WASHINGTON, DC – In late 2003, Liberia began to emerge from two decades of brutal military government and civil war that had left the country with no functioning public services, spawned large-scale theft of timber and diamonds, and generated massive debts to foreign creditors. Now, under the leadership of President Ellen Johnson Sirleaf, Liberia has reached a historic milestone: a comprehensive debt-reduction package that writes off more than 90% of its foreign debt and opens up new opportunities to rebuild the country.
Liberia joins 22 other sub-Saharan countries that have received comprehensive debt relief over the past decade. It is also one of a handful of countries that have achieved significant results in recovering from the deep damage of prolonged conflict by rebuilding government and establishing the rule of law.
I began that quest for comprehensive debt relief in early 2006 while serving as Liberia’s Finance Minister, representing Johnson Sirleaf’s new government. As Director of the International Monetary Fund’s African Department, I witnessed the historic “completion point” of the process in Washington, DC, alongside my colleagues from the World Bank.
Liberia’s progress has significance well beyond its immediate borders and those of its neighbors in West Africa. Its story shows that, given strong national leadership, an internationally coordinated combination of military, humanitarian, technical, and financial assistance can help to turn around failed states, enabling them to rejoin the international financial and political communities and benefit fully from linkages to the global economy.