President Ellen Johnson Sirleaf has welcomed comments and recommendations by two rights groups, contained in an in-depth analysis of a recently concluded Mineral Concession Agreement between the Government of Liberia and the China Union Mining Company. The President described as refreshing the observations and recommendations by the two groups, noting that terms of the agreement are a manifestation of Government’s determination to ensure that Liberia reaps the maximum benefits from its natural resources.

President Johnson Sirleaf described as constructive the acknowledgment by Global

Witness and Green Advocates standards being set by the Government of Liberia to highlight in concession agreements, measures which will safeguard the interest of the country and benefit the people of Liberia.

In a recent analysis of the Liberian Government-China Union concession contract, International rights group, Global Witness, and local environmental advocacy institution, Green Advocacy, observed that the contract includes positive commitments to transparency through the contractual obligation to join the Liberia Extractive Industry Transparency Initiative. The groups also welcomed terms of the agreement which call for the disclosure of information on payments to the Government and publishing of the contract. The agreement, the groups noted, also contains robust transfer pricing provisions and the Concessionaire and the Operating Company are made jointly and severally liable. These provisions, Global Witness and Green Advocates observed were notably lacking in previous concession agreements.

A campaigner for Global Witness, Natalie Ashworth said, the Liberian government should be congratulated on negotiating an Agreement which has the potential to play a very positive role in Liberia's development and which is a significant improvement on other recent natural resource concession contracts between the state and international companies. "We encourage Liberia's lawmakers now to use their voice to ensure that the final, ratified, Bong Mines contract represents the best possible deal for Liberia and its people," the Global Witness official emphasized.

The Groups also lauded measures taken by Government toward transparency in the Agreement, a principle they described as important safeguard against corruption and should be applauded.

The Government, Green Advocates Executive Director Alfred Brownell noted, must now apply this kind of transparency to the way it spends and accounts for the US$40 million signature bonus.”

The Executive Mansion quotes President Johnson Sirleaf as saying the signature bonus will be used for the rehabilitation and construction of roads and bridges throughout the country, in line with budgetary appropriations.

Under the agreement, China Union will pay the Government of Liberia a US$40 million up-front signature bonus.

The fact the Liberian Government has publicly announced this payment, the groups noted, is positive. The Groups pointed out that this development is contrary to what is practiced in other resource-rich countries, where signature bonuses are often kept secret, thereby raising the risks of corruption.

Despite the positive aspects of the contract, Green Advocates and Global Witness observed, the Agreement is vague in parts, potentially leaving it open to abuse. Greater clarity and rigor, the groups said, is required to prevent serious problems from arising in the future. “Weaker elements of the contract which the Legislature should consider amending are the provisions relating to the resettlement of communities, the fiscal stabilization clause and the clauses governing the feasibility study,” the Advocacy Groups recommended.

“Ultimately, the contract is only as effective as its implementation. As such, it is critical that significant international support is given to develop state capacity, local civil society and legal avenues to provide the checks and balances needed to ensure oversight of the contract's execution,” Green Advocates and Global Witness recommended.

Source: The Liberian Government

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