By: Varney Dukuly
MONROVIA: The United States Department of State has released its 2023 Investment Climate Report on Liberia, highlighting that Liberia is far from attaining pre-war level development because corruption mis-governance continues to hinder growth, investment, and job creation.
However, when this paper contacted the Government of Liberia (GOL), through the Minister of Information, Legerhood J. Rennie, for the government’s reaction to said report, Minister Rennie said: “We are not aware of any report and we have not seen any report. If we see the report and are aware, we will respond as a government.”
When reminded that the report has been out in the public, Minister Rennie maintains that the government was not aware and declined to accept a link or copy of the report as suggested by our reporter for verification.
“What do you want me say, we are not aware. You don’t have to share any report with me. If we see it, the government will respond,” said Minister Rennie in a telephone interview with The ‘Investigative’ INDEPENDENT(TI).
However, a prominent businessman who prefers anonymity for fear of reprisal criticized Minister Rennie’s response concerning the report.
“Reading Minister Rennie’s statement from the short interview,” the businessman added, “it is like encountering a visitor from another planet.”
Interestingly, the US 2023 Investment Climate Report on Liberia indicates that Liberia’s largely commodities based economy relies heavily on imports even for most basic needs like fuel, clothing, and rice–the country’s staple food.
Report: “The COVID-19 pandemic disrupted many sectors of the economy, which contracted in 2019 and 2020. However, the World Bank and International Monetary Fund (IMF) expect per capita GDP to return to pre-COVID levels by 2023.”
In added that the World Bank’s latest report shows Liberia’s GDP per capita was US$676 in 2021 compared to US$700 before the outbreak of the pandemic in 2019.
But the World Bank report can sound hollow to most Liberians who lack reliable power, although efforts to expand access to the electricity grid are ongoing through an extension from Mount Coffee Hydropower Plant, connection to the West Africa Power Pool.
“Low human development indicators, expensive and unreliable electricity, poor roads, a lack of reliable internet access (especially outside urban areas), and pervasive government corruption constrain investment and development,” stressed the U.S. Investment Climate statement.
It maintains that public perception of corruption in the public sector is high as reflected in Transparency International’s 2022 Corruption Perception Index.
“Low public trust in the banking sector and lack of access to business financing result in most cash being held outside of banks,” the Investment Climate Report added.
To remedy this, the report highlighted that in 2022, the Central Bank of Liberia (CBL), began printing and circulating additional currency. This, it says, will continue through 2024, when the CBL expects to have distributed LD$48 billion new Liberian dollars.
According to the report, the government “has yet to activate its long-planned National Electronic Payment System (NEPS, aka ‘the National Switch,’) meaning banking instruments like ATMs and mobile money accounts remain unintegrated and are not interoperable.”
Despite these challenges, Liberia is rich in natural resources. “It has large expanses of potentially productive agricultural land and abundant rainfall to sustain agribusinesses,” said the report.
“While vast mineral resources offer significant potential to investors in extractive industries, a few large international concessionaires have invested successfully in agriculture and mining.”
But, negotiating these agreements with the government, according to the U.S. government report, “often proves to be a lengthy, politicized, and byzantine struggle for those companies who do not pay bribes.”
Report: “The fishing industry, long dormant compared to pre-war levels, is a potential source of investment, but is struggling to make necessary improvements to meet standards and economies of scale that would open global export markets.”
According to the report, in the face of government strategies toward foreign investment, in practice, it does much to discourage investors and investment in Liberia.
“Some business leaders report it is difficult even to meet with government representatives to discuss new investment or policies damaging to the business climate unless bribes are offered. A weak legal and regulatory framework, lack of transparency in contract awards, and widespread corruption inhibit foreign direct investment,” the report further said.
Interestingly, the U.S. State Department indicated that government officials view foreign investors as opportunities for short-term graft rather than as partners in creating long-term growth, the benefit of the country.
“Many businesses find it easy to operate illegally if the right political interests are being paid, whereas those that try to follow the rules at best find that they receive little if any assistance from government agencies, and at worst, are targeted by government officials seeking direct or indirect bribes or other unofficial payments,” the report further asserted.
