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Regulatory failure, a function that undermines public sector development: “Liberia in focus”

Regulatory failure is defined in different ways by different people. According to the London School of Economics, “there is no agreement on a single, clear-cut and universally applicable definition of what might constitute a ‘regulatory failure.’ 

In his paper on regulatory governance, Prof Jeroen van der Heijden, Chair in Regulatory Practice of Victoria University of Wellington, defines the concept as a “lack of success in realising the desirable societal outcomes that a piece of regulation was developed to achieve.” But even this definition, he admits, is inconclusive. 

For this report, this researcher will look at Liberia’s regulatory failure within the context of this definition and to assess the legal and desirable societal outcomes of some of the key regulatory agencies in Liberia, particularly the National Port Authority, the Liberia Drug Enforcement Agency and whether or not those outcomes were achieved. 

First and foremost, it is important to establish the legal framework under which these public institutions in Liberia were built and why.

For instance, the National Port Authority (NPA) was established by an Act of the National Legislature in 1967 and amended in 1970 as a state-owned corporation to manage, plan and build all public ports in Liberia. 

In partnership with the public and private sectors, the NPA has a strategic vision to strengthen the economy, improve international trade, and spur tourism and community development by making its ports of entry and surrounding areas the most efficient and effective for generations to come. However, it cannot be said that the port authorities have efficiently and effectively managed the port.

Again, the Liberia Drug Enforcement Agency (LDEA) is a semi-autonomous agency under the supervisory authority of the Ministry of Justice, responsible for the effective and efficient enforcement of laws about controlled drugs, substances and precursors, including essential chemicals.

The Act, among other things, permits the Liberia Drugs Enforcement Agency to play a drug-crime-focused role in national enforcement by implementing measures to protect the territorial borders of Liberia from the importation and exportation of drugs and controlled substances. 

In Liberia, there is a drug law that the 54th National Legislature recently passed, and it frowns on the importation, sale and usage of narcotic substances in the country. 

The drug law, before the President for signature, indicated that those found culpable in the sale and importation of narcotic substances would be jailed without bail. End users, on the other hand, the law says, will have access to bail, but there will be other punitive measures to deter others. 

Despite the legal framework and societal expectations of these agencies, the nation and its people continue to experience some amount of regulatory breaches from time to time.

One of the common examples of regulatory failures in Liberia is the unregulated movement of motorbikes and tri-cycle riders (Keh keh) in Monrovia and other parts of the country.

The Ministry of Transport is the state-owned institution charged by an Act of Legislation to formulate and administer transport activities in Liberia.

These riders’ mainly young people, are seen moving passengers daily and plying almost all the major roads and street corners in the city and beyond amid an instituted no-go zone regulation for certain areas declared by state authority.

Their movement bears a record of revenue for their livelihood. However, due to dangerous driving, many have fallen prey to accidents, some of which have led to the deaths and injuries of tens of thousands of riders in Liberia. 

Hard-core criminals are also giving a negative reputation to some of the good motorbike and tricycle riders. Apart from violating traffic regulations, Liberians are beginning to associate property theft and the snatching of bags, cellphones and other valuable items from ordinary people to some bike riders in Monrovia.

Regulatory failure, a function that undermines public sector development: “Liberia in focus”
Image Source: Daily Observer Newspaper.

Flouting city ordinance laws by unscrupulous individuals concerning garbage disposal in Monrovia is another regulatory failure that continues to send a bad omen to visitors and foreign residents about the cleanliness of Liberia’s capital, Monrovia.

In the filth is the Monrovia City Corporation (MCC) which ought to be providing oversight responsibility regarding regulations aimed at keeping the city clean and green. The MCC is also responsible for Waste Management in the city.

Regulatory failure, a function that undermines public sector development: “Liberia in focus”
Image: Waste site in Monrovia.

But, as we view regulatory failures, it is also critical to draw attention to one particular subject that is affecting the future jurors (young people) of Liberia, and that is ‘narcotic substances.’

The proliferation of narcotic substances among young people in Liberia is alarming. It becomes even more troubling waking up to the news of the importation of huge quantities of drugs leaving the nation’s biggest port of entry, the Freeport.

Sometime in October 2022, the news media was awash with reports of a huge quantity of drugs that slipped through the Freeport of Monrovia.

Media reports noted that the container believed to be ‘frozen food’ cargo had cocaine worth over US$100 million. 

According to Front Page Africa Newspaper, the suspected ringleader, a Brazilian named Gustavo Henrique, was recently arrested along with two others in Sierra Leone while trying to flee Liberia.

The Liberia Drug Enforcement Agency has since burned the US$100 million drug, but an investigation is said to be ongoing. This slippage in regulation followed the failure of regulators to honour a given instruction. 

Part one of the statutory law creating the Liberia Drug Enforcement Agency (LDEA) states, among other things, that the LDEA shall formulate, monitor and coordinate national programs for combating illicit drug product trafficking and drug money laundering.

22.104b-c of Part one (1) of the law also authorises the Liberia Drug Enforcement Agency to investigate the alleged offences, arrest and apprehend as well as search all alleged violators and seize for confiscation, the effects or proceeds as provided by law and take custody thereof. 

The law and the societal expectation of the LDEA, notwithstanding, drugs with a market value of $100m, still slipped through its ports.

