About Liberia

58.21

Life expectancy at birth (2014)

35.07

Birth rate (2014)

9.9

Death rate (2014)

69.19

Infant mortality rate (2014)

770

Maternal mortality (2010)

4.81

Total fertility rate (2014)

2.52%

Population growth rate (2014)

60.8%

Literacy Rate (2010)

5.1%

Youth unemployment Rate (2010)

Introduction

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Liberia is a low-income country that relies heavily on foreign assistance. Civil war and government mismanagement destroyed much of Liberia's economy, especially the infrastructure in and around the capital, Monrovia.

Many businesses fled the country, taking capital and expertise with them, but with the end of fighting and the installation of a democratically-elected government in 2006, several have returned. Liberia has the distinction of having the highest ratio of direct foreign investment to GDP in the world.

Liberia is one of 14 countries that have recorded impressive Human Development Index (HDI) gains of more than 2% annually since 2000, according to the Global Human development report released by UNDP. Countries like Afghanistan, Sierra Leone, Ethiopia, Rwanda, Angola, Timor-Leste, Myanmar, Tanzania, Liberia, Burundi, Mali, Mozambique, Democratic Republic of the Congo and Niger have shown a remarkable change on their HDI.  Between 2007 and 2012 Liberia moved up by 3 points in its rank. The country is now recorded as one of the 14 countries with highest gain in Human Development Index, with an increase of about 2% a year. 

 

History

 For the first time in 73 years, Liberia in 2017 transitioned from one democratically elected government to another with the election of Football Icon George Weah as President and Jewel Taylor as Vice President. (Photo Credit: Executive Mansion)

Liberia is located on the West Coast of Africa with a population of 3.489 million, bordered by Sierra Leone to the west, Cote D’Ivoire on the east, Guinea to the North and the Atlantic Ocean to the South.

Liberia has 579 km of coastline and 111,370 sq. km. land mass with 15 political subdivisions known as Counties namely, Bomi, Bong, Gbarpolu, Grand Bassa, Grand Cape Mount, Grand Gedeh, Grand Kru, Lofa, Margibi, Maryland, Montserrado, Nimba, River Cess, River Gee, Sinoe.

English is the official language with 16 local languages. It has a mixed legal system of common law (based on Anglo-American law) and customary law and an annual rainfall of 4,650mm per year in the coastal areas and 2,240mm in the interior and possesses about 40% of the West Africa’s rainforest.

Christians in Liberia form 85.6% of the population, Muslims 12.2%, Traditional 0.6%, other 0.2%, none 1.4% (2008 Census). Liberia is rich in natural resources, including iron ore, gold, diamonds, timbers and rubber.  Freed slaves from the United States settled in Liberia in 1822.

By 1847, the country declared her independence becoming the first black independent country in Africa where Americo-Liberians were able to establish a republic. Liberia has a Republican form of government with three branches including Legislature, Judiciary and Executive.

 

Challenges

 There are high expectations that the new government will work towards improving the living standards of many Liberians.

In 1980, a military coup led by Samuel Doe ushered in a decade of authoritarian rule. After 142 years of stability and a one party system of government, Liberians experienced violent conflict in December 1989 when Charles Taylor launched a rebellion against Doe's regime that led to a prolonged civil war in which DOE himself was killed.

The crises had immense social, political, and humanitarian implications. The system of governance collapsed resulting in abuses of human rights. A period of relative peace in 1997 allowed for elections that brought TAYLOR to power, but major fighting resumed in 2000.

In August of 2003, the Economic Community of West African States (ECOWAS) led peace talks in Accra, Ghana ended the war and prompted the resignation of former president Charles TAYLOR, who faced war crimes charges in The Hague related to his involvement in Sierra Leone's civil war.

The peace talks culminated in the signing of the Comprehensive Peace Agreement by Liberia’s three warring factions; the Armed Forces of Liberia (GOL), Liberians United for Reconciliation and Democracy (LURD), and the Movement for Reconciliation and Democracy (MODEL).

As a result of the Accra agreement, the National Transitional Government headed by Chairman Charles Gyude Bryant and comprising of a conglomerate of technocrats and actors from different warring factions, was installed.

This marked the launch of a two-year transitional period within which the UN integrated mission, comprised of the United Nations Mission in Liberia (UNMIL) and the various humanitarian agencies, was mandated to stabilize and improve the security and humanitarian situation in Liberia in readiness for the next elections.

