Wednesday, 25th June 2008
Monrovia, Liberia - The Government of Liberia wishes to provide the public with the following update on its ongoing response to the global commodity price increases.
RICE
Short Term
As a result of negotiations with the governments of China, India, Japan and the United States, there will be no shortage of rice on the local market. This meets the Governments policy on availability.
The current official retail price per 100lb. bag of rice is US$31.00. As a result of oil and freight increases, there is likely to be an increase to around US$35.00 when new negotiated stocks reach the market. This compares with current average prices of US$45.00-US$50.00 and above in neighboring countries. Despite this increase, the Government policy on affordability is still partly met.
MEDIUM TO LONG TERM
There is a general consensus that the real solution to sustainable availability and affordability of rice is an increase in domestic production.
Toward this end, the Government has:
Concluded, with Legislative ratification, a US$30 million Concession Agreement for mechanized large scale rice production on 15,000 hectares, primarily in Lofa and Nimba counties;
Negotiated a US$2.5 million Concession Agreement for mechanized large scale rice production on 5,000 acres in Grand Cape Mount County;
Reached an understanding with the Chinese government for mechanized rice production on 300 acres in Bong County;
Concluded negotiations with the World Bank for US$10 million to support rice and other food production through a cash-for-work program, continue action of the World Food Program (WFP) lunch feeding in schools, seed multiplication and provision of post harvest facilities;
Provided US$250,000 to purchase and distribute rice to farmers for this planting season and allocated US$500,000 to buy from farmers their surplus of paddy rice for milling after upcoming harvest;
and Increased by 70 percent the budgetary allocation to the Ministry of Agriculture to facilitate, inter alia, an expansion in their support for food production.
PETROLEUM
Given the 25% plus increase in world market price, and to avoid hoarding and shortage that would lead to artificially high prices, the official price of petroleum products has increased by an average of 60 cents per gallon.
CEMENT
Despite a request for increase, it has been decided that the current official price of US$9.05-$10.50 will remain unchanged until further study and the dialogue with manufacturers/potential importers have taken place.
GOVERNMENT'S RESPONSE
In order to mitigate the effect of these price changes, the following measures have been or will be taken in the next few days:
A continuation of the suspension of the US$2-$2.20 import tariff on a bag of rice;
A continuation of the suspension of import tariff on agriculture and road building equipment and agricultural materials and supplies;
A removal of taxation on all employees (GOL and Non-GOL) on income of US$75.00 or less;
A reduction from 1.5% to 1.2% in BIVAC fees;
The cost of clearing a 20-foot container will be reduced by US$396 and US$498 for a 40-foot container effective July 1, 2008. The National Port Authority (NPA) will post the details of the fees that have been eliminated;
All illegal and improper charges and fees will be abolished at the ports, details to be posted by the National Port Authority;
The settlement of 2 months civil servants arrears to be paid by July 15, 2008;
No increase in transport fare through December 2008 by the MTA, with Government subsidizing increase petroleum costs. This measure will be reviewed again in December 2008;
The provision of additional buses to MTA to enable them to increase the transport routes;
And The Administration is directing all Government entities to review their respective fee structures and look for ways to reduce the cost of goods and services to citizens.
The Government will continue to monitor the overall situation and institute appropriate additional measures as required. Government also instructed security to closely monitor all cross border trade.