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Ngafuan unveils Liberia’s $2.58b debt crisis, blames Weah gov’t

by Gibson Gee
March 7, 2025
in News, UPDATE
Reading Time: 4 mins read
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Ngafuan unveils Liberia’s $2.58b debt crisis, blames Weah gov’t

MONROVIA – Amid the harsh economic realities Liberia faces, coupled with the government’s lack of sufficient appropriation of development capital resources, Augustine Ngafuan, Minister of Finance and Development Planning (MFDP), says now is the time to confront the compounding domestic debts to restore credibility and ensure continuous access to funding for smooth public governance.

Ngafuan highlighted the domestic debt challenge when he appeared yesterday morning in Monrovia on the OK Morning Rush (OK FM 99.5).

He disclosed that the country’s domestic debt has exceeded $1 billion, with the total national debt stock—both domestic and external—standing at approximately $2.58 billion.

He stated that Liberia is grappling with a financial credibility crisis, a situation he blamed on the Unity Party-led government inheriting massive debts owed to commercial banks, small businesses, and contractors.

Ngafuan further alleged that the past administration of former President George Weah routinely borrowed money but failed to honor payment obligations, leading to widespread distrust in government financial transactions with its partners at home and abroad.

“One of the realities I faced when I became Minister of Finance was distrust in government. Government had taken loans over time, even from commercial banks, to service activities but routinely failed to pay. Everything was dumped into domestic debt, and this is what we are tackling,” Ngafuan explained. He added that his administration is committed to restoring financial credibility by ensuring the government’s debt payments become predictable.

For many years, multiple companies, including media entities and businesses providing services to the government, have struggled to receive payments. Meanwhile, commercial banks continue to face liquidity issues due to delayed government repayments.

Frustratingly, while the government holds these companies and businesses liable for defaulting on their tax payments, the same government—the largest domestic spender—has not been forthcoming in settling its debts to them.

Ngafuan, who is serving as Minister of Finance for the second time, having previously held the position under former President Ellen Johnson Sirleaf, assured the public that he has the expertise and experience to address Liberia’s perennial financial challenges. His claims align with President Joseph Nyumah Boakai’s decision to appoint him following the resignation of Boima Kamara, who also served as Finance Minister during Sirleaf’s administration and briefly under Boakai.

The Unity Party’s return to power after six years of Coalition for Democratic Change (CDC) leadership under Weah comes with enormous and complex infrastructural, human capital, and institutional development challenges, which have historically placed Liberia among the least developed and poorest countries in the world, despite its vast natural resources.

Continuing his radio discussion, the Finance Minister revealed that commercial banks, which had lost confidence in the government’s ability to repay loans, were surprised when his team began settling interest payments on outstanding debts.

“The commercial banks were surprised when we started paying their interest. They are now seeing a more credible government dealing with the debt situation. What we promised, we do,” he said.

He further stated that vendors and contractors were previously reluctant to provide services to the government due to payment uncertainties. However, as the administration continues to clear debts, businesses are gradually regaining confidence in working with the government.

“At one point, vendors and contractors would run away when they heard ‘government contract’ because they didn’t trust that they would be paid. But that reality is changing,” Ngafuan noted.

Over US$400 Million in Suspicious Debt Claims

Another key issue highlighted by the Minister was that while the government acknowledges its debts to contractors, banks, and businesses, there are also questionable claims requiring thorough investigation. The General Auditing Commission (GAC) has identified over US$400 million in questionable debt claims.

Ngafuan stressed that the government is only obligated to settle legitimate debts.

“Every time someone claims the government owes them, we send it to the GAC for verification. Over time, they have vetted and found more than $400 million in bogus claims,” he stated, adding that the government’s Debt Repayment Strategy involves allocating funds in the annual budget to settle both domestic and external debts while ensuring payments are made only to rightful claimants.

He also referenced an $83 million loan the previous administration took from the Central Bank of Liberia (CBL) in December 2023, which was not initially budgeted for the fiscal year but must now be repaid.

“This government is obligated. If you check the budget, $16 million is allocated for this,” he revealed.

Despite these financial challenges, the Minister expressed optimism that Liberia’s economy is on a path to recovery. He emphasized that his administration remains committed to rebuilding trust and ensuring transparency and credibility in future government financial dealings.

Tags: Augustine NagafuanDebtdomestic debt
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Gibson Gee

Gibson Gee

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