Sunday, October 07, 2007

Germany to Push for Liberia's Debt to be Waived

Germany to push for Liberia's debt to be waived

Sun 7 Oct 2007, 17:37 GMT
By Alphonso Toweh

MONROVIA, Oct 7 (Reuters) - German Chancellor Angela Merkel said on Sunday she would push for Liberia's large foreign debts to be cancelled to try to help Africa's oldest independent republic recover from a devastating 1989-2003 civil war.

Merkel, Germany's first female chancellor, met Liberian President Ellen Johnson-Sirleaf, Africa's first elected female head of state, in the capital Monrovia on the last leg of a four-day trip to the world's poorest continent.

"We have a big interest in Liberia being able to follow its own economic path, and so we will make every effort to waive the debts Liberia still has, both internationally and bilaterally," Merkel told reporters.

The International Monetary Fund said earlier this year the African country's debt -- totalling around $4 billion -- was too high and that it was urgent to gain funding commitments from donor countries to write it off.

Merkel said some creditor nations still needed convincing, within the framework of the IMF, to help Liberia.

"Then we can waive the bilateral debts, and we want to do that so Liberia has a good chance to get going," the German leader said.

Once the world's fifth-largest iron ore exporter and home to the world's largest rubber plantation, Liberia's economy collapsed during more than a decade of on-off conflict.

Average annual income has fallen to just $130 since the war.

Squatters live in the burned-out concrete shells of government buildings in Monrovia, most of the city is without running water, and unemployment is rife, particularly among former child soldiers.

Johnson-Sirleaf, a Harvard-trained economist dubbed the "Iron Lady", has made progress fighting corruption and trying to get the economy back on its feet since being sworn in at the beginning of last year. But foreign debts remain crippling.

"We see this visit as important recognition of efforts being made by all Liberians aimed at moving our country forward," she told reporters after meeting Merkel.

Germany is president of the Group of Eight industrialised countries' this year and Merkel has put tackling poverty in Africa at the top of the grouping's agenda.

She repeated her government's view that all African nations should be invited to an EU-Africa summit in December, indicating a difference of opinion with British Prime Minister Gordon Brown over whether Zimbabwe's Robert Mugabe should be asked to attend.

Critics accuse Mugabe of human rights abuses and of presiding over the collapse of Zimbabwe's economy, which has the world's highest inflation rate of about 6,600 percent and unemployment levels of about 80 percent.

Brown said last month he would boycott the December summit if Mugabe was invited, arguing it would be inappropriate for him to go as he would distract from the agenda.

Asked about inviting Mugabe, Merkel said:

"It is vital to issue an invitation to all African countries. We can criticise where criticism is due. We will certainly issue invitations to each and every one."

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