Liberia

Liberia’s political landscape remains dynamic and, at times, contentious. Recent political debates have focused on issues such as corruption, electoral reform, decentralization, and the rule of law. The main opposition political party, Coalition for Democratic Change (CDC), led by former President George Weah, is strengthening its party’s structure and infrastructure, looking ahead to the 2029 Presidential and Legislative elections. Opposition political parties have been engaging in discussions without concrete agreements.

Two major drug bursts this year amounting to 4,208.6 kg of cocaine with monetary value of about $336.2 million, heightened national security alert. These cases subsequently became linked to broader investigations into alleged transnational trafficking networks. President Joseph Boakai has publicly promised a tougher crackdown on drug trafficking in Liberia and vowed to expose and destroy the networks behind it.

Simmering border disputes, driven by historical and resource tensions between Guinea and Liberia in Lofa County remained calm, though Guinean forces remain on the Liberian side of the disputed border area. These tensions were eased off because of President Joseph Nyuma Boakai utilizing diplomatic approach within the framework of the Mano River Union (MRU) and Economic Community of West African States (ECOWAS).

The Government has outlined its vision for Liberia’s development through the ARREST agenda – an acronym representing Agriculture, Roads, Rule of Law, Education, Sanitation, and Tourism. The Government wants to leverage these key sectors to reverse economic stagnation, emphasizing the need for comprehensive and interconnected development strategies. The Boakai administration continues to push its governance reform and development agenda forward. The plan focuses on strengthening the economy, enhancing public services, and reforming government institutions.

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Liberia’s economy grew by 5.1% in 2025, supported by a strong mining rebound and steady expansion in services. Mining growth surged from 2.1% in 2024 to 17%, significantly boosting industrial output. Services expanded by 4.6%, driven by trade, electricity supply, and transport, while agricultural growth slowed to 2.6% as price effects waned, and rubber production weakened. On the demand side, private consumption and exports increased, while public spending fell amid continued fiscal consolidation.

Inflation remained contained in 2025, edging up to 8.5% from 8.3% in 2024, supported by tight monetary policy, a broadly stable exchange rate, and moderate global food and fuel prices. Headline inflation fell sharply to 3.1% year-on-year (y/y) in February 2026, but fuel price pressures associated with the Middle East crisis pushed it to 5.8% (y/y) in April before it stabilized at about 5.0% (y/y) in June. With price pressures easing, the Central Bank of Liberia cut its policy rate by 250 basis points to 16.0% in July 2026 to support economic activity. The Liberian dollar depreciated by less than 1% in 2025, compared with 8.5% in 2024, and remained broadly stable in 2026 at around L$180 per US dollar.

Liberia’s fiscal position strengthened in 2025. The overall deficit narrowed to 2.1% of GDP from 2.5% in 2024, reflecting stronger domestic revenue collection and expenditure restraint. The primary deficit also fell, from 1.3% to 0.4% of GDP, while public debt declined from 56.4% to 55.1% of GDP.

The current account deficit narrowed from 8.1% of GDP in 2024 to 7.0% in 2025, supported by strong gold and iron ore exports and increased remittances. It was financed mainly through foreign direct investment in the mining sector and official concessional borrowing. However, Liberia’s external buffers remained limited, with reserves covering about 1.6 months of imports at end-2025.

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Liberia commissioned its first utility-scale solar photovoltaic facility, a 20 MWp plant located at the Mount Coffee Hydropower Plant. In parallel, the Mount Coffee Hydropower Plant was restored to its full installed capacity of 88 MW following the successful repair of the damaged 22 MW Unit 1. Further reinforcing this progress, the Government of Liberia secured $45 million in financing from the World Bank Group to expand electricity access in rural and off-grid communities. Collectively, these achievements demonstrate Liberia’s growing commitment to developing a more reliable, inclusive, and sustainable energy sector.

The Liberia Women Empowerment Program (LWEP) aims to improve social and livelihood outcomes for women and girls by promoting positive social norms, preventing gender-based violence (GBV), and expanding economic opportunities. Working across 498 communities in six counties, the project is expected to reach over 224,000 people through community mobilization and GBV prevention activities and support 36,000 women with livelihoods and business development services. To date, SASA! community activism has been implemented in 465 communities, benefiting more than 203,000 people

As of September, the Recovery of Economic Activity for Liberian Informal Sector Employment (REALISE) Project benefitted approximately 64,458 households or 304,561 individuals across 14 of Liberia’s 15 counties.

The Rural Economic Transformation Project continues to support increased productivity and market access for smallholder farmers and agri-enterprises across selected value chains in Liberia. The project has reached 66,097 direct beneficiaries (target: 96,000), with 50% being women.

Two IDA-financed operations in the health sector. One focusses on reproductive, maternal, newborn, child, and adolescent health and nutrition (RMNCAH-N) and health security, respectively. The new Health Security Program aims to enhance health sector performance – including through pandemic preparedness as well as disease surveillance and response.

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The World Bank Group Country Partnership Framework for Liberia (FY25–FY30) guides support for more and better jobs through four priority outcomes: education, energy access, accountable and transparent governance, and private investment, with particular emphasis on agroindustry and forestry.

As of September 14, 2026, Liberia’s active portfolio is worth $1,061.60M and comprises 18 projects financed from multiple sources including national (13 projects) and regional (5 projects) IDA and sector specific/thematic trust funds. Cumulatively, about 44.98% of the portfolio has been disbursed towards key infrastructure sectors (including roads, water, and energy), health systems strengthening & disease surveillance, agriculture, fisheries, social safety net systems, governance reforms, women empowerment and improvements in investment, finance, and trade. The portfolio currently has no actual problem projects and has achieved 100% proactivity. Two projects are scheduled to close in the second quarter of FY27. Continued portfolio reviews and disbursement deep dives will remain important for accelerating implementation, resolving inactive account and expenditure issues, and improving portfolio performance.

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IFC strategy, in line with the WBG country partnership framework, focuses on creating a conducive business environment by supporting reforms to reduce regulatory burdens, streamline business processes, improve the investment climate, and mobilizing private investment to generate both domestic and foreign private capital into productive sectors, moving beyond reliance on public and donor financing.

From 2012 to 2025, IFC has implemented projects in Liberia aimed at improving the business climate and fostering private sector growth. The business climate reform initiatives, primarily funded by SIDA, address areas such as access to credit (debt resolution, financial inclusion, the development and enhancement of a collateral registry), consultative public-private dialogue, and trade environment improvements. IFC Advisory, in collaboration with industry partners, is currently working on a range of programs that seek to support investment in agricultural tree crops by ensuring traceability and EUDR compliance, local supplier development and linkages that ensure integration of Liberia’s SMEs into concessionaires’ value chains, enhance access to finance, including through digital and agent banking, expand energy access and ensure capacity within government to develop and execute a public-private partnerships.

IFC is also looking at investment in Liberia through the Africa Fragility Initiative (AFI), which is a five-year project aimed at advancing private sector development in thirty-two fragile African countries. The team supports investment and advisory projects through the Local Champions Initiative (LCI). The LCI offers two approaches: firstly, country portfolio expansion through tailored technical assistance to the most mature sponsors; and secondly, business expansion though technical advisory support to high-potential but less mature sponsors with the aim of building a sustainable pipeline for direct IFC investments.

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