Overview

  • Political and Security Update

    Liberia is a relatively compact and verdant country with a small population of 4 million (2016) and a damp coastal climate with six-month-long summer rains. Founded by freed slaves, it has old, established ties to the US. Its destiny has been otherwise defined by international shipping access to its Atlantic Ocean ports, and the dynamics of its Mano River Basin interior, a region that it shares with its two of its neighbors, Sierra Leone and Guinea. It also borders Cote d'Ivoire.

    Liberia's National Elections Commission (NEC) declared political campaigning opened in July 2017, ahead of presidential and in legislative elections in October. The NEC allowed 984 individuals from 26 political parties to contest 73 seats in the House of Representatives, and another 40 to run for the Presidency and Vice-Presidency. More than 5,000 polling places were set-up in Liberia’s 15 counties. The election signals the end (in January 2018) of President Ellen Johnson Sirleaf's terms in office, and a post-conflict turning point for Liberia. The last time there was a democratic transfer of power was in 1944.  

    In December 2016, the UN Security Council extended the mandate of the UN Mission in Liberia (UNMIL) for a final period until March 30, 2018. Under Chapter VII of the UN's Charter, UNMIL’s mandate included civilian protection, advising Liberia on justice and security reform, supporting the promotion, protection, and monitoring of human rights, and efforts to combat sexual and gender-based violence. The Mission’s 1,240 military personnel had been reduced to no more than 434, and its police strength to 310. The UN Security Council had called on the Government Of Liberia to prioritize national reconciliation and economic recovery.

    Economic Overview

    Following the twin shocks of the 2014/15 outbreak of the Ebola Virus and a global slump in commodity prices, Liberia’s economy is expected to recover from -1.6% in 2016 to 2.6% in 2017. The slowdown in economic activity has had a negative impact on fiscal revenue, inflation, exchange rate stability, and poverty rate. On top of this, the government had to take full responsibility for security following UNMIL's major drawdown in June 2016. The medium-term outlook is, however, more positive, but with significant downside risks. The robustness of Liberia’s recovery will depend on the effective diversification of the economy, development of strong institutions, and a smooth political transition.

    Inflationary pressures increased during the first half of 2017. Headline inflation averaged 12.4% in the first half of 2017, compared with 7.3% the previous year, driven by the relatively fast pace of the depreciation of the Liberian dollar against the U.S. dollar (of 20% in the first half of 2017 compared to 11% in the same period in 2016). Other factors include excess liquidity in terms of Liberian dollars, and the relative shortage of inflows of foreign exchange. The resultant rise in the cost of living, especially the cost of food, which is mostly imported, increased fiscal pressures. Limited employment continues to undermine the welfare of Liberians in both urban and rural areas. 

    Medium-term growth prospects remain positive. Real GDP growth is projected to recover driven by improvements in agriculture and services, and to some extent mining (particularly gold production) during the second part of 2017. Growth is estimated to reach an average of 3.6% by 2019. Recovery will be underpinned by the potential benefits of improved infrastructure development, namely more access to road transport networks and cheaper sources of electricity.

    On the other hand, the country's current account deficit is projected to remain at 26% of GDP over the medium-term due to the anticipated decline in official transfers of money into the country. Commensurate with GDP per capita growth and single digit inflation, Liberia's poverty headcount ratio (at the national poverty line) is projected to fall to 45.2% in 2019, compared to 49.8% in 2017.

    Last Updated: Oct 09, 2017

  • World Bank Group (WBG) Engagement

    The Liberia Country Partnership Strategy (CPS) FY13-FY17 has been supporting the government’s Agenda for Transformation (AfT) to contribute to sustained growth, poverty reduction and shared prosperity, while coming out of a state of fragility and building up some economic resilience. Its key pillars include investing in: economic transformation; human development; governance and public sector institutions. In 2014, the CPS program was refocused to support the government’s post-Ebola Economic Stabilization and Recovery Plan. As the CPS comes to an end, the Bank has begun to prepare a Systematic Country Diagnostic (SCD), which will identify constraints impeding poverty reduction. The SCD is the preparatory stage for the preparation of the Country Partnership Framework (CPF).   

