Economy of Liberia

Much of independent Liberia's economic history is subject to limited archival documentation, making it hard for economic historians to make comprehensive assessments about the nature of Liberia's economy over time.[14] The Liberian government only began producing GDP per capita data in 1964.[14]

A 2022 study by LSE economic historian Leigh A. Gardner assessed that Liberian GDP per capita was $430 in 1945, which was just above subsistence and approximately half of Japan's GDP per capita at the time.[14] It rose to approximately $500 by the time of independence, but the economy subsequently stagnated until the 1930s when a period of rapid economic growth began.[14] Whereas Liberia had been poorer than Ghana during the 19th and early 20th centuries, it caught up with Ghana in 1950 and subsequently diverged considerably, becoming almost twice as wealthy as Ghana by 1970.[14] Throughout the 1970s, the Liberian economy stagnated.[14]

In 1926, the Liberian government gave the Firestone Tire company the right to lease up to 1 million acres of land for 99 years at a cost of 6 cents per acre.[15] Firestone developed an inordinate sway over the Liberian government, effectively acquiring control over its finances in the subsequent period.[15] The company was an important source of foreign investment into Liberia during this period.[15] Firestone then set about establishing rubber tree plantations of the non-native South American rubber tree, Hevea brasiliensis in the country. By the 1950s, the company was Liberia's largest private employer and also its largest exporter.[16] Vincent Browne wrote in 1955 that rubber accounted for more than $45,000,000 of Liberia's approximately $55,000,000 worth of exports.[15] Liberia became one of the largest rubber exporters in the world in the post-World War II period.[15] Today, Firestone's rubber plantation in Liberia is the world's largest contiguous rubber plantation, operated by the Firestone (now Bridgestone) subsidiary, the Firestone Natural Rubber Company.

In the 1940s, Liberia become one of the largest recipients of American aid. US aid to Liberia began with the Lend-Lease program of 1942.[17] The aid per capita received by Liberia was comparable to that obtained by countries such as Korea and Marshall Aid recipients like the United Kingdom.[17] Economic historian George Dalton estimated in 1965 that Liberia received more aid per capita from the United States than any other African country.[18]

In the post-WWII period, Liberia tried to become a destination for offshore services, as the country loosened laws related to ship registration, corporation, and taxes.[19] The Liberian shipping registry was highly successful as Liberia had by the 1960s become the largest ship registry in the world in terms of tonnage.[19]

The Liberian economy had relied heavily on the mining of iron ore prior to the civil war. Liberia was a major exporter of iron ore on the world market. By the 1970s, iron mining accounted for more than half of Liberia's export earnings. Since the coup d'état of 1980, the country's economic growth rate has slowed down because of a decline in the demand for iron ore on the world market and political upheavals in Liberia.

Upon the end of the war in 2003, GDP growth began to accelerate again, reaching a peak of 9.4% in 2007.[20] The global financial crisis slowed GDP growth to 4.6% in 2009,[20] though a strengthening agricultural sector led by rubber and timber exports increased growth to 5.1% in 2010 and an expected 7.3% in 2011, making the economy one of the 20 fastest growing in the world.[21][22]

In March 2010, Bob Johnson, founder of BET, funded the first hotel constructed in Liberia in 20 years. The 13-acre (53,000 m²) luxury resort was built in the Paynesville section of Monrovia.[23]

Liberia's external debt was estimated in 2006 at approximately $4.5 billion, 800% of GDP.[24] As a result of bilateral, multilateral and commercial debt relief from 2007 to 2010, the country's external debt fell to $222.9 million by 2011.[25]

Boy grinding sugar cane 1968

Liberia's business sector is largely controlled by foreigners mainly of Levantine (primarily Lebanese) and Indian descent. There also are limited numbers of Chinese people engaged in agriculture. The largest timber concession, Oriental Timber Corporation (OTC), is Indonesian owned. There also are significant numbers of West Africais engaged in cross-border trade. Legal monopolies are possible; for example, Cemenco holds a monopoly on cement production.

Shipping flag of convenience

A proportional representation of Liberian exports. The shipping related categories reflect Liberia's status as an international flag of convenience - there are 3,500 vessels registered under Liberia's flag accounting for 11% of ships worldwide.[32][33]

Liberia maintains an open maritime registry, meaning that owners of ships can register their vessels as Liberian with relatively few restrictions. This has meant that Liberian ship registration is usually understood as the employment of a flag of convenience. Liberia has the second-largest maritime registry in the world behind Panama, with 4,300 vessels registered under its flag accounting for 12% of ships worldwide.[32][33] This includes 35% of the world's tanker fleet. Liberia earned more than $18 million from its maritime program in 2000.

Liberia is a member of the Economic Community of West African States (ECOWAS). With Guinea and Sierra Leone, it formed the Mano River Union (MRU) for development and the promotion of regional economic integration. The MRU became all but defunct because of the Liberian civil war which spilled over into neighboring Sierra Leone and Guinea.

• Central Bank of Liberia
• Transport in Liberia
• Tourism in Liberia
• Firestone Natural Rubber Company
• United Nations Economic Commission for Africa

• 68% of Liberians live in poverty census reveals
• Economy of Liberia at Curlie
• Mineral resources of Liberia
• Liberia latest trade data on ITC Trade Map
• Liberia profile - World Bank