Liberia looks to Malaysia

MONROVIA: Liberia wants to woo more investments from Malaysia, in particular to develop its natural resource sector. "The key to progress is continued peace. We welcome more direct investment and technology transfer from Malaysia," said Liberian vice president Joseph Boakai.

He was speaking to reporters recently, after the oil palm tree planting ceremony at Sime Darby Bhd's newly-established estate here.

Sime Darby's presence is a milestone considering that less than a decade ago, Liberia was mired in civil war. In the 14 years of devastating civil war that ended in 2003, Liberia's economy was shattered. Many business people, including Sime Darby's predecessor Kumpulan Guthrie Bhd, fled the country as rebels gained control of vast quantities of gold, raw diamond, rubber, and tropical hardwood.

In that 14 years of civil unrest, as many as 80 per cent of Liberians were jobless. The economy then was heavily dependent upon subsistence farming and rubber tapping. In 2005, Liberia's national budget was only US$80 million (RM240 million).

In 2003, peace was achieved in Liberia under the United Nations (UN) peacekeeping force. It set the stage for a democratic election at the end of 2005, resulting in the presidency of Ellen Johnson-Sirleaf, a Harvard-educated banker.

Since Sirleaf's administration came to power in 2006, her team have worked with a growing number of private investors to help turn things around. "In the last five years, our economic growth has exceeded 5 per cent per year. And, most critical, we are at peace for eight consecutive years," Boakai said.

Sime Darby's decision to invest in Liberia dated back to as early as 2006, before its merger with Kumpulan Guthrie Bhd and Golden Hope Bhd in 2007. At that time, Tun Musa Hitam was the chairman of Guthrie. Musa recalled instructing Helmy Othman Basha, who was employed under Kumpulan Guthrie to assess the feasibility of reviving the group's concession in Liberia.

"I remember Helmy wasn't too happy with the instruction as the civil wars had, previously, left us no choice but to withdraw from Liberia. Nevertheless, Helmy pursued the matter and went on to meet with President Sirleaf," Musa said.

After the merger into Sime Darby in 2007, Datuk Henry Sackville Barlow recalled that all directors on the board supported the revival of Guthrie's concession in Liberia. "There was no opposition, everyone was supportive of the proposal. We needed to grow and the revival of the concession proved to be the right thing to do," said Barlow.

Musa added, "we might have failed on the earlier two attempts but this time, we're very optimistic that we will be third time lucky."

Until two years ago, oil palm planting in Liberia is not really known compared to its traditional exports - iron ore, rubber, timber, gold and diamonds. "We're changing for the better. We are restoring our once-vibrant nation. Without international support, we would not have made this progress and would be at much greater risk of returning to war," Boakai said.

In October 2011, Liberia will hold its second democratic presidential election. While Sirleaf's administration has to deal with constant influx of refugees from the neighbouring Ivory Coast, the four million citizens of Liberia are looking forward to a constitutional referendum and scheduled drawdown of what was once the world's largest UN peacekeeping mission.

"If our people seemed impatient, at times, investors must understand where we've come from and where we're heading to," Boakai said. Throughout the streets of the capital city of Monrovia, scores of UN tankers are seen carrying out surveillance and distributing clean drinking water to residents. There were also many restless-looking, unemployed young adults loitering in the streets.

It was, therefore, not surprising that throughout Boakai's visit at Sime Darby's newly set up estate at Grand Cape Mount county, he lauded the community for embracing the operation of the oil palm company. He reiterated peace is a prerequisite to a more prosperous future for all.

Liberia's Agriculture Minister Dr Florence Chenoweth, who was also present, said lasting peace is highly dependent on job creation. "Agriculture is one sector that can solve hunger, create jobs and reduce poverty. We're very happy with Malaysia's long term investment and commitment to our economy."

She welcomed Sime Darby's initiative to help her government empower small farmers to be more involved in mechanised and commercial farming. Under the concession to develop 220,000ha until 2072, Sime Darby is required to work with smallholders to plant up 44,000ha with oil palm under an Outgrowers Scheme.

"Sime Darby has a good track record of large-scale oil palm planting and best practices to achieve high oil productivity and at the same time, mindful of biodiversity conservation," she said.

She highlighted that her government will seek funds from the World Bank to help finance the Outgrowers Scheme for the benefit of Liberians.

Currently, other plantation investors who are also in Liberia are LIBINCO of the London stock exchange-listed Equatorial Palm Oil Group, Golden VerOleum (Liberia) Inc of the Indonesian Sinar Mas Group and Maryland Oil Palm Plantation. Chenoweth expressed hope that plantation investors can collectively transform Liberia into one of the major producers of palm oil in Africa, meeting domestic and export needs .

In wooing foreign direct investment, the Liberian government had established a "one-stop" business centre, lowered construction permit fees, revised the revenue code and aligned import tariffs with ECOWAS common external tariffs. The Economic Community of West African States (ECOWAS) is a regional group of 15 West African countries. Founded in 1975, its mission is to promote economic integration across the region.

In facilitating a more business friendly climate, Chenoweth said her government had waived import duties on Sime Darby's import of high yielding oil palm and rubber seedlings into Liberia. "There's no more tax to bring in the good planting materials," she said.

Such reforms had improved Liberia's ranking in the World Bank's Doing Business 2010 report. To-date, it is the 10th top reformer among African countries.


Call for consulate in Liberia

MALAYSIA needs a consulate in Liberia to protect and promote our trade interests through proactive diplomacy, said Tun Musa Hitam.

As a former deputy prime minister and now, the chairman of Sime Darby Bhd, Musa said Malaysia’s investment in Liberia is set to expand significantly in the coming years.

“It would be relevant and timely for our government representatives to be here.”

According to Ministry of Foreign Affairs’ or Wisma Putra website, the nearest Malaysian consulate to Liberia is in the neighbouring state of Guinea.

“One of Malaysia’s earliest and significant investment here is in forestry. Now, if you just look at Sime Darby, we’re going to pump US$3.1 billion (RM9.3 billion) into Liberia’s economy in the next 15 years. So, it makes sense to have a consulate here,” Musa said.

Malaysia maintains diplomatic relations with countries and international organisations through 105 missions in 83 countries abroad. This includes 66 embassies, 16 high commissions, three permanent representatives to the United Nations and the Association of Southeast Asian Nations, a Malaysian Friendship and Trade Centre as well as 19 consulate offices.

So far, the government has appointed 53 Honorary Consuls to support and assist in the promotion of Malaysia’s interest abroad.

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