The_Open_Door_deel1

-234-
1975, amounted to $ 4,836,000.00 (73) half of which amount
represents the Government's loss of revenue. Also excluded are
the currency exchange losses which LAMCO wrote off in the 1968 -
1976 period. As repayment of loans took place in the original
currency of the loans but the Company's earnings were based on
a U.S. dollar which was subject to devaluations and a continued
depreciation in this period some $ 22.7 million currency exchange
losses were incurred (74).
As has been discussed before, debt amortization and depreciation
are basically referring to the same items (as the loans had been
used to finance the acquisition of long-life assets which were
subsequently gradually written off). Therefore it may be said
that of the total of $ 214,211,000.00 which was spent on debtamortization
and depreciation in this 15 years' period at least
50? was spent on debt-amortization alone. But it is very likely
that debt-amortization totalled more than 50? as the rate of loan
repayments exceeded the rate of depreciation, the terms of the
loans being shorter than the lifetime of the concession on which
the depreciation was based, at least until 1969 (75). Therefore
in Table 14 debt-amortization was estimated at 60? of the amount
of $ 214,211,000.00, i.e. $ 128,526,600.00.
In the case of Libeth, the loss of potential revenue because of
the depletion allowance (though Libeth is not the owner of the
sub-soil in the concession area) and the deduction of interest
payments alone already amounted to some $ 33.9 million (76).
This amount nearly equals the total amount of corporate income
taxes actually received by the Government ($ 36.6 million).
If the loss of potential revenue due to debt-repayments is added
the total fiscal "costs" of these three privileges even exceed
the amount of corporate income taxes (still, however,
disregarding the loss of revenue caused by duty-free privileges
and other tax exemptions).
It may be said that the Government's 50? interest in LAMCO was
obtained by the granting of this 70 years ' concession - including
the granting of various incentives - and the ownership of the
sub-soil which includes (or included) the ore. In financial terms,
the Liberian Government made more "investments" in the 1963 -
1977 period than its (private) partners, for the financial value
and fiscal costs of certain of the privileges benefiting the
concessionaires far exceed the private investors ' equity
investment in the mining venture. Therefore, it seems
appropriate to decide whether (a) the Government's share in the
profits of the venture will be increased in accordance with the
financial sacrifices it has made in the past ans still continues
to make, or (b) these privileges which present considerable
losses to the National Treasury and whose enjoyment can no
longer be justified by the initial intention, i.e. to make
considerable investments in a project whose profitability has
not yet been assured more attractive, will have to be eliminated.