    Portfolio in Liberia

    The WBG portfolio in Liberia comprises 14 active International Development Association (IDA) projects with a net commitment of $597.91 million. Its main focus is investing in infrastructure, especially roads, bridges, and energy, along with developing the human and institutional capacity necessary to deliver results in these sectors. In addition, the WBG continues to work with the government to diversify agriculture, improve service delivery in education, health and social protection, and strengthen public financial management and governance mechanisms.

    The Cheesemanburg Landfill and Urban Sanitation project is currently in the pipeline. This project will improve the collection and disposal of garbage in Monrovia and its surrounding areas. The Bank is providing support to the project with other development partners in the Liberia Reconstruction Trust Fund (LRTF)

    Another project in the pipeline is the Smallholder Agriculture Transformation and Agribusiness revitalization Project (STAR-P), which aims to enhance the agricultural productivity of smallholder farmers and facilitate inclusive private sector investment in selected agricultural value chains. Other interventions are in transport and education, land administration, and fisheries and poverty reduction. The Health sector has been a critical area of need and will continue to attract the support of the Bank.  

    Last Updated: Oct 09, 2017

  • International Finance Corporation (IFC) in Liberia

    IFC investments and advisory services in Liberia will be targeted at private sector development. As of December 2016, investment comprised: (i) $37.3 million of financing in four Liberian banks under the Ebola Emergency Liquidity Facility and Global Trade Facility; (ii) $8.5 million in agriculture financing in the rubber and cocoa sectors; (iii) $20.2 million in the mining sector; (iv) and $13 million (out of $18.5 million) for seed investment in the West Africa Venture Fund and for private equity investment in small and medium enterprises.

    In January 2015, the WBG Board approved a $25 million Rubber Renovation Program to support small- and medium-sized Liberian rubber growing companies with long-term financing to help them replant rubber trees and improve their existing operations. 

    $2.5m has been allocated to Liberian Bank, and negotiations are progressing with other banks.  

    Agriculture and financial services are two priority sectors for the IFC in Liberia. These sectors present viable and sustainable investment and employment opportunities. Extensive reforms in the past six years have made the sectors more investment ready. IFC’s on-the-ground presence since June 2007 has enabled it to scale up its activities, with discussions ongoing for a number of potential investments in agribusiness, power, and financial services.

    Last Updated: Oct 09, 2017

  • Donor Coordination

    The WBG develops and implements its projects and programs in coordination with development partners, such as the African Development Bank, European Union, United States Agency for International Development, and Swedish International Development Cooperation Agency. Other partners include China, Germany, Japan, Sweden, Norway, the United Kingdom, Ireland, and the United Nations.

    The WBG has been a major proponent of aid coordination through the LRTF, as well as the donor groups in public financial management, public sector reform, agriculture, social protection, energy and health. The LRTF is a multi-donor trust fund for infrastructure, administered by the World Bank and supervised by an Oversight Committee that includes the Government of Liberia and contributing donors. 

    Last Updated: Oct 09, 2017

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LENDING

Liberia: Commitments by Fiscal Year (in millions of dollars)*

*Amounts include IBRD and IDA commitments


PHOTO GALLERY

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Additional Resources

Country Office Contacts

Main Office Contact
German Embassy Compound
Tubman Boulevard, Oldest Congo Town
Monrovia, Liberia
+231-88-6-531-407
Monrovia, Liberia
Michael Nyumah Sahr
Communications Associate
+231-88-6-606-967
msahr@worldbank.org
Washington
Laura Kullenberg
Country Program Coordinator
1818 H Street NW
Washington DC 20433
USA
lkullenberg@worldbank.org