In Washington: John Donaldson (202) 473-1367
Washington, December 5 –Liberia cleared all overdue debt service payments to the World Bank today, marking the beginning of a new era for the country as it normalizes its relations with the international community. Clearance of arrears to the Bank and other multilateral agencies will make Liberia eligible for full debt relief under the Heavily Indebted Poor Country (HIPC) and Multilateral Debt Relief Initiative (MDRI) programs, thereby contributing to the country’s ability to achieve growth and recovery in the coming years.
Liberia’s overdue obligations to International Bank for Reconstruction and Development (IBRD) amounted to around $344 million and those to the International Development Association (IDA) to around $56 million. The payment of these arrears is part of a comprehensive plan for arrears clearance that includes also the IMF and the African Development Bank. The financing for this plan is being made possible with the support of a wide range of shareholders at the three institutions and marks an important step for Liberia on the road to sustainable economic recovery and engagement with the international community.
In a meeting yesterday of the Bank’s Board, Executive Directors expressed strong support for the tremendous progress made over the last two years in Liberia, especially in the areas of economic governance and accountability, infrastructure rehabilitation and the provision of basic services.
“Liberia has come a long way, following decades of civil strife, and extraordinary efforts have been made in setting the foundations of a democratic state, sustaining an economic recovery, rebuilding fiscal management capacity and increasing transparency and accountability,” said World Bank President Robert B. Zoellick. “The Government and people of Liberia are to be congratulated for this major achievement.”
Although still one of the poorest countries in the world, Liberia has undergone profound changes since the signing of the Accra Comprehensive Peace Agreement of August 2003. Following 15 years of civil war and two years of a transitional government, peaceful, free and fair elections were held in October-November 2005, and Ellen Johnson-Sirleaf was elected president in January 2006. Together with international partners, Liberia has worked to ensure a peaceful society and to revive its once thriving economy.
The International Bank for Reconstruction and Development (IBRD) extends loans with a sovereign guarantee at market based rates of interest. The International Development Association (IDA) provides interest free loans and grants to poor countries.