NS4301 Summer 2015 Liberia

Overview State Building American Colonization Societies Independence proclamation (1847) Post-independence Challenges Borders consolidation, Revenue shortages, Coastal & Hinterlands disconnection First Overture to Global Economy Firestone Concession (1926) WWII Economy Growth without Development ( ) Conflict Economy ( ) Post-Conflict Statistics & Challenges Country Statistics Ebola effects Future Prospects

Liberian Political and Economic History 3

Coastal Colonies 4 American Colonization Society (ACS) UK/US Anti Slave Trade Act (1807) Economy Coastal Hinterland

5 Independence (1847) Liberia Administrative Map State Formation Challenges: Border consolidation Insolvency Coastal/Hinterlands

Firestone Colony ( ) Iron Ore Discovery (1951) Africa’s first and the world’s third largest exporter of iron ore William Tubman’s Open-door politics ( ) Lend/Lease Act – U.S. Built $22 million free port of Monrovia (two other modern ports constructed in that era) Port and road development – connected the hinterlands Basing of US Military Forces Four-Point Program (1949): Liberia applied for and received $40 million for public construction Growth without Development 6

Tubmanomics continues 38 major foreign concerns representing a combined investment of nearly $750 mil under Tubman Government receives 50% of economy of extraction profit Citizens could buy shares in the various companies below market price GDI more than quadrupled between 1950 and 1961 Money in / Money out Tubman’s Open-Door Policy has equally provided a cover for the almost total control of Liberia's commercial activity by Lebanese merchants in the wholesale and retail trade. 7 Growth without Development (cont.)

Cold War/Civil War Economics William Tolbert’s Political Divergent (1971) East-West pendulum Year of Ferment and Rice Riots (1979) Samuel Doe (1980) First Indigenous Head of State Start of Economic Decline ECOMOG Civil Wars ( ) UN Economic Sanctions Civil War Economics (French Logging Concession, Conflict Diamond) 8

Relative Economic Decline 9

Conflict GDP and GDP Per Capita 10

Current Socio-Economic Data Population: 4.1 million (July 2015 est.) 43% from 0-14 yrs Growth rate: 2.47% Life expectancy: 58.6 yrs More than 28 distinct ethnic groups Literacy Rate: 47.6% Male 62.4% Female 32.8% Heavily Urbanized: 49.7% Annual rate of change: 3.36% 11 Export: $486 mil (1979) $10mil (2004 ) External Debt: $4.5bil ( ) $ mil (current) Rice production fell 73% between ( ) 54% of business operating costs are attributable to energy (2012)

Liberian Demographics Population: 4.1 million (July 2015 est.) 43% from 0-14 yrs Growth rate: 2.47% Life expectancy: 58.6 yrs Literacy Rate: 47.6% Male 62.4% Female 32.8% Heavily Urbanized: 49.7% Annual rate of change: 3.36% More than 28 distinct ethnic groups in Liberia 12 Source: CIA World Factbook

Post Conflict Economy and Human Development 13

Limits to Economic Development: Vulnerable Economic Foundations 14 Source: 2015 Economic Stabilization and Recovery Plan

Limits to Economic Development: Ease of Doing Business 15 Source: World Bank

Limits to Economic Development: Economic Freedom 16 Source: Heritage.org 2015 World Economic Freedom

Limits to Economic Development: Global Competitiveness 17 Source: World Economic Forum, 2015 Africa Competitiven ess Report

Costs of Ebola 18 Source: 2015 Economic Stabilization and Recovery Plan

Costs of Ebola 19 Revised GDP Figures by Sector Source: 2015 Economic Stabilization and Recovery Plan

Costs of Ebola 20 Source: 2015 Economic Stabilization and Recovery Plan

Human Development Challenges Human Development Index Large Youth Bulge Education: Mean years: 3.93 Adult literacy 42.9% Health Infrastructure:.01 physicians/1,000 people 21 Source: UNDP HDI Data

Legatum Prosperity Index 22

Voice and Accountability

Political Stability

Government Effectiveness

Regulatory Quality

Rule of Law

Control of Corruption

Future Prospects 29

Pre-Ebola Development Plan Agenda for Transformation (AfT) and Liberia Rising 2030 Revitalize traditional economic sectors Minister Amara M. Konneh 30

Source: 2015 Economic Stabilization and Recovery Plan 2015 Economic Stabilization and Recovery Plan Three Part Plan (cost of 812 million USD) : Recover Output and Growth Focus on farmers Diversify throughout the value chain Finance delayed projects due to Ebola crisis Strengthen Resilience and Reduce Vulnerability Implement a 7-year Health Investment Plan Improve education at all levels Implement Water and Sanitation Expansion Plan Strengthen cash payments to Ebola victims Invest in Security Sector Strengthening Public Finances and Ensure Delivery Replace current budge shortfalls De-concentrate public services across all 15 counties Reform Civil Service priorities and pay rationalization 31

GDP Forecast 32

Questions? 33