Liberia ready to borrow again: finance minister

Mon Jul 19, 2010 12:37pm GMT

By Alphonso Toweh

MONROVIA (Reuters) - Liberia, fresh from having its foreign debt wiped out, is ready to borrow money again but will limit net borrowing to three percent of gross domestic product (GDP), Finance Minister Augustine Ngafuan said in an interview.

Last month the International Monetary Fund (IMF) and the World Bank said they backed a $4.6 billion debt relief programme for the West African country, trying to rebuild its economy after emerging from a 14-year war that ended in 2003.

"We are not going into an environment where we have no rules," Ngafuan told Reuters.

"We have our own rules and we are not going to borrow more than three percent of our GDP," he said.

Liberia, where President Ellen Johnson Sirleaf is seen seeking a second term in polls next year, is in talks with potential lenders about borrowing on concessional terms, he said, declining to give further details.

The government would not exceed the three percent cap without showing special justification to lenders, Ngafuan said.

"From the beginning we want to ensure that we get used to the discipline, so we will be running some deficit, but a deficit we can deal with at a sustainable limit."

Ngafuan reiterated the seven percent GDP growth projection for 2010 that he gave in April. If Liberia achieves that figure, GDP would be around $1 billion.   Continued...

<p>A file photo of a woman sweeping a road along Carey Street in Monrovia November 21, 2005. REUTERS/OLD</p>
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