VZCZCXRO2685
RR RUEHMA RUEHPA
DE RUEHMV #0618/01 2391734
ZNR UUUUU ZZH
R 271734Z AUG 09
FM AMEMBASSY MONROVIA
TO RUEHC/SECSTATE WASHDC 1262
INFO RUEHZK/ECOWAS COLLECTIVE
RUEATRA/DEPT OF TREASURY WASHDC
RUCPDOC/DEPT OF COMMERCE WASHDC
RUEAWJA/DEPT OF JUSTICE WASH DC 0047
RHEHAAA/NSC WASHDC

UNCLAS SECTION 01 OF 04 MONROVIA 000618 
 
SENSITIVE 
SIPDIS 
 
E.O.12958: N/A 
TAGS: ECON LI OVIP EINV ETRD EAIR EAGR EWWT
 
SUBJECT: CODEL BUTTERFIELD MEETING WITH PRESIDENT SIRLEAF 
 
¶1. (U) August 17, 2009; Monrovia, Liberia. 
 
¶2. (U) PARTICIPANTS: 
 
U.S. 
Charge d'Affaires, a.i.  Brooks Robinson 
Representative G.K. Butterfield (D-NC) 
Representative Sheila Jackson-Lee (D-TX) 
Representative Lacy Clay (D-MO) 
Representative Gwen Moore (D-WI) 
Representative Steven Cohen (D-TN) 
USAID Liberia Mission Director Pamela White 
Steven Koutsis, Acting Deputy Chief of Mission 
Angelle Kwemo, Counsel, Subcommittee on Commerce, Trade and Consumer 
Protection 
Timothy Robinson, subcommittee staffer 
Shannon Weinberg, subcommittee staffer 
Ingrid Gavin Parks, personal staff of Representative Bobby Rush 
(D-IL) 
Nishith Pandya, personal staff of Representative Bobby Rush (D-IL) 
Economic Officer Sarah Gonzales (notetaker) 
 
LIBERIA 
President Ellen Johnson Sirleaf 
Minister of Foreign Affairs Olubanke King-Akerele 
Minister of Agriculture Florence Chenoweth 
Minister of Commerce and Industry Miata Beysolow 
Minister of Lands, Mines and Energy Eugene Shannon 
Minister Without Portfolio Nathaniel Davis 
Chairman of the National Investment Commission Richard Tolbert 
Commissioner of the National Port Authority Matilda Parker 
Acting Minister of Finance Tarnue Mawolo 
 
¶3. (SBU) SUMMARY: The President and her Cabinet emphasized that 
Liberia is "open for business," and expressed gratitude to CODEL 
Butterfield for wanting to encourage more trade and investment 
between Liberia and the United States.  They outlined investment 
opportunities in agriculture, natural resources and the extractive 
industries and discussed efforts to improve the investment climate, 
while cautioning that challenges remain, particularly in terms of 
weak infrastructure and rule of law. CODEL Butterfield expressed 
continued USG support for Liberia. END SUMMARY. 
 
¶4. (SBU) The President thanked CODEL Butterfield for their visit, 
emphasizing that such high-level delegations reinforce her 
conviction that while Liberia faces challenges in terms of 
infrastructure and human capacity, enormous economic opportunity 
does exist.  She introduced the Cabinet ministers present and called 
upon each to brief the delegation on Liberia's economic 
reconstruction, its natural resource wealth, and its efforts to 
reform the investment climate and create a more favorable 
environment for international investors. 
 
Peace and Security 
------------------ 
 
¶5. (SBU) In the absence of the Minister of National Defense, 
President Sirleaf thanked the USG for its leadership in rebuilding 
the Armed Forces of Liberia, and pointed out that it will take two 
years or more for the AFL to become fully operational.  Rebuilding 
the police force, however, remains a challenge, and the 
establishment of a viable police force is key to development. 
 
Agriculture as the Engine of Economic Growth 
--------------------------------------------- 
 
¶6. (SBU) Minister of Agriculture Florence Chenoweth said that 
Liberia is an agrarian culture with fertile soil and a large rural 
population, which is nonetheless plagued with food insecurity as a 
result of the devastating civil war.  The re-emergence of both 
commercial and small-scale agriculture will be the key to sustained 
economic growth, while rebuilding livestock, seed supply and a 
national research capability are also important.  She thanked USAID 
for its significant support to the agriculture sector, and 
encouraged the USG to continue its efforts to train agricultural 
professionals, not only at the senior levels, but also small-scale 
local farmers.  She added her biggest challenge as the new Minister 
of Agriculture would be to reverse urban migration and encourage 
Liberians to return to farming. 
 
