President Boakai, delivering his speech at the inauguration in January 2024

Abubakar Hashim/ Sierra Leone

Liberia’s President Joseph Boakai was prepared for the job right from the campaign trail. He knew the task ahead was a tough one. Huge debts, soaring unemployment, and high inflation, with a decline in domestic revenues and external incomes due to a fall in international prices of iron ore and rubber, Liberia’s two major sources of revenues.

Liberia, is, today, getting to a point where sustaining its debt will be a problem.

External debt is $1.3 billion by 2022 data. Multilateral lenders accounted for two-thirds of Liberia’s debts. The World Bank and the IMF are the two largest creditors. Public total debt stock is $2.21 billion by 2023 data.

Though the country’s debt to GDP ratio is not so high as in Ghana, when it was 98% in 2022, leading to a bail out by the IMF, Liberia’s debt to GDP ratio is 52.7% in 2024, considered to be relatively moderate. It is lower than the World Bank stipulated threshold of 77%.

Debt servicing is a huge challenge for the  Boakai government. In 2017, debt servicing amounted to $ 30.2 million , about 6.1% of recurrent expenditures. By 2023, debt service amounted $ 99.5 Million, about 15.7% of recurrent expenditures in the budget. Boakai aims at reducing this gap, boost revenues to GDP, reduce unemployment rate and keep inflation and exchange rates relatively stabled.

It is a huge task ahead for the Boakai-led administration that is just a month old.

The challenges are enormous, but his grasp of macro economic strategies is unmatched, due to his wealth of experience and his all- round brilliance in the fundamentals of governance