-MFDP Declares Road Map For Gov’t
In its quest to ensure that public expenditure is directed towards public sector investment with greater social and economic impact, the Liberian Government has advanced a six-(6) point recommendations to be adopted for deliberate actions.
Cardinal among the recommendations is a call for government to put a freeze on further employment.
The report also stresses the need to align public expenditure to development priorities in the Pro-Poor Agenda for Prosperity and Development (PAPD),
It further emphasizes the need to allocate a minimum of 20 percent of the budget per annum for PSIPs, specifically, PSIPs that contribute toward social and economic development,
Enhance budget execution and ensure budget credibility and integrity by significantly reducing off-budget expenditure, the report maintains; while equally revealing to ensure that there is coordination between Departments of Budget and Development Planning and Fiscal Affairs to avoid allotment being in excess of available revenue.
Moreover, it spells out the need to ensure that spending entities abide by the fiscal rules.
At the same time, the report discloses that Liberia’s economic growth experienced a period of stagnation between 2014 and 2016 largely due to low commodity pricing and the Ebola Outbreak.
However, during 2017, real GDP growth was at 2.5 percent from negative 1.6 percent in 2016. This growth in real GDP can be attributed to increases in the mining and pinning sector resulting from rise in industrial gold production.
During the period under which the budget was formulated, GDP growth in 2018 and 2019 was projected to increase to 3.9 percent and 5 percent, respectively based on the assumption that there would be expansion in the production of gold, iron ore and commercial palm oil and normalization of investment after a smooth political transition.
Notwithstanding, real GDP growth may decline in 2018 if measures are not taken to address depreciation in the exchange rate between the Liberian dollar and the United States dollar, rising inflation, and the infrastructure challenges.
Prevailing macroeconomic challenges (such as exchange rate depreciation, rising inflation, declines in the market prices of the major export commodities) continue to hinder government’s ability to mobilize domestic revenue to finance the requisite public sector investment.
Despite these economic shocks, Government collected 4 percent in excess of the projected domestic revenue for the reporting period. Moreover, Fiscal measures were enforced to keep public expenditure at a minimum level and ensure efficient allocations of resources.