Natural Resources and Investment Opportunities 
--------------------------------------------- - 
 
¶7. (SBU) In what he called a "paradox of poverty," Richard Tolbert, 
Chairman of the National Investment Commission, emphasized that 
Liberia enjoys a wealth of natural resources, including rubber, iron 
 
MONROVIA 00000618  002 OF 004 
 
 
ore, gold, diamonds and timber, but for that wealth to translate 
into economic growth and opportunity for all Liberians, the GOL's 
first priority must remain sound resource management and good 
governance.  He thanked the USG for its support through the 
Governance and Economic Management Assistance Program (GEMAP), and 
said that as GEMAP concludes, assistance will migrate to public 
financial management capacity building.  In this way, the GOL will 
continue to improve the investment climate to attract large-scale 
foreign direct investment.  He touted Liberia's revised Investment 
Code and Revenue Code, and said the GOL recognizes that it must 
improve not only the legal architecture but also the country's 
physical infrastructure in order to attract more investment. 
 
¶8. (SBU) Given that the GOL employs only 36,000 people, or roughly 
one percent of the population, Tolbert emphasized that the private 
sector, and not the public sector, must be the engine of pro-poor 
growth.  To that end, the National Investment Commission is working 
specifically to attract investments that will stimulate job 
creation.  Tolbert noted that until all Liberians have a personal 
stake in the country's economy, long-term political stability cannot 
be assured. 
 
¶9. (SBU) Minister of Lands Mines and Energy Eugene Shannon added 
that there were extensive opportunities in mining.  He noted that 
the Mt. Coffee Dam, if renovated could generate 100 MW of 
electricity, but has the capacity to generate 1,000 MW if a larger 
reservoir were built. 
 
¶10. (SBU) Rep. Cohen praised President Sirleaf's efforts to build 
good governance, noting that in 2007 President Sirleaf was honored 
at the National Civil Rights Museum in Memphis, Tennessee, his 
congressional district. 
 
Trade and AGOA 
--------------- 
 
¶11.  (SBU) Minister of Commerce and Industry (MOCI) Miata Beysolow 
said that Liberia is struggling to break free of its import 
dependence and identify possible export markets.  Thanks to the 
African Growth and Opportunity Act, Liberia qualifies for duty-free 
access to U.S. markets for over 7,000 products, but given 
limitations in its productive capacity, it has not been able to take 
advantage of this benefit.  Beysolow said she received guidance on 
how to obtain an apparel visa during her recent trip to the AGOA 
Forum in Nairobi, adding she was hopeful that Liberia could begin 
exporting some traditional fabrics and clothing to small boutiques 
in the United States. 
 
¶12.  (SBU) The MOCI is working on an export development strategy, 
and may target a few promising agricultural products such as cocoa, 
coffee, cassava and chili peppers.  She also hopes to encourage 
value-added exports, such as furniture made from rubber wood, and 
she sees the potential for an American company to build a fruit 
canning plant in Liberia. 
 
¶13. (SBU) Representative Gwen Moore (D-WI) noted that the fishing 
industry could be a major source of exports, and Minister Beysolow 
agreed, adding Namibia recently agreed to provide technical 
assistance to Liberia to help develop an export-oriented fishing 
industry. 
 
Transportation Infrastructure 
----------------------------- 
 
¶14. (SBU) Commissioner of the National Port Authority Matilda Parker 
thanked the CODEL for their visit August 16 to the Freeport of 
Monrovia, adding that the challenges the delegation witnessed at the 
port encapsulate Liberia's infrastructure shortcomings, but also 
demonstrate the opportunities for economic revitalization with the 
help of international private and public sector partners.  As the 
newly-appointed commissioner, she declared her intention to make the 
Freeport the premier port in West Africa, despite its infrastructure 
limitations, by marketing its low tariffs (she said Monrovia had the 
lowest tariffs in Africa) and strategic location. 
 
¶15. (SBU) Representative Sheila Jackson-Lee (D-TX) said she spoke 
unanimously for the delegation in declaring their conviction that a 
revitalized port could be the key to an economic renaissance in 
Liberia.  She said the CODEL would work with Congressional 
colleagues to see if there was a possibility of facilitating 
additional USG funding to reconstruct the marginal wharf. 
 