By the end of 2004, owing to dedicated efforts by the international community, the security situation was stabilized. After two years of rule by a transitional government, democratic elections in late 2005 brought President Ellen Johnson Sirleaf to power.

This created the basis for the continuing efforts of the international community to rebuild and rehabilitate the country. Refugees and IDPs returned home. Hospitals, schools and roads are undergoing reconstruction, and the government has been making headway in reinstating the rule of law and eradicating corruption. Nevertheless, great challenges still lie ahead before life resumes to normal in Monrovia, Montserrado County, and the remaining 14 counties.

However, international actors and the Liberian government contributed jointly to the smooth conduct of the first post conflict elections in 2005 which paved the way for the first democratic elected woman president of Liberia in person of President Ellen Johnson Sirleaf.

President Ellen Johnson-Sirleaf subsequently won re-election in 2011 in a second round vote that was boycotted by the opposition and remains challenged to build Liberia's economy and reconcile a nation still recovering from 14 years of fighting. Challenges still remain for Liberia which has emerged from the long civil war in West Africa predominated by an emerging young population.

Richly endowed with water, mineral resources, forests, and a climate favorable to agriculture, Liberia had been a producer and exporter of basic products, primarily raw timber and rubber and is reviving those sectors. Local manufacturing, mainly foreign owned, had been small in scope.

The United Nations Security Council in September 2012 passed Resolution 2066 which called for a reduction of UN troops in Liberia by half by 2015 and 2017 witnessed the complete withdrawal of all 4,000 and challenging Liberia's security sector to fill the gaps.

The economy, though recovering, is still unable to generate the large-scale employment opportunities essential for absorbing a large pool of unemployed and underemployed young men and women.

The task of rebuilding the country offers an opportunity to use existing capabilities to contribute to sustainable patterns of social and economic rehabilitation and development.

To top it all, Liberia has yet to recover from severe economic shocks in 2014/15 caused by the Ebola Virus Disease and the collapse in international prices of key export commodities (iron ore, palm oil).

The country reached zeroing growth for the last three years which hit an already vulnerable economic structure, highly dependent on donors assistance and food imports, and with a very low fiscal space that is not foreseen to improve in the  short term.

At the same time, the country is going through multiple transitions, representing a major turning point in the country’s post-war recovery and reconstruction. The transitions have significant implications with regard to UNDP’s role and capacities within the UN system and the wider development in continuing to support Liberia’s development aspirations.

Real GDP growth plunged from 8.7% 2013 to 0.7% 2014, 0.0% in 2015 and negative 0.5% in 2016. Estimates for 2017 FY of 3.2 percent have just been revised by the IMF too 2.5 percent.Off-budget donors assistance under various modalities reach 136 percent of the national budget (which totals US$540m for FY 2017/18.

Liberia depends heavily (up to 80%) on food imports and at the estimated level of cereal production, the cereal import requirement in 2015 was estimated at 445 000 tonnes of cereals, about 24% more than the average of the previous five years Rice import requirements account for about 350 000 tonnes of the total.


Successes

Alt text for sample imageMost Village Loan Associations in Rural Liberia have immensely benefited from Village Savings with the help of the Central Bank of Liberia (Photo:UNDP)

Since 2005, the political situation in Liberia has tremendously improved following the General and Presidential Election that ushered in a democratically elected government in January 2006 headed by President Ellen Johnson-Sirleaf.

The country has held two successful elections with sustained peace and improved governance which is one cardinal reason for improvement in the livelihood and growth that is driving MDGs implementation.

Ellen Johnson-Sirleaf elected in 2005 and again in 2011, a Harvard-trained banker and administrator, has taken steps to reduce corruption, build support from international donors, and encourage private investment. Now that embargos on timber and diamond exports have been lifted, this opens new sources of revenue for the government.

In 2010, Liberia shipped its first major timber exports to Europe and reached its Heavily Indebted Poor Countries initiative completion with nearly $5 billion of international debt permanently eliminated. Liberia's Paris Club creditors also agreed to cancel Liberia's debt as well.  Given this major development, Liberia is now able to establish a sovereign credit rating and issue bonds.

The International Monetary Fund (IMF) has completed the sixth review of Liberia's extended credit facility, bringing total disbursements to over $379 million. Additionally, the African Development Bank approved a grant of $48 million in 2011 to support economic governance and competitiveness.

Rebuilding infrastructure and raising incomes depends on generous financial and technical assistance from donor countries and foreign investment in key sectors, such as infrastructure and power generation. The country has achieved high growth during 2010-12 due to favorable world prices for its commodities.

