June 14, 2017
Her Excellency Ellen Johnson-Sirleaf
President and CIC
Republic of Liberia
Ref: Reclaiming Our Economy by Domestically Empowering Local Companies: The Best Answer to Achieving Vision 2030 and Sustainable Development Goals 2030 – A Call to Withdraw US$59.5 million Pre-Financing Loan Agreement in favor of a foreign company.
Dear President Sirleaf:
In pursuit of our nation’s ultimate interest and the overall welfare of its people, my salutation is all yours, Madam President. Since your ascendancy as Head of State on January 16, 2006, this is my fourth letter I am addressing directly to your office. In the midst of mounting challenges, ranging from unimaginable corruption to acute poverty, silence can never be an option for us as advocates. Our shared demonstration of love and loyalty to this country remains undiluted.
It is with this unquenched and patriotic desire to always seek a NEW LIBERIA through genuine advocacy, we have stood up and standing up even now to confront visible odds that continue to threaten our sovereignty, survivability and commonality as a nation and a people. We dare not economize with prevailing facts as voices of truth. Therefore, we forward this communication to you in good faith.
Madam President, I read a headline story published in The In Profile Daily Newspaper on May 29, 2017 titled “Questionable Contracts”. This publication is implicating Ministry of Public Works into a web of Conflict of Interest with a foreign Chinese-owned company – East International Group. As an advocate, I chose not to anchor my thoughts only on what was published in The In Profile Daily, but to go beyond by digging out some fundamental facts.
Madam President, in my possession, I have a copy of an official communication and a loan agreement from your desk requesting our National Legislature to ratify a Pre-Financing Loan Agreement costing US$59.5 million between GoL and East International Group Incorporated. In your 2-page letter, you said that this loan agreement is meant to pave a 24.5km road from Clay to DC Clark in Bomi County and a 51km neighborhood road in Monrovia and its environs.
I want to applaud your government for its farsightedness to have 30 roads paved even though you have only 6 months in power. Without any intention to oppose our nation’s developmental drive in whatever manner, I have some basic inquiries, which reflect the basis of my thoughts and those evolving concerns I have since harbored about this US$59.5 million pre-financial deal:
- Why go into a loan agreement of US$59.5 with a foreign company that has no proven international record in construction and engineering?
- What is the rationale of preferring East International Group exclusively for such huge DEAL (US$59.5 million for 30 roads) when we have Liberian-owned companies that are even more qualified and capable?
- Who does this US$59.5 million agreement really benefit and what gain does it bring to Liberia? Does it benefit Liberians or Chinese?
- Why wasn’t there any competitive bidding process for such contract in line with proviso of our PPCC Law? Why was East International Group given such a preference, which contravenes Part V Section 46 of our PPCC Law?
- If East International Group defects on its obligation(s) according to this agreement, who pays back this astronomical loan or offset this liability in 7 years? How can we even trust East International when it was recently shut down by LRA for evading taxes even though it was served a 30-day assessment notice (warning) in line with section 1042(d) and section 70 of Liberia Revenue Code and LRA regulations (Ref: http://www.frontpageafricaonline.com/index.php/business/4162-liberia-revenue-authority-shuts-businesses-suspected-of-evading-tax).
Madam President, having carefully read and analyzed this 15-page Pre-Financing Agreement and your communication which seeks to garner legislative endorsement, my questions above have prudently led me to these systematic conclusions judging from available facts and incontestable realities:
1. This US$59.5 million Loan Agreement is a BAD DEAL due to its selective and skeptical nature.
- It unravels high risk of losses for Liberia and puts East International Group in a gainful and profiteering parameter.
- It discourages local dominance of our economy and promotes foreign control, which has a downward impact on growth and development. Additionally, this deal is an unpatriotic attempt to sideline Liberian-owned companies and render them vulnerably inactive and worthless.
- This deal disfigures the true essence of the Liberianization Policy and contradicts Section 45.1 of our PPCC Law, which even highlights Margin of Preference:
“A Procuring Entity may grant a Margin of Preference to Domestic Businesses, or Liberian Businesses, or Solely-Liberian Owned Businesses, as defined under this Act, in accordance with regulations adopted by the Commissioners.”
- This deal, which indicates that East International has exclusive authority to subcontract Liberian-owned companies and engineers at will, gives this foreign company unparalleled leverage and monopoly to control this sector. How can you award a contract of 30 roads to East International alone? This means that Liberian contractors and companies will turn into mere beggars to East International Group before getting contracts. Furthermore, are our engineers and companies only good enough to be subcontracted?
I thought our economy is based on those fundamental principles of a free market system, where competition is permissible? Why then is our government preferring a foreign firm over local Liberian companies? Even community roads too? Whose interest is East International, if I may ask? Madam President, I have reliably learned from an authoritative source that East International Group Incorporated, a former supplier of building materials that came to Liberia in 2010, is the interest of Public Works Minister Gyude Moore.
In pursuit of this egoistic interest shockingly engineered by Minister Moore and his accomplices, East International Group was recently transformed into a construction company. Again I ask, what record does East International have for GoL to comfortably enter into a US$59.5 million agreement with it?
With just 6 months to a very crucial democratic transition, I am aware that our nation will be faced with these glaring complexities of interest-struggle, but for once, can we protect Liberian-owned businesses even during these last moments? I am wondering why is GoL in hurry to pave these 30 roads now with just 6 months to go. This means that the burden to pay this US$59.5 million loan in a period of 7 years will be transferred to the next government.
Madam President, in paragraph 1 and 2 under Economic Renewal in your January 16, 2006 inaugural address, you said “The task of reconstructing our devastated economy is awesome…..Yet, we have the potential to promote a healthy economy in which Liberians can prosper. We can create an investment climate that gives confidence to Liberians.”
In all of your lines Madam President, Liberians were mentioned first, but I am constrained to ask “Are they first now after almost 12 years”? Are Liberian companies and businesses prioritized now? Are Liberian engineers, farmers and entrepreneurs first under your leadership? Are Liberian-owned companies first over East International Group in this Pre-Financing Agreement? Though I recognize some gains made under your presidency, but most Liberian firms and enterprises remain vulnerable due to foreign dominance in almost every sector of our economy.
Are our engineers only good enough to build plank bridges, lay blocks, transport cement, sell crush rocks, bend steel, draw house plan and serve as casual laborers to foreigners? What are we waiting for to take control of our economy? Taking control would mean prioritizing and empowering local companies over foreign ones like Ghana, Kenya, Ivory Coast, Guinea Senegal, Zimbabwe, Rwanda, Tanzania and other nations are doing.
Madam President, having said all of these, I therefore plea with your conscience in the spirit of openness and patriotism to withdraw such Pre-Financing Loan Agreement, because it is far from seeking Liberia’s ultimate interest. I call on you to preferably re-submit this Pre-Financing Loan Agreement in favor of Liberian-owned companies. This patriotic approach of awarding big contracts is applicable in most countries as a nationalistic standard for protecting citizens’ interests – THE ONES WHO PAY TAXES TO KEEP YOUR GOVERNMENT MOVING AND NOT THOSE WHO WIRE THEIR MONEY TO THEIR COUNTRIES.
May God bless our nation and its people as I remain hopeful.
Martin K. N. Kollie
Youth & Student Activist
Cc: President Ellen Johnson Sirleaf
Vice President Joseph Boakai
Senate Pro Temp Armah Z. Jallah
Chief Justice Francis Korkpor
Liberia Council of Churches
National Muslim Council of Liberia
National Traditional Council
All Political Parties