Professor Tarpeh Provides Clarification on Pro-Poor Lending Scheme – FrontPageAfrica

Former Minister of Trade and Industry Professor Wilson K. Tarpeh clarified that his transfer from the Department of Trade and Industry by President George Weah was to fill a major administrative void at the Protection Agency (EPA) and has nothing to do with the Pro-Poor Small Business Development Fund.

“At no time have I been involved in any scheme to divert funds intended for the pro-poor loan scheme,” Prof Tarpeh said in response to recent media reports.

Prof Tarpeh said the facts provided by the General Auditing Commission (GAC) report cannot support the conclusion drawn by the newspaper reports – that the program is tainted with corruption, fraud and mismanagement.

According to him, in September 2018, the Government of Liberia (GOL) made a commitment to help small businesses given the constraints faced by small and medium enterprises (SMEs) in accessing affordable financing from banks and other credit institutions.

The decision was also based on the willingness of President George M. Weah to accompany these Liberian companies in this direction.

As a result, in September 2018, the Government of Liberia (GOL) pledged to help these companies.

The initiative, according to the former trade minister, aims to provide financing opportunities to small and medium-sized enterprises (SMEs), microfinance institutions (MFIs) and village savings and loans associations (VLSAs) through the through fiscal stimulus for nationwide quick impact projects across the country with the idea of ​​providing employment, capital and wealth building opportunities to the disadvantaged in society.

This program thus supports the government’s Pro-Poor Agenda for Prosperity and Development (PAPD) which was launched in Ganta, Nimba County on 27 October 2018.

He revealed that a total of 3,000,000 USD (three million US dollars) had been committed as seed capital: 1,000,000 USD (one million US dollars) from the central government and 2,000,000 USD ( two million US dollars) pledged by the Liberia Bank for Development & Investment (LBDI).

Prof. Tarpeh noted that a Memorandum of Understanding (MOU) has been signed between the LBDI (represented by its Chief Executive Officer) and the Government of Liberia (represented by the Minister of Finance and Development Planning (MFDP ) and the Minister of Commerce and Industry – MOCI).

The key element of this MoU was that the entire operation of the lending program (from receipt of a review of loan applications to credit decisions, disbursement and collection) was the responsibility of the responsibility of LBDI.

He further explained that the bank should use its normal standards to assess such loan applications and make appropriate credit decisions or otherwise.

“The decision to leave the whole lending process and operations to LBDI using its own standard was to avoid the fiasco of the Private Sector Development Initiative (PSDI) executed by the previous government,” the official said. Professor Tarpeh.

PSDI was a $4 million initiative to help small businesses in Liberia access affordable resources to grow their businesses.

Instead of leaving the credit decision to the bank, the Ministry of Finance and Development Planning told the bank to whom to lend.

Said Prof. Tarpeh: This government has decided to avoid this disaster platform; and therefore the government transferred all operations of the program to LBDI using its own loan assessment standards for credit decisions.

He pointed out that although the Department of Trade and Industry was never involved in the day-to-day administration of the loan, I took a strong stance as Trade Minister at the time to ensure that that loans are disbursed only to eligible and well-monitored persons. companies only.

He indicated that a steering committee composed of representatives of LBDI, MFDP, MOCI and the Presidential Project Unit, has been set up to receive and examine the periodic reports submitted by LBDI on the activities of the Programme.

“Another key aspect of the MOU was the low interest rate of 4% per annum. In September 2018 or thereabouts, the government disbursed its entire commitment of USD 1,000,000 which was deposited in an account opened for this program at LBDI; and in December of the same year, the Pro-Poor Small Business Development Fund was officially launched by the President of the Republic,” Professor Tarpeh pointed out.

Continuing, Professor Tarpeh noted that “unfortunately LBDI, up to the time of my departure from the Department of Trade and Industry in September 2020, had not paid its pledge of USD 2,000,000. In other words, although a total of $3,000,000 was committed to the project, only the $1,000,000 paid by the GOL was available for the Program, so there was not $3,000,000 available for the project. loan program.

He recalled when the then deputy minister for small business in the department deliberately accused me of disbursing my office loan in cash and having no idea of ​​the operations of the program, I invited the General Audit Commission (GAC) to carry out an appropriate audit of the programme. .

“In December 2020, the GAC released its report which essentially refutes the allegations of wrongdoing and places it at the center of the regime’s planning and execution. The report, through its findings, vindicated me of any wrongdoing objectionable or corrupt, Tarpeh pointed out.

He clarified that at no time had he disbursed a loan or recommended any business entity to receive money under this loan program.

Professor Tarpeh also revealed that the findings regarding the slow disbursement of the loan had been discussed with the bank; and they promised to speed up their assessment processes and credit decisions.

“As for the conclusion concerning the absence of the signature of the Minister of Justice on the memorandum of understanding, it was a trivial and correctable error. In the absence of the Department of Justice, I encouraged and requested the audit of the process by the GAC to help us understand what were the shortcomings of the process in order to make the necessary corrections and adjustments before the continuation of the disbursements . My appeal to the GAC was in the spirit of transparency and accountability,” Professor Tarpeh concluded.

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