Political and Security Update
Liberia’s National Elections Commission (NEC) has validated 22 political parties to participate in the October 2017 Presidential and Legislative elections, and more than 20 others have applied and awaiting qualification by the NEC. Calls have been made for political mergers to reduce the number of parties.
Contestants would be vying to replace President Ellen Johnson Sirleaf who will be completing her second and final term of office, and 73 seats in the House of Representatives. The ruling Unity Party (UP) endorsed Vice President Joseph Boakai.
The long-running political crisis in the House of Representatives has been resolved with the election of a new speaker, Emmanuel Nuquay. Mr. Nuquay was elected on Wednesday, October 5, 2016 after the Supreme Court of Liberia denied the issuance of a writ of prohibition on members of the House of Representatives to prevent them from electing a new speaker. Former Speaker Alex Tyler petitioned the Supreme Court, challenging his removal by a resolution signed by two-thirds majority members.
On June 30, 2016, the United Nations Mission in Liberia (UNMIL) on June 30, 2016 handed over security responsibilities to the Government of Liberia. Currently there are 1,240 military personnel and 606 police personnel of UNMIL remaining in the country. The UN Security Council has extended the mandate of UNMIL through the end of 2016. Many Liberians are concerned about the prospect of the Mission’s withdrawal and potential lack of UN support during the 2017 elections. A two-week UN Strategic Assessment Mission found that there is no credible imminent external threat to Liberia’s security.
The continued low global commodity prices and post-Ebola decline in official inflows have created significant challenges for Liberian economy. Gross domestic product (GDP) growth in 2015 was flat, compared to 0.7% in 2014, arising mainly from the continued decline in activity in the iron ore and rubber sectors, which have been the main drivers of economic growth in recent years. There was a reduction in inflationary pressures in 2015, due to declining domestic food and petroleum prices during the second half of the year; the average inflation rate decreased from 9.9%in 2014 to 7.7% in 2015. The current account deficit widened from 32.5 to 33.6% of GDP over the same period, reflecting weaker exports receipts and the Ebola-related surge in imports.
In 2016, economic growth is expected to rise to 2.5%, mainly due to a rebound in services and the start of gold production, while inflation is expected remain in the single digit range. Liberia is currently struggling to implement its post-Ebola economic recovery plans, given the multiple challenges the country has to grapple with simultaneously, in FY2016/2017, including the need to continue with infrastructural development, taking responsibility for national security following the UNMIL drawdown and the financing of the upcoming general elections.
Over the medium term, economic growth is expected to increase to 5.0% on average, due to a recovery in mining, improvements in infrastructure, particularly energy and roads, and higher agricultural productivity. The fiscal position should also improve thanks to the authorities’ commitment to improving domestic revenue mobilization and contain spending. Resolution of the backlog of non-performing loans and improving bank profitability could support economic growth through increased credit, especially for small- and medium-size enterprises (SMEs).
Last Updated: Oct 25, 2016