Liberia

Executive Summary

Liberia offers opportunities for investment in mining, agriculture, forestry (timber), and financial services.  A commodities-based economy, Liberia relies on imports for more than half of its cereal needs, including rice, Liberia’s most important staple food. The COVID-19 pandemic has negatively affected all sectors of the economy, and the International Monetary Fund projects negative two and a half percent growth for 2020.

Liberia would require considerable foreign direct investment (FDI) to fulfill its development goals and potential.  However, low human development indicators and poor roads and lack of reliable internet access throughout most of the country constrain investment and development.

Most of Liberia lacks power supply, though efforts to expand access to electricity are ongoing through development of a grid from the Mount Coffee Hydropower Plant, the West Africa Power Pool’s cross border electrification projects, and other internationally supported energy projects.

The 2020 World Bank Doing Business Report ranked Liberia as 184th out of 190 economies in trading across borders, 184th in dealing with construction permits, and 180th in registering property.  Corruption is endemic in Liberia. The 2019 Transparency International Corruption Perceptions Index ranks Liberia at 137th out of 180, down from 120th in 2018. More promisingly, the Doing Business Report ranked Liberia as 75th in starting a business and 76th in paying taxes.

The Government of Liberia formed a Business Climate Working Group (BCWG) in 2018 to improve the investment climate.  The BCWG held several fora, including one in May 2019 entitled “Resolving Constraints to Trading Across Borders.” With the implementation of an IMF-supported program to improve fiscal and monetary policies, Liberia may soon experience a more favorable environment for private investment.  The business climate could also improve with increased collaboration between business chambers, industry associations and the Liberian government, as well as through continued and persistent efforts of international donors.

Following frequently lengthy negotiations with the government, investors developing long term concessions for agricultural or extractive businesses report facing resistance from local communities, which claim the government has not consulted with them about land use.  Further, communities and employees expect concessionaires and other private investors to provide significant support including education, healthcare, and housing.

Liberia is a country rich in natural resources, agricultural land, and abundant rainfall. Agribusiness and extractive industries investors in particular may find that Liberia merits careful consideration.

13. Foreign Direct Investment and Foreign Portfolio Investment Statistics