¶16. (SBU) Representative Jackson-Lee added that the advent of a 
direct flight between Liberia and the United States would provide an 
enormous boost to the Liberian economy.  She said the House 
Subcommittee on Homeland Security, of which she is a member, would 
welcome such a flight, but that the decision rested with the 
 
MONROVIA 00000618  003 OF 004 
 
 
Transportation Security Administration, and would be based on safety 
and security criterion rather than political considerations.  She 
urged the Liberian Civil Aviation Administration to produce a needs 
assessment requested by the TSA, and said that TSA's upcoming 
technical assistance to Liberia should serve as a signal that the 
United States shares Liberia's eagerness to establish a direct 
flight. 
 
Impact of the Global Financial Crisis 
-------------------------------------- 
 
¶17. (SBU) Even though Liberia is only a nascent player in global 
markets, Acting Minister of Finance Tarnue Mawolo emphasized that 
Liberia continues to be hard hit by the global economic slowdown. 
As global food prices hit record levels in mid-2008, the GOL chose 
to remove tariffs on food imports such as rice, which mitigated 
price increases for poor consumers, but also reduced government 
revenues.  Revenue losses continued this year, as global commodity 
prices sank, and customs taxes--which account for 60% of Liberia's 
total revenue--declined.  Further, foreign investors' appetite for 
risk and access to capital continues to diminish, and Liberia is 
struggling to attract potentially lucrative investment in iron ore, 
forestry and rubber. 
 
¶18.  (SBU) Mawolo continued that such revenue losses have a direct 
impact on the GOL's ability to provide services to its citizens. 
Under the Highly Indebted Poor Country Initiative (HIPC), Liberia is 
prohibited from contracting new sovereign debt, which means it 
cannot conduct countercyclical spending to offset these revenue 
losses. Instead, the GOL is forced to cut government expenditures 
from an already-modest budget. 
 
¶19. (SBU) Mawolo said that in three years, Liberia's external debt 
has been reduced from $4.9 billion to $1.7 billion, and all the 
remaining debt to the International Financial Institutions will be 
eliminated when Liberia reaches HIPC Completion Point, probably in 
¶2010.  Most of Liberia's private external debt has been bought at 3 
cents to a dollar, in line with the Paris Club rules, but there were 
two hedge fund (or "Vulture Fund") holdouts.  When Rep. Moore asked 
who the holdouts were and what could be done, President Sirleaf 
suggested she contact Steve Radelet of the Center for Global 
Development, who has been following the issue.  Rep Cohen said that 
he had briefly seen a draft bill on the matter before his departure 
and promised to look at the bill more closely upon his return to 
Washington. 
 
Rule of Law 
------------ 
 
¶20.  (SBU) President Sirleaf concluded by acknowledging that 
governance and the rule of law remain Liberia's biggest constraint 
to growth. She explained that during 14 years of civil war, chronic 
deprivation and poor compensation led to endemic corruption in the 
civil service.  She said the GOL has raised civil service salaries 
from US$ 15 to US$ 80 per month, in order to deter corruption, and 
the General Auditing Commission aims to expose mismanagement and 
malfeasance.  The President also emphasized she wishes to focus 
future reform efforts on the judicial sector, where poorly educated 
jurors remain susceptible to bribery and coercion, ill-trained 
judges must be retrained and "re-oriented," because they cannot be 
fired, and the accused languish in unsuitable prisons for months or 
years while awaiting trial. 
 
¶21. (SBU) President Sirleaf spoke briefly on foreign affairs, saying 
that while debate on domestic issues continues, Liberia cannot 
ignore its place in the world.  Liberia is in a volatile subregion, 
and will "walk with" its Guinean neighbors through the elections. 
She closed on a positive note, emphasizing that Liberia is proud of 
its independent media, and its freedom of speech and association. 
 
¶22. (SBU) Rep Butterfield thanked the President for the 
comprehensive briefing.  Rep. Jackson-Lee added that she hopes to 
return with a business delegation to learn about investment 
possibilities.  She will look into revitalizing the Sister City 
relationship between Houston and Monrovia, and will brief energy 
companies, especially minority energy companies, in Texas about 
opportunities in Liberia.  She noted that Monsanto is in the 
congressional district of another member of the delegation (Rep. 
Clay) and perhaps opportunities in agriculture can be pursued. 
 
¶23. (U) This cable has been cleared by CODEL Butterfield. 
 
 
 
 
 
 
 
MONROVIA 00000618  004 OF 004 
 
 
 
 
 
 
ROBINSON