The container, which had the drugs, interestingly had a Global Tracking Maritime Services (GTMS) stamp urging the Liberian authority to conduct a physical examination on the container before its exit from the port. This, however, was never done.

Regulatory failure, a function that undermines public sector development: “Liberia in focus”
Inspection Certificate Order (GTMS).
Regulatory failure, a function that undermines public sector development: “Liberia in focus”
Drug bust (cocaine).

The drug bust comes at a time when youth are walloping in drugs and other unscrupulous activities, with ghettoes springing up in every community across the country. 

Regulatory failure, a function that undermines public sector development: “Liberia in focus”
A group of At-Risk Youth in Liberia, Source: ©UNFPA Liberia.

A senior economist and public sector analyst for over 13 years in Liberia, Sam Smith provides insight into regulatory failures in the public and private sectors.

Smith said the government provides the enabling environment so that the private sector can take the lead; according to him, this gives the government the responsibility of a regulator.

According to him, in most countries, most meaningful growth is undertaken by the private sector, not the public sector.

“In those countries, companies are driven by profit, so you have two or three companies producing the same commodity. If you don’t have a neutral institution regulating their activities, they might harm the public interest or public goods. So the presence of government in that setting ensures that competition is healthy, the consumer gets value for money, and the producer is protected. That is the essence of having regulation; people’s behaviour should be regulated.”

Mr Smith, a Harvard-trained Public Administrator, stressed that people are self-interested, adding, “they behave in a manner that gives them joy; if they are firm, they behave in a manner that gives them the greatest profit. In some instances, their objective may come contrary to the objective of the public.”

Why are there regulatory failures?

“One thing I can put my finger on for which we have regulatory failure is the lack of political will in enforcing the law and self-interest. Regulators themselves have their interests. The people constitute governments; people come from different backgrounds. In a democracy, contributions are made to politicians for whom politicians have a constituency they must protect,” said Sam Smith.

He said this creates what he called the ‘Agent Principal’ problem.

“Am I protecting the interest of the higher contributors to my campaign, or am I protecting the interest of those who voted for me?” he asked.

“Having different or multiple interests, protecting the interest of your voting constituency or protecting the interest of your campaign contributors; that could be some of the reasons we have Regulatory Failures.”

He mentioned that regulatory failure combines several factors, such as failure to implement the law in the book and failure to draw the line between private interest and public interest.

On the question of how we end up with these failures, he said people have not been answerable for all their actions taken in the past.

The way out of all these challenges, the Harvard train indicated that the government must make accountability the hallmark and, at the same time, make communication a key priority so that citizens get informed about what is happening and how it benefits them.

Dr Artemus Gaye, a Co-executive officer of the Prince Ibrahima & Isabella Freedom Foundation based in the USA and West Africa, in an interview with DUBAWA, provided a perspective on the different types of ‘Regulatory Failure’ and its impact on society.

Dr Gaye defines ‘Analytical failure’ as knowing and understanding the analysis of a particular situation and its flaws. Intervention failure, he said, is about knowing why the regulatory activity was inadequate or flawed in mitigating or remedying problems or the identified problem(s). 

“Coordination failure, the ineffectiveness of the various bodies to coordinate in addressing the problems; political failure (the failed system due to poor political planning that creates lingering tensions and unresolved political issues) and, Design failure (this occurs when the laws and regulatory bodies and statutes including resources are inadequate to address these issues,” said Dr Gaye.

When asked about his view on the entire subject? 

He said: “This is a subject matter that must form the basis of well-planned public policies and nation-building process as in the case of Liberia.”

Dr Gaye, a writer of several historical kinds of literature, including ‘The Tossed American Pie,’ averred that while there are various views on it, he can safely argue that there is no single emerging definition for regulatory failure.

But he noted that “when the wrong people and the lack of socio-political will of a nation become the engines to drive the necessary common good of a people or a nation,” adding this is the reason we have a facade democracy in Liberia and a country ranked at the bottom of global development.”

According to him, it is more of a societal problem because of the failure of those in charge of the resources and power structure to abide by and implement these laws.

Dr Gaye believes that corruption in its many forms – administrative, financial, and poor skill sets leads to these systemic failures. “Can a plane be piloted by a plumber? Misplacement and the lack of political will lead to this demise.”

He mentioned that Liberia and other African States “have not been attentive to history and selective in our narrative. Until we can re-examine ourselves as a nation and reset our national agenda based on the merit system and the enforcement of good laws, we will always fail the regulatory test,” Dr Gaye accentuated.   

What are the ramifications?

He said: “We become a poor nation, failing at all the indices and with Stockholm syndrome being the order of the day.”

Pursuing the way forward for Liberia, Dr Gaye stated that a national conference and educational awareness of the importance of these rules are necessary to safeguard the common good.

He added that it was important that those in charge as regulators should succeed in managing public expectations as they manage risks.

“Public trust is key to this process as it can help to shape public confidence. Once these steps are taken, the general public will see those in charge responding to their needs rather than pointing fingers and playing the blame game.”

 “The researcher produced this Media Literacy per the DUBAWA 2023 Kwame Karikari Fellowship partnership with Independent NewsPaper/OK FM  to facilitate the ethics of “Truth” in Journalism and enhance media literacy in the country.” 

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