Republic of Liberia Economic Update, June 2021 : Finding Fiscal Space
In the years leading to the Coronavirus (COVID-19) outbreak, Liberia’s economic performance was already weak. Since 2014 a series of severe shocks stopped in its track the growth momentum that had been spurred by the Accra Comprehensive Peace Agree...
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| Format: | Report |
| Language: | English |
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World Bank, Washington, DC
2021
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| Online Access: | http://documents.worldbank.org/curated/undefined/357391637337070732/Liberia-Economic-Update-Finding-Fiscal-Space http://hdl.handle.net/10986/36619 |
| Summary: | In the years leading to the
Coronavirus (COVID-19) outbreak, Liberia’s economic
performance was already weak. Since 2014 a series of severe
shocks stopped in its track the growth momentum that had
been spurred by the Accra Comprehensive Peace Agreement of
2003. The economy was buffeted by the devastating Ebola
outbreak, a collapse in iron ore and rubber prices, and the
drawdown of United Nations peacekeeping forces. Monetary and
exchange rate policy remained tight in 2020, with the
Central Bank of Liberia (CBL) exercising caution in view of
uncertainties about the economic impact from Coronavirus
(COVID-19). The cash shortages have made headlines and
prompted the CBL to provide explanations. Fiscal space can
be increased by improving the efficiency of current
expenditure. The government needs first and foremost to
reduce the very high level of current spending and
strengthen domestic revenue mobilization to generate savings
for public investments financing. Liberia should remain
prudent on external borrowing in its quest to meet the large
investment required by the Pro-poor Agenda for Prosperity
and Development (PAPD). Finally, Liberia should improve the
efficiency of its public investment through better planning,
project preparation and management, and better alignment
with PAPD priorities. |
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