Country to slash spending 11 pct amid mining slowdown

Pulse Staff 06:58 - 26 January 2016

Liberia's President Ellen Johnson Sirleaf attends a Reuters interview ahead of the World Trade Organization (WTO) Summit in the capital Nairobi December 14, 2015. REUTERS/Noor Khamis

The iron ore producer will see domestic revenues drop by $57 million, or around 12 percent, from an initial projection of $473.8 million for the June to May fiscal year, the president said during a state of the union address.

Liberia expects to slash spending in the current 2015/16 budget by 11 percent due to a slowdown of its mining sector, resulting in a reduction in public sector investment, President Ellen Johnson Sirleaf said on Monday.

The West African nation's economy has been hit in recent years by a slump in global commodity prices as well as a regional Ebola epidemic that killed more than 4,800 Liberians and led many investors to suspend projects.

Liberia had budgeted spending of $622.7 million for this year's budget, but that would be reduced to $552.8 million, Sirleaf said.

"We will be unable to meet the targeted level of public sector investment that is required to meet our obligation to ongoing infrastructure projects and new priorities that are essential for our economic diversification goals," she said.

The International Monetary Fund has estimated GDP growth of just 0.3 percent, well below the African average, last year, though it predicted a gradual pick-up in 2016 largely driven by the gold sector and the strengthening of the post-Ebola rebound.