Trade Barriers Hurting Small Businesses In Liberia

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The Editor,

Will the President and the Lawmakers ever get their act together, to eliminate trade barriers (tariffs and non-tariffs), that are keeping Liberians poor?

Unfortunately, they are too busy taking bribes, stealing (and wasting) our tax dollars, hiring future and ex-felons to run our government, and enforcing trade barriers that benefit a few and hurt many!

Speaking of trade barriers, let’s look at some that are benefiting a few and hurting many (keeping the masses in poverty):

#1) The Liberianization Policy:  The sole purpose of this policy is to increase Liberian participation in the local economy, which is dominated by foreigners. 

But guess what has happened?

For the past 40 years, our Liberianization Policy have forced Liberians to front for foreign businesses,

– Protected and propped up well-connected Liberian businesses from competition in market place, and

– Kept lower priced goods and services from ordinary Liberians!

Judging by such disastrous results, don’t you think it’s time to get rid of our Liberianization Policy?

I do. The best way to way to judge a government policy is not by its stated intention, but by its results!

It’s time to say bye-bye to Liberianization! And embrace free markets!

2) Price Controls:  Despite the disastrous history of price controls, going all the way back to the days of the Roman Empire and ancient Babylon, the economically illiterates in the Liberian government continue to misuse their police power to set prices of other people’s private property (rice, pepper, bitter balls, okra, taxis, buses, etc) to make it affordable.

Affordable, my arse,

But what do you think happens when the economically illiterates in the government set the price of someone else’s goods and services below the market price?

If you say that person will take his goods and services elsewhere to seek better returns, go to the head of the class!  You’re a genius!

In other words, if the Liberian government, through its price control policy, requires that all merchants must sell their rice for US$50 in Liberia, and in Sierra Leone, that same bag of rice is selling for US$150 (market price), most merchants will take or smuggle their goods (rice) to Sierra Leone, where they can get better returns on their sale.

Wouldn’t you do the same thing too?  I would.

But our government continues to keep its Price Controls Policy on their books!

No wonder we keep having rice “shortages!”, transportation “shortages”,  etc in Liberia!

How about eliminating the entire Price Control Division and firing the Minister of Commerce?

I don’t think the masses would miss Alex Addy!

3) Registration Fees imposed on Money Exchangers: In July 2012, the economically illiterates at Central Bank of Liberia (CBL) imposed hefty registration fees (US$1,500) on Money Exchangers to solve the “high exchange rate problem”.

But did the hefty registration fees solve our “high exchange rate problem”?  Please…the rate is still high.

But unintended negative consequences of CBL registration fees (US$1,500) prove disastrous for young entrepreneurs like Melvin Eskill and Bia Williams (small foreign exchange business owners) who can least afford it. 

(Re” CBL Wants Us Out of Business: Money Exchangers Decry Registration Fees” Frontpageafricaonline)

Many poor entrepreneurs (small business owners) can’t find a way to escape poverty, because their way is being blocked by police curfews, licensing restrictions, and other stupid government regulations!

Shouldn’t we help those who help themselves?

4) More Red Tape by the Liberia Revenue Authority (LRA): Recently, the small business killers (LRA) decided to impose additional regulations to crack down on fake invoices and under-valuation on imported commodities. But guess what happened?

These new regulations have proven to be detrimental to small business owners.  They’ve resulted in prolong delays, bribery, and additional taxes!

Look. If you think these LRA people care about helping the little guy earn an honest living and get out of poverty, you’re wrong!

Remember, Robin Hood stole from the rich and give to the poor, but LRA steals from the poor to pay their rent ($600,000 a year) and buy a flat screen tv for Elfreda Tamba’s hairdresser!

5) Ban imposed on Motorbike Taxis: In November 2013, the Liberian National Police, in its infinite wisdom, began enforcing a ban on privately-owned motorbike taxis (phen-phen), the main mode of transportation in Monrovia, to make the streets of Monrovia safer! 

They say it’s all about safety!  

But how many persons did the ban safe?  Nobody knows. But guess what the unintended consequences of the ban were?

Because of the government’s ban, 12,000+ young entrepreneurs lost their ONLY source of income!

They had to shut down their motorbike business! Never underestimate the stupidity of the Liberian National Police!

But here’s the kicker: Youth unemployment is a major threat to the peace and stability of our country, but the gasbags in our government insist on enforcing these economically disastrous regulations that benefit a few and hurt many poor young aspiring entrepreneurs.

Getting rid of trade barriers is the best way to lift Liberians out of poverty!

Martin Scott, Atlanta, Georgia
[email protected]

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