Recalling the senseless Rice Riot of 1979
By E. Sumo Jones, Sr.
July 27, 2004
As former Minister of Commerce, Industry and Transportation from 1981-1982 during which period we succeeded in preventing rice shortage on the Liberian market without passing any increase in the price of rice on the world market to the consumers, I wish to attempt to answer the question raised in the article published on your website dated July 14, 2004, under the caption, "RICE IMPORTERS WANT PRICE ADJUSTED, OR ..." from The Inquirer in which rice importers are demanding price adjustment with implied threat to stop importing rice into the country.
Recalling the senseless Rice Riot of 1979 as a result of an increase in the price of a bag of rice approved by the Government due to scarcity that motivated a very violent and bloody riot in Monrovia led by Bacchus Matthew which resulted in the massacre of hundreds of Liberians, I wasted no time in submitting a proposal to the Head of State and Chairman of the People's Redemption Council, CIC Samuel Kenyon Doe a Rice Price Stabilization plan that would prevent any increase in the then $21.00 price for a 100 pound bag of rice irrespective of any increase or increases in the price of rice on the world market immediately after I took over the Ministry. We assured the PRC Government that if the proposed plan was approved, the cost of a 100 pound bag of rice would remain at $21.00 with no additional cost to the consumers and that their would no longer occur shortage of rice on the Liberian market because the Ministry would have adequate funds with the Liberian Produce Marketing Corporation to stabilize any increase in the price of a bag of rice in Liberia. The PRC Government approved of our proposal which plan was read on ELTV, published in the local newspapers and broadcast by the local radio stations including ELBC.
The essence of the proposal was that a rice stabilization fund would be set up at LPMC which the Minister of Commerce was Chairman of its Board then and that anyone applying for a permit to import rice to Liberia would have to deposit 25% of the total cost of the rice to be imported and the deposit would be nonrefundable if the would-be importer failed to import the rice. When the rice arrived, the importer had to pay a dollar per each bag of rice imported to LPMC after which, the security deposit was returned to the importer who could not sell for more than the $21.00 per bag authorized price.
Prior to the establishment of the Rice Stabilization Fund, we found out that would-be importers would get permits to import any quantity of rice for practically nothing with no guarantee that they would import the rice and so, 99% of the time, people obtained permits and failed to import the rice while the Ministry was expecting the rice to arrive. It was the failure to import the rice for which permits were issued that largely contributed to the shortage of rice. That was the period in which the Ministry placed too much confidence in the promises made by would-be rice importers that they would certainly import the rice and on the time designated.
The forfeited security deposits from those who fell back on the importation and the $1.00 paid per a bag of rice to LPMC constituted the stabilization fund which was used to subsidize the price increase that would have to be passed on to the consumers should the price of rice on the world market shot up.
Within a brief period of time after the process was started, there existed adequate amount in the Fund and, sense the price of rice on the world market was not frequently increased, we were able to maintain regular increase in the Fund because we did not have a cause to withdraw from it to stabilize any price increase therefrom. Furthermore, when the program enforcement began, no importer could afford to forfeit his or her security deposit by failing to make the rice for which the permit was issued available in the country and on time. Therefore ,rice was always plentiful on the Liberian market with no shortage in supplies up to the time I was transferred to the Ministry of Labor in November, 1982..
I would suggest that if the Ministry has abandoned the rice stabilization program, it should reactivate the program and there would be no need to increase the price for a bag of rice and shortage of rice will be prevented. However, taking into consideration the policy of the Ministry of Commerce not to allow any rice importer to import into Liberia rice more than 60% broken through a sample test that the Bureau of Standards of the Ministry conducts, to avoid people from importing rice of the quality of a hog fee into the country which is below the standard for human consumption, I hope the existing price of $17.00 per a bag is consistent with the minimum quality standard regulated by the Ministry which is not harmful to the health of the consumers.
The process calls for a rigid and vigilant monitoring of the standardization of the quality of the rice imported to be sold, the number of rice permits issued to be consistent with the quantity of the tons of rice being ordered to make sure that rice is always available to buy and that the security deposits in the Fund and the regular import fee of $1.00 per bag are deposited into the Fund with copies of the receipts being forwarded to the Ministry of Commerce by LPMC. All returns of security deposits to importers who fulfill their commitments must sign receipts in triplicates with a carbon copy made available to the Ministry. There should be a regular audit of the account by the Ministry and, at no time should the Government borrow from the Fund or demand withdrawal from the Fund for its use to avoid any tampering with the Fund for a purpose other than that it was set up for. The Fund should be deposited into a special account in a prime local Bank and all withdrawals must be countersigned by the Minister of Commerce. Of Course, the Government has oversight authority over the Fund and can, at anytime, inspect and audit the account.
I shall be obliged were you to kindly publish this letter and copy one to the Inquirer newspaper also for publication.