Liberia denies resource deals violated laws

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The Liberian government denied on Friday it had violated its own laws in awarding resource contracts and pledged to implement the recommendations of an independent audit into the deals.

According to a draft of the audit obtained by Reuters, almost $8 billion worth of contracts signed by Liberia since 2009 have violated its laws, casting doubt on President Ellen Johnson-Sirleaf’s anti-graft and good governance efforts.

“We did not violate any laws ... Some contracts awarded were not in the interest of the country and we had to come back to renegotiate,” Information Minister Lewis Brown told a news conference in the capital Monrovia.

“We do recognize that we have capacity problems and we accept that,” Brown said, adding that the audit was aimed at boosting Liberia’s ability to negotiate contracts and avoid corrupt deals.

“The real issue is strengthening capacity,” he said.

Nobel Peace Prize-laureate Sirleaf has said the billions of dollars in foreign investment she has drawn since becoming Africa’s first freely-elected female president in 2006 should help ordinary Liberia to climb out of poverty.

But the audit could prove a bitter pill for Liberia. The accounting firm hired to conduct the audit, Moore Stephens, disclosed widespread irregularities with the deals in its draft report.

Natty B. Davies, chairman of Liberia’s National Investment Commission, said the purpose of the audit was to point out what had happened and recommend possible action.

“We will look into any recommendation that will be made to us,” Davies said at the news conference with the information minister. “That audit was commissioned by us and it is all aimed at enhancing the level of transparency and accountability of this government.”

Liberia, settled in part by freed American slaves, sees itself as a rising African star as it recovers from 14 years of on-off civil war funded by “blood diamonds” that ended in 2003, leaving its economy and infrastructure in ruins.

Major mining contracts signed since 2009 include a $1.5billion deal with Anglo-Australian miner BHP. The draft audit said the deal was among those only “partially compliant” with Liberian law.

It added that none of the tangle of commercial forestry contracts - dozens of smaller-value projects covering a huge area of forest - complied entirely with Liberian law.