U.S. Experts to Help Manage Ailing Liberian Economy

In an unusual move, the United States is sending 17 financial experts to Liberia with sweeping authority to manage that country’s debt-ridden economy, State Department officials said Wednesday.

Under the plan, which the Liberian government agreed to as the price of U.S. economic assistance, the American experts will form what one official characterized as a shadow economic Cabinet.

The program follows substantial criticism of the way U.S. aid has been handled by the West African country’s government, which has had close ties to the United States since the early 19th Century, when it was established by freed slaves.

Phyllis Oakley, the State Department’s deputy spokesman, announced the agreement to set up a “joint financial management program,” in which the experts hired by the United States “will be working with their senior Liberian counterparts in key financial ministries and other government institutions.”

To Co-Sign Decisions

Asked if decisions would have to be “co-signed” by the Americans, she said, “It is my understanding that they do.’

She said Liberian President Samuel K. Doe “has the final say on all these matters,” but other State Department officials, speaking on condition they not be identified, described the program as a takeover of Liberia’s economic management.

Under the agreement, reached last month between Doe and M. Peter McPherson, the administrator of the U.S. Agency for International Development, the U.S. managers will be placed at the highest levels of departments controlling exports, imports, computer operations, procurement, tax collection, customs, budget and foreign exchange.

A U.S. manager also will be placed in the central bank.

Asked what operations the Americans would have to co-authorize, one official said, “Just about everything.”

$434 Million in Aid

U.S. leverage to gain such power stems from the importance of U.S. aid, which totaled $434 million between 1980 and 1986 and made the country of 2 million people the highest U.S. assistance recipient, per capita, in sub-Saharan Africa.

Further aid--including $10.2 million that would have been sent last year--has been frozen because Liberia is more than one year behind in some loan repayments to the United States.

“The purpose of this program is to help Liberia get back on its feet and to make sure that it is following economically sound policies to get there,” an official said.

Liberia also has agreed to work out reform measures with the International Monetary Fund, one of the international economic institutions that suspended its operations in Liberia because the country has failed to pay its debts.

In other economic moves, Liberia has agreed to stop borrowing on its offshore oil reserves and halt what the agreement with the United States calls “extra-budgetary expenses.”

Took Over in 1980 Coup

“U.S. economic and food assistance to Liberia has faced a high risk of diversion and or misuse since 1980,” according to a Feb. 13 report by the General Accounting Office, the investigative arm of Congress. The year 1980 was the year Doe, a Liberian army master sergeant, took over in a coup in which 400 people were killed.

Concern about the human rights situation in Liberia has also been raised, notably by private U.S. groups that have questioned the legitimacy of the Doe government.

Doe’s party asserted that it won 51% of the vote in an October, 1985, election, but the victory margin was “widely believed to have been fabricated,” the State Department said in a Feb. 19 human rights report.

The report added, however, that the human rights situation in the country appeared to have improved in 1986. Secretary of State George P. Shultz said during a visit to the country on Jan. 14 that he perceived “genuine progress” on rights issues.