Since 2006 the Government of Liberia (GoL) has instituted robust reforms that fostered economic recovery and sustained growth which also led to improved performance across all sectors of the economy. Per capita GDP declined from US$524.7 in 1987 to US$54.5 in 1995 during the heat of the civil war. In 2005, the real GDP was US$401.7 million and later grew to US$630.3 million in 2008.

Similarly, RGDP in 2011 increased to US$768.0 million and estimated at US$835.1 million in 2012. Liberia’s post-war annual national budget was recorded at US$80 million in 2006 and has grown to US$572 million in 2012, indicating an increase of 615 percent which has expanded the national fiscal space in support of national development that has strongly driven the MDGs implementation in the short period.

The strong growth over the period was driven by policy reform framework under the Poverty Reduction Strategy (PRS), Lift Liberia (2008-2011) that led to sustained support to the agriculture and the forestry sectors which accounted for 53.0 percent.

These reforms have strengthened the private sector and particularly Liberia’s business sector which has also led to strong growth in the service sector (Poverty Reduction Strategy 2008; National Budget; and Central Bank Annual report 2011).

In managing its resources, Liberia has transitioned its national budget from annual appropriation to medium term expenditure framework (MTEF) with 3 years forecast and appropriation focusing more on investment activities to accelerate development.

Improvements in areas such as access to universal primary education, promoting gender equality and empowering women and reducing child mortality have been the result of deliberate policy actions driven by the Government’s goal to invest in the lives of the people.

The Government has also designed its medium-term economic growth strategy for the next five years (2012-2017), called “Agenda for Transformation”, that is part of Liberia’s long-term development plan (“Vision 2030”), whose objective is to propel the country into the rank of a middle income country by 2030.  

In general, Liberia has made some progress in overcoming the devastating effects of the civil conflict. The administration of former President Sirleaf established policies aimed at fostering economic growth, increase foreign direct investment and promote exchange-rate stability.

The Liberian economy showed solid performance in 2013 with real GDP growth estimated at 8.1%, somewhat lower than the previous year 2012 (8.3%), but still stronger than the 8% growth recorded in 2011 supported by the strong performance of iron-ore production, extractive industries, especially with regard to effective planning, sustainability of resource use and prudent management of revenues. Inflation at the end of September 2013 was 8.2 percent, owing primarily to relatively high international and domestic food prices and the pass-through of the recent exchange rate depreciation. The Liberian dollar depreciated by 7 percent at the end of 2012 to June 2013.

The depreciation pressures also reflect, in part, the rise in Government spending in Liberian dollars by about 38 percent in the first half of 2013, compared with the same period last year. In order to mitigate exchange rate pressures, the Central Bank of Liberia (CBL) stepped up its interventions and increased its sales of foreign exchange through the foreign exchange auction amounting to US$52.3 million in the 6-month period ending June 2013, compared with US$37.1 million for the same period in 2012.

Starting in July 2013, the CBL also issued bills to help manage the Liberian dollar liquidity. Reserves declined to about 2.7 months of imports, lower than the targeted 3 months import cover.

The past government significantly limited fiscal space and had to safeguard priority spending (infrastructure projects), debt repayments coupled with limited domestic borrowing for 2013/2014. Import growth slowed compared with the previous year, due to a drop in rice imports as well as lower investment-related imports. However, export prices for iron ore and rubber production volumes in these sectors remained strong. Also in 2013, the government-imposed a moratorium in the forestry sector halting timber exports.

General elections were held in Liberia on 10 October 2017 to elect the President and House of Representatives. No candidate won a majority in the first round of the presidential vote, so the top two finishers — CDC standard-bearer Amb. George Weah and UP standard-bearer Vice President Joseph Boakai — competed in a run-off on 26 December.

The second round was originally scheduled for 7 November, but was postponed after LP standard-bearer Cllr. Charles Brumskine, in third place, challenged the result in the Supreme Court. The Supreme Court dismissed the challenge, which would have forced a re-run of the first round had it been successful, and the second round was held on 26 December.

Weah emerged victorious with just over 60% of the vote. The elections were overseen by the National Elections Commission (NEC) and were the first elections to be run entirely by the Government of Liberia and security forces since the conclusion of the civil wars in 2003. This was considered a smooth transition of power from one democratically elected government to another in 73 years of Liberia’s history. The new government was inaugurated on January 22, 2018 and has set as its Agenda a Pro-Poor Governnance System.  

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