Finance Minister Stresses an ‘Elevated Private Sector As An Engine Of Growth’ at ECR Group Africa Summit in Brussels

Minister Tweah

Brussels, Belgium - Liberia’s Finance and Development Planning Minister Hon. Samuel D. Tweah, Jr., serving as a panelist on Wednesday, January 9 at the ECR Africa Summit held at the European Parliament in Brussels, has emphasized that an elevated private sector in Africa will serve as an engine of growth and productivity that will be able to address deficiency in the continent’s infrastructure.

He attributed the continent’s deficient infrastructures to the development model that had been practiced in most parts of the continent over the last seventy (70) years that basically de-emphasized the private sector. He however called upon the global community for paradigm shift in favor of infrastructural financing in Africa while also cautioning that it should not be at the expense of the social sector.

Minister Tweah was providing his insightful perspectives as a member of Panel V on the subject “Building Businesses and Infrastructure in Africa”

As a background to the subject of the Panel V’s discussion, the organizers of the ECR Group Africa Summit reflected that the African continent is facing the fastest growth of population in the world. It considered that this rapid population growth provides an enormous challenge with regard to transport, housing, jobs, services and sanitation. The Summit then suggested that in order to enable African nations meet these challenges; there exists a need to provide the right regulatory framework for businesses and infrastructure to grow.

Furthermore, as a basis of Panel V’s discussion, the organizers of the ECR Group Africa Summit disclosed that some of the key initiatives of the last 5 years in the EU have been the EU Trust Fund and the EU External Investment Plan. It further disclosed that the EU External Investment Plan has mobilized 44 billion Euros of investment, to make the important link between private enterprise and public money for building long-term sustainable economic growth.

Hence, the essence of Panel V’s discussion under the theme “ Building Businesses and Infrastructure in Africa” was to look at how the EU, its Member States and African nations can work together to put the right framework in place.

Making his presentation at the summit, Minister Tweah lamented that over the past twenty five years, Africa has not made much progress in building and improving its infrastructure especially with roads and electricity infrastructure. The Liberian Finance Boss emphasized that businesses in Liberia and other parts of Africa are being constrained by the lack of infrastructure. But he added that the biggest progress in Africa’s infrastructure has been with telecommunications especially in the area of mobile telecommunications which provides Africa enormous opportunity to leapfrog.

Speaking further as a panelist, Minister Tweah identified significant historical spending biases towards infrastructure quoting Official Development Assistance statistics. He identified that in the 1970s, annual spending on economic infrastructure on the continent amounted to about US$2.5bn which has now increased to about US$20bn, while the 1970s annual spending of US$10bn on the social sector has in recent years increased to about US$45bn annually. However, Minister Tweah clarified that the disproportionate spending in health and education under the social sector was for good reasons.

Regarding the fundamental question in addressing Africa’s large infrastructure gap, the Liberian Finance Minister asserted that depending on who you talk to, the amount needed will vary. He said, the World Bank’s statistics suggests that Africa needs about US$95bn investment in infrastructure annually, while the African Development Bank suggests a spending of about US$150bn to US$170bn annually to address the infrastructure gap.

Placing the focus on Liberia's experience and challenges in terms of economic growth, inward investment as well as regulatory framework for businesses and infrastructure, the Fiscal House Boss expressed the thought that there is a critical need for international development partners to scale up financing to African nations, including Liberia, in order to make it more impactful especially in addressing the continent’s infrastructure needs.

He added that the Liberian government is formulating the appropriate framework to attract increased financing support from the European Union and other multilateral development institutions in order to adequately support the development of the country’s roads and electricity infrastructures necessary to relaxing the growth constraints thereby enabling the attraction of major investors from Europe, Africa and other parts of the world to provide jobs for its people.

The Finance Minister opined that there is no poverty reduction on a sustainable basis unless the African private sector becomes competitive.

He said that considering Liberia’s huge debt obligations (something he put around a billion USD), the government is keen about attracting inflows through public-private-partnership arrangements.

The George Washington University-trained Economist, Finance and Development Planning Minister Samuel D. Tweah, Jr. also told the Summit that the government of Liberia was making strong efforts to improve the country’s business climate. He said the Business Climate Working Group established by President Weah was working assiduously in identifying and removing the hindrances affecting the country’s business environment.

He specifically disclosed that the Business Climate Working Group is working towards cutting the steps in setting up businesses in the country, the establishment of online platform, and looking at contract enforcement issues especially in boosting investors’ confidence in the justice system in seeking redress.

Additionally, Minister Tweah assured the Summit at the European Parliament about other efforts underway to robustly improve the country’s business environment in the next six months. He encouraged investors to take advantage of the massive business opportunities in the country.

Other member of the panel included: Former Minister Anusha Rahman Ahmad Khan of Federal Minister for Information Technology and Telecommunications, Pakistan; Doctor Anna Masłon-Oracz, Economist at Warsaw School of Economics and Arne Gericke, Member of the European Parliament.