over all government money.

The LEGAP document calls for the steering committee to include representatives of the United Nations, the European Union, the Economic Community of West African States (ECOWAS), the United States, the International Monetary Fund and the World Bank.

Still no running water and electricity for residents of Monrovia

Domestic representation would come from the Ministry of Finance, the Central Bank of Liberia, the heads of the Contracts and Monopolies Commission and the Governance Reform Commission, as well as a representative from civil society.

“It is anticipated that after three years, Liberia will be able to demonstrate political will and technical ability to manage its own economic affairs in a manner accountable to the Liberian people,” the draft document says.

The proposals were drafted in response to strong concerns expressed by the international bodies at a donor meeting with Liberian government representatives in Copenhagen last month.

The LEGAP proposals have not yet been made public, but diplomats in Monrovia said they would be handed to Gyude Bryant, the chairman of Liberia's transitional government, shortly.

They stressed, however, that the action plan to fight corruption would be a negotiated deal, not an imposed one.

“This is still a draft document. We hope it will go to the transitional government very soon so we can engage them,” Abou Moussa, the acting head of the UN Mission in Liberia (UNMIL), told IRIN in an interview on Wednesday.

“They do acknowledge that we need to move forward and get donors on their side,” he added.

Moussa said diplomats in Monrovia had sent the LEGAP draft to their respective capitals and headquarters for endorsement.

One source close to the donors said several African governments were uneasy about Liberia surrendering so much sovereignty to its financial backers, fearing this might set a precedent that could then be applied to other countries with a bad reputation for corruption.

Moussa said on Wednesday that ECOWAS, Nigeria and Ghana had not yet replied to the LEGAP proposals.

Abou Moussa is currently acting head of UNMIL

Timber and diamonds
Once the details of LEGAP have been agreed to, the plan is due to be sent to the UN Security Council for endorsement.

“We have been struggling to get it to the Council in time for discussions due by the end of the month,” Moussa said. “Even if it doesn’t get through in June, the Department of Peacekeeping Operations is looking into the possibility of a special session sometime in July.”

Liberia’s prime assets are timber and diamonds, but the Security Council banned their export after concluding that former president Charles Taylor was using the foreign exchange earned from these commodities to buy guns and fuel conflict.

Taylor backed insurrections in neighbouring Sierra Leone and Guinea and by the time he was forced out of power in 2003, he was fighting desperately to prevent two Liberian rebel movements from overrunning his last stronghold in the capital Monrovia.

The LEGAP draft hints that the UN ban on diamond sales, imposed in 2001, and the embargo on timber exports, which came into force two years later, could be lifted in return for Liberia accepting tight international oversight of its economy.

”Successful implementation of this LEGAP will contribute to the discussions on the lifting of the existing… sanctions regarding diamonds and timber,” the document says.

In his latest report on Liberia to the Security Council, dated 7 June, UN Secretary-General Kofi Annan, suggested that the government should “invite an internationally recognised forestry management team to temporarily oversee operations in the forestry sector.”

The LEGAP proposals go even further in ring-fencing revenue streams flowing into government coffers.

They suggest that key state enterprises, such as the port of Monrovia, the international airport and the fuel distribution company should be farmed out to international management through competitive tender.

LEGAP also proposes that monies paid to the government should be credited into special escrow accounts to prevent greedy officials from laying their hands on the cash and diverting it into their own pockets.

The draft document also recommends placing international representatives in key economic institutions and state-owned enterprises with the power to sign off and veto deals.

It calls for a review of contracts already signed by the present government and a bar on new concessions being granted until the Economic Governance Steering Committee is satisfied that all the proper conditions for competitive tendering of such awards have been put in place.

This seems to be a response to the discovery of a secret agreement between the interim government and WAMCO, a firm with no mining experience, that gave the London-based company the right to buy and market most of Liberia's diamond production.

Liberia's civil war raged from 1989-2003

The deal was exposed in March and has since been cancelled. A UN panel of experts said the proposed accord would have created “a de facto monopoly over much of Liberia’s diamond-producing regions.”

While reinforcing financial controls, LEGAP also seeks to reform Liberia's justice system so that laws are enforced and offenders are properly punished.

It wants to set up an independent anti-corruption commission and proposes to staff the criminal courts with foreign judges recruited from abroad.

“In the short term, outside judges must be brought in to return the rule of law to Liberia,” the draft says. “Justices, in the first instance, should be provided by a regional partner.”

More UN muscle

The 15,000-strong UN peacekeeping force in Liberia may need to have its mandate strengthened to implement the measures currently outlined in LEGAP – a possibility which Annan has already hinted at.

“The Security Council might … consider whether it wishes to broaden the mandate and increase the resources of UNMIL to enable it to assist the National Transitional Government in providing security in the diamond and timber-producing areas,” he said in his latest report on Liberia.

Diplomats say it is important for LEGAP to be approved before October’s parliamentary and presidential elections.

That would send a clear signal to all candidates that Liberia’s timber, diamonds and other resources were national assets to be used for the common good, not personal cash cows for those holding the reins of power.

“The group will expect any future government to continue to support the LEGAP and will take the level of support into account when formulating assistance levels,” the draft says.

The LEGAP proposals, if they remain in their present form, are likely to be welcomed by international think-tanks following Liberia’s long climb out of civil war.

On Wednesday, the UK-based research group Global Witness called on the international community to get tougher on resource exploitation.

“Not controlling Liberia’s natural resources and not taking action on poor governance in Liberia leaves West Africa at great risk of a return to war,” said Natalie Ashworth from the group’s London headquarters. “The international community must be more robust if it is to safeguard peace and its investment in the region’s future.”

However it remains to be seen what form the final LEGAP will take.

As US ambassador John Blaney put it: "This attempt... done in the spirit of helping Liberia should be seen as a positive development. But the proof of a good cake is always in the eating, so we will have to wait and see what is produced."