Liberia: World Bank Signals Support For the Country's Recovery

Washington, March 10, 2004 - In a strong signal to Liberia and the donor community, following a discussion of the World Bank’s re-engagement strategy for Liberia, the World Bank’s Board of Executive Directors has approved the Bank’s engagement in key activities to assist the country in making a successful transition from decades of violent conflict.

Based on today’s endorsement, the Bank will be able to assist Liberia more actively in this transitional post-conflict period, while a plan is developed to clear its substantial external arrears.  Approximately US$4 million will initially come from the Low-Income Countries Under Stress (LICUS) Trust Fund. Other grants supporting improvements in economic management, infrastructure rehabilitation, and natural resource management are expected to follow in the coming months.

The Bank aims to contribute to a highly coordinated effort between Liberia’s development partners and the National Transitional Government of Liberia to focus reconstruction efforts on an agreed set of priority results which were endorsed at last month’s International Reconstruction Conference in New York.  This focus on early and sustained results builds on efforts to benchmark reconstruction in other post-conflict countries such as Timor Leste and represents a new push by development partners to tighten coordination and increase the impact of aid for reconstruction.

“The Results Focused Transitional Framework (RFTF) for Liberia offers the country’s leaders and the team of  partners a new tool to really get the most important things done.  The World Bank’s first priority will bet to promote economic and social revival in the communities.  We will also help to set up accountable economic management, get going to restore roads, power and water, and improve the governance of forestry,” explained Mats Karlsson, the World Bank’s Country Director for Liberia.

The strategy will be supported by the first grant from the new Low Income Countries Under Stress Implementation (LICUS) Trust Fund.  In addition to supporting community reconstruction and capacity building for economic institutions, the grant will also aim to help maintain the focus and momentum of reconstruction by supporting the operation of an effective Liberian-led mechanism to coordinate RFTF activities and monitor the achievement of results.

“The trust fund will help support Liberia's recovery in the early period following the International Reconstruction Conference held last month in New York, when it is important that funds are available quickly to help consolidate peace and transition efforts", said Sarah Cliffe, coordinator of the Bank’s LICUS initiative. "We are pleased that the trust fund will be able to support close coordination with other donors and our UN partners under the joint results framework.”

No loans have been made since 1984, when Liberia entered a twenty year period of serious troubles. If the arrears clearance is achieved before December 2005, the Bank would be able to fully re-engage in Liberia with International Development Association (IDA) resources. 

In mid January, the World Bank approved the LICUS Trust Fund to strengthen institutions, support early efforts at policy reform and build capacity for social service delivery in the world’s poorest countries. The LICUS countries are characterized by very weak institutions and governance, and constitute the most difficult environments in which to use aid effectively.

            The Bank will shortly establish a presence in Liberia.

The ten priorities areas within the results focused transitional framework for Liberia are:

1.         Security (including UNMIL peacekeepers, armed forces restructuring)

2.          Disarmament, Demobilisation, Rehabilitation and Reintegration of ex-combatants

3.          Refugees, Returnees and Internally Displaced Persons (IDPs)

4.          Governance, Democratic Development and Rule of Law (including public sector capacity, local government, the judiciary, police service, corrections system, development of civil society, human rights, media)

5.          Elections

6.         Basic Services (including health and nutrition, education, community water and sanitation, agriculture, fisheries, community development, social safety nets –groups with specific needs)

7.          Restoration of Productive Capacity and Livelihoods

8.         Infrastructure (power, transport, communications, water and sanitation)

9.          Economic Policy and Development Strategy (financial management and audit, development

strategy, budget and statistical systems, public sector procurement, financial sector, public enterprises, forestry, extractive industries and natural resources management)

10.        Coordinated Implementation of  the Transition Framework

           Cross cutting themes are: gender, HIV /AIDS, environment, human rights, shelter, forestry  and media.

To learn more about the LICUS initiative, go to

http://www1.worldbank.org/operations/licus/