Monrovia – The January 6, 2020 protest was meant to pressure the government into fixing an already shrinking economy but, in effect, it is draining trade, commerce and casting uncertainties for a country already facing troubles in luring potential investors.
Despite the intervention of the international community prompting the deferment of the earlier planned December 30, 2019 protest organized by the Council of Patriots, basic commercial activities in Monrovia were stalled with most businesses remaining shut on the second to the last day in 2019. Banks and commercial enterprises were circumspect of any violent eventuality, so the best option was to keep their doors bolted. Taxes were lost and some said the government was at the losing end.
On Monday, January 6, Monrovia witnessed an encore to the December 30 drama. This time, the situation garnered more traction as protesters converged on Capitol Hill to vent their discontents against the George Weah-led government. Concerns about the state of the economy were again on top of their agenda – and they insist the government must resuscitate it.
But can the government fix it?
Protest – A bad Omen
Economists have warned that a protracted protests and the fear thereof make investors to think askance of a country’s business sector. In other words, protest is a bad omen for any government – rich or poor country.
Hong Kong, a special administrative region of China, has a GDP of US$372.989 billion – the 35th richest in the world per gross domestic product. That region has been rocked by protest which has seen its economy hurt so badly in the year 2019.
Economists predicted that Hong Kong would enter a “technical recession” by mid-October last year. And it did. There were two negative quarters of negative growth and in the third quarter, the GDP shrank by 3.2% from the previous quarter.
In neighboring Guinea, several weeks of protests saw the capital Conakry struggling for economic stability as businesses were hit hard when violent clashes between protesters and security forces erupted and escalated.
For Liberia, there have been repeated calls to avert any incident of violence as planners of the mass protest maintained that they will remain peaceful. But the detrimental impact of a prolonged protest would hurt the economy, something that is quite unavoidable.
On Monday, business activities in Monrovia were shattered. Stores and vendors were wailed by a ghostly city. Many shoppers and commuters who did not join the protest opted to stay home.
Monrovia is the nuclear of Liberia’s economy and if it sneezes the entire country catches the flu. From the busy Tubman Boulevard, where several commercial banks are headquarters to central Monrovia, where hundreds of shops are located, commercial activities were either at a snail speed or frozen.
Refuting Impact of Protest
The Ministry of Finance and the National Port Authority like every other government ministry and agency tried to release disclaimers that their employees were actively working after news were spread that the protest had shut down government activities.
Malcolm Scott, Director of Public Relations of the NPA, posted Monday morning on Facebook in an attempt to inform his social media followers that the Free Port of Monrovia was in “full swing”.
“Our valued port users/ customers and the rest of the shipping world are being served now and the days ahead. Our outstation ports are also doing great,” Scott wrote.
Also, the Ministry of Finance, which manages the fiscal activities of the government, also managed to refute media reports that it was closed due to the protest, writing on its official Facebook page that employees were “having a normal working day with a significant turn out of the workforce at their respective offices”.
The Ugly of Protest
The government has been struggling to allay the economic concerns generated by the uncertainties of these protests. Howbeit, the ramifications are pretty palpable. Hundreds of thousands of United States dollars have been lost in taxes.
It is unclear how much monies in taxes were lost on December 6, 2019 and before that the June 7, 2019 day-long protest. This is because once businesses don’t operate; they don’t pay taxes to government. The figures are unrevealed. The Liberia Revenue Authority, which collects taxes for the state, has not said anything; however, economists have predicted that a persistent cloud of protest has the tenacity of thwarting minimum economic growth that are spurred out of local trading and commerce. Sources at the Ministry of Finance say the country collects at least a million dollar a day on a very busy commercial day in Liberia. Our source say over 70% of this has been during recent protest.
Protest will cost the loss of hundreds of thousands of dollars in revenue and at the same dampen the prospect of luring potential investors that might be looking Liberia’s way. And with the government already struggling to expand the budget envelope and keep bankrolling civil servants salary, losing taxes will be baneful to economic recovery as well.
It is unclear how much monies in taxes were lost on December 6, 2019 and before that the June 7, 2019 day-long protest. This is because once businesses don’t operate; they don’t pay taxes to government. The figures are unrevealed. The Liberia Revenue Authority, which collects taxes for the state, has not said anything; however, economists have predicted that a persistent cloud of protest has the tenacity of thwarting minimum economic growth that are spurred out of local trading and commerce. Sources at the Ministry of Finance say the country collects at least a million dollar a day on a very busy commercial day in Liberia. Our source say over 70% of this has been during recent protest. Messages generated will be approved by the NRF and will be produced for these audiences.
Protest ‘Makes Things Tight for Us’
Shop owners downtown Monrovia were bewailing the slow pace of business on Monday. Many of them who defied the odds to open their shops were left frustrated. Several street hawkers told reporters Monday that the protest is an “embarrassment” to their livelihood.
“This protest is a complete problem for us the street sellers,” said Patricia Wheon, a hawker on Mechlin Street, who complained that she was also unable to sell on December 30 after news of protest spread.
“When the people host protest it can make things difficult for us; it makes things tight for us the hustlers,” added another street vendor.
One businesswoman told reporters she was exhausted with the news of protest because “we are just worried about our business and how we can make money to take care of our family.”
Another shop owner, who operates a boutique on Carey Street, said she was unable to remove her goods from the Freeport due to the protest and that she won’t be able to “pay taxes to government because she has not been able to make money.”
Amid these reactions from local traders, there are concerns about further protests after police forcibly disbursed the crowd of protesters on Capitol Hill.
As the uncertainty lingers so as the concerns about the economy taking a further downward trend, a situation that would obviously cripple the prospect of improving Liberia’s fiscal space.