LIBERIA: Singapore Loan Warrants A Closer Look – A Plea To President Weah’s Conscience
EACH AND EVERY Liberian dream of a day when all the roads linking the capital Monrovia to the rest of Liberia will be paved. No one enjoys seeing young school-age boys and girls plying their trades in busy traffic hours just to complement what their parents are doing to put food on the table.
EACH AND EVERY Liberian hope and pray that hospitals in Africa’s oldest republic would be equipped with modern or at least the basic necessities so that many of our mothers, fathers, sisters and brothers will stop dying from simple ailments that could be easily handled if only we had the right facilities and qualified nurses and doctors.
EACH AND EVERY Liberian dream of the day when their hopes of a better tomorrow will be realized in their lifetime and not lost in a recurring nightmare of uncertainty eclipsed by bad governance, corruption and greed.
IN AFRICA, hope has been a myth for most who can barely make it. In Liberia in particular, many are hanging on the fringes of hope just to believe that a brighter tomorrow is within striking distance.
OVER THE PAST few weeks, we have been doing our best, as we have done with previous governments, to raise issues of national concern in hopes of making our contribution toward the development of Liberia and encouraging transparency, accountability and at least curbing the cancer of corruption that has been eating away at our nation.
MORE IMPORTANTLY, we are making a strong contribution toward helping President Weah fulfil the desires he professed in his inaugural address when he promised to improve their lives of Liberians through the instrument of pro-poor public governance. “I declare publicly today that transforming the lives of all Liberians is a singular mission and focus of my presidency,” the President said.
DAYS AFTER HIS INAUGURATION, the Weah-CDC-led government began exploring a controversial US$536 million dollar loan process with an Asian conglomerate, led by Eton Finance Private Limited in hopes of providing employment, building infrastructure, strengthening the union, and driving the government’s pro-poor agenda, in the president’s own words, “for the good of our Liberian people.”
WE ALL WANT THIS. After all, Liberia is all we have and each and every Liberian should work toward ensuring that we fulfill these lofty goals.
THE FACT OF THE MATTER is, we must all insist and pray that everything regarding this loan arrangement is done the right way – and with transparency and accountability.
SO FAR, from what our investigation has gathered, there are some serious issues with the financial firm the government has solicited to process this loan arrangement.
INTERESTINGLY, JUST SEVEN MONTHS AFTER declaring its Annual Return in Singapore, on September 5, 2016, that it had been dormant since its formation, Elton Finance Private Limited with the unanimous consent of all the Directors of the Company and all the shareholders of the company filed an “Application for Striking Off” under its Unique Entity Number 200510984K, essentially delisting and/or dissolving itself as a company. The reason given by the company in its dissolving is “company has not commenced trading since the date of incorporation”. The company claimed further in its “Application for Strike Off” that the company a) has no outstanding tax liabilities owing to the Inland Revenue Authority of Singapore (IRAS) and is not indebted to any other Government Agency; b) is not involved in legal proceeding within or outside Singapore and c) has no existing assets and liabilities as at the date of application and no contingent assets and liabilities that may arise in the future.
ADDITIONALLY, on May 7, 2018, this year several weeks before the Liberia Loan arrangement, Eton Finance Private Limited re-applied to the Accounting and Corporate Regulatory Authority (ACRA) to be reinstated under the same name and Unique Entity Number, 200510984K, and re-naming the same shareholders and directors (Receipt Number ACRA180507174296).
FURTHERMORE, A FrontPageAfrica query of the Singaporean Business Registration Portal (www.bizfile.gov.sg) using the Unique Entity Number obtained from the Eton Finance Private Limited, 200510984K, shows that the company status is still listed as “Struck Off”, raising more questions about their capability to raise the money for the Liberia loan.
WHAT WE ARE most concerned about is the lack of transparency being displayed over this deal by the CDC-led government. The government’s failure to make the Memorandum of Understanding signed with the Asian Conglomerate is raising more questions than answers, particularly, what is Liberia giving up in exchange for this loan.
UNLIKE THE WORLD BANK and the International Monetary Fund(IMF), loans from private financial institutions or conglomerate come with a catch, meaning the want or expect something in return.
THE ARGUMENT ON BOTH SIDES of the aisle has been swirling in debates for years, not just in Liberia but in other third world countries as well. In the case of Liberia, which is already signed onto the IMF program for which they have been managing our transition, the scrutiny on the current quest for a loan from a private firm raises the stakes.
THE IMF HAS already cautioned: “Debt levels have been rising steadily in recent years. While the risk of debt distress remains moderate, borrowing space has clearly been reduced over time. Looking forward, future obligations will need to be undertaken with caution, specifically with respect to securing favorable terms and conditions.”
THE FACT of the matter is that the IMF gets to keep countries like Liberia within a particularly structure within the larger global financial order because it is to their benefit to do so. In most instances those debts are waived or forgiven after a period of time.
THIS IS WHY THE FAILURE of the Weah-led government to make the MOU recently signed for the Singapore loan public is raising concerns amongst Liberia’s partners and stakeholders on whose backs Africa’s oldest republic has been riding enroute to making it’s complicated but rugged transition from war to peace.
THE ETON FIASCO is typical especially when the administration is being reluctant to make the MOU public thereby denying Liberians access to what is in the arrangement and the Sovereign Guarantee that will tie the country in a whopping debt for years.
THE ATTORNEY GENERAL’S Opinion and the Loan Repayment Schedules which should be attached to the documentation required and attached to the MOU and Sovereign Guarantee, is still a mystery to Liberians.
LEGAL EXPERTS SAY, if there are no restrictions placed on the Sovereign Guarantee then Eton can freely convert the SG to say a line of credit or other financial instruments that can then be traded on any number of trading platforms just as the little-known Israeli firm Elenilto did during Ellen Johnson-Sirleaf-led government.
UNDER THE TERMS of most Sovereign Guarantee arrangements, the BORROWER is required under the Agreement to provide a Sovereign Guarantee issued by the Ministry of Finance and Economic Planning, as one of the conditions precedent for the disbursement of the Loan by the LENDER.
WHAT MANY ARE FAILING to understand is that it would be to Eton’s benefit therefore to hang on to the Sovereign Guarantee for as long as possible whether the Legislature ratifies the MOU or not enabling their trading platform to trade on the converted SG instrument for as long as possible.
IN THE ABSENCE of a public and legislative input and debate, we find it troubling that the CDC-led government is proceeding with a 4-G-like speed and a lack of transparency. At a minimum, legal experts say, the administration could have hired one of the top five firms in the world to represent the national interest at a 0.5 to 1 percent retainer and it would have been money well spent.
FOR NOW, Eton Financial, like Elenilto and others, are in the driving seat with a tremendous upper hand provided they are smart – or Liberian authorities get smarter. Eton can afford to hire any top global law firms to represent them to ensure that they delay returning the Sovereign Guarantee to maximize the benefit of trading.
THIS IS WHY we are pleading with President Weah to dig deep and seek international experts’ advice and best practice before proceeding with a loan which has enormous implications and complications for Liberia’s political and economic future.
A HINT TO THE WISE…