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Economy of Liberia
Currency Liberian dollar (LRD)
Fiscal year 1 January - 31 December
Trade organizations ECOWAS, MRU, WAMZ
Statistics
GDP $1.532 billion (2008 est.)
GDP growth 7.5% (2008 est.)
GDP per capita $500 (2008 est.)
GDP by sector agriculture: 76.9% industry: 5.4% services: 17.7% (2002 est.)
Inflation (CPI) 11.2% (2007 Period average)
Labor force
by occupation
agriculture 70%, industry 8%, services 22% (2000)
Unemployment 85% (2003)
Main industries rubber processing, palm oil processing, timber, diamonds
External
Exports $1.197 billion (2006)
Export goods rubber, timber, iron, diamonds, cocoa, coffee
Main export partners Malaysia, 27.5%, Poland, 18.5%, Germany, 11.5%, United States, 10.5%, Spain, 8.2%, Norway, 5.5% (2007)
Imports $7.143 billion (2006)
Import goods fuels, chemicals, machinery, transportation equipment, manufactured goods, foodstuffs
Main import partners South Korea, 31.4%, Singapore, 22.1%, Japan, 14.9%, China, 10.1% (2007)
Public finances
Public debt external: $3.2 billion (2005 est.)
Economic aid recipient: International multi-billion dollar debt relief and development aid
Main data source: CIA World Fact Book
All values, unless otherwise stated, are in US dollars

The Liberian Civil War in 1989-96 destroyed much of Liberia's economy, especially the infrastructure in and around Monrovia. Many businessmen fled the country, taking capital and expertise with them. Some returned during 1997. Many will not return. Richly endowed with water, mineral resources, forests, and a climate favorable to agriculture, Liberia had been a producer and exporter of basic products, while local manufacturing, mainly foreign owned, had been small in scope. The democratically elected government, installed in August 1997, inherited massive international debts and currently relies on revenues from its maritime registry to provide the bulk of its foreign exchange earnings. The restoration of the infrastructure and the raising of incomes in this ravaged economy depend on the implementation of sound macro- and micro-economic policies of the new government, including the encouragement of foreign investment.

Contents

Summary

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 conclusion of fighting and the installation of a democratically-elected government in 2006, some have returned. 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. Local manufacturing, mainly foreign owned, had been small in scope. President Ellen Johnson-Sirleaf, a Harvard-trained banker and administrator, has taken steps to reduce corruption, build support from international donors, and encourage private investment. Embargoes on timber and diamond exports have been lifted, opening new sources of revenue for the government. The reconstruction of infrastructure and the raising of incomes in this ravaged economy will largely depend on generous financial and technical assistance from donor countries and foreign investment in key sectors, such as infrastructure and power generation.

Republic of Liberia
Liberia court of arms.png

History · Politics · Demographics
Culture · Geography · Music
Communications · Transport · Economy
Armed Forces · Foreign relations
Americo-Liberian · Nationality law
Subdivisions: Counties · Districts

In greater depth

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. In the 1970s and 1980s, 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. Liberia's foreign debt amounts to more than $3 billion.

Timber and rubber are Liberia's main export items since the end of the war. Liberia earns more than $100 million and more than $70 million annually from timber and rubber exports, respectively. Alluvial diamond and gold mining activities also account for some economic activity.

Being the second-largest maritime licenser in the world with more than 1,700 vessels registered under its flag, including 35% of the world's tanker fleet, Liberia earned more than $18 million from its maritime program in 2000. The Liberian Government has declared in recent months that it has discovered sizable amounts of crude oil along its Atlantic coast.

Boy grinding sugar cane 1968

Liberia's business sector is largely controlled by foreigners mainly of Lebanese and Indian descent. There also are limited numbers of Chinese engaged in agriculture. The largest timber concession, Oriental Timber Corporation (OTC), is Indonesian owned. There also are significant numbers of West Africans engaged in cross-border trade.

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.

Liberia has relied heavily on vast amounts of foreign assistance, particularly from the United States, Japan, Britain, France, Italy, Germany, the People's Republic of China, and Romania. But because of the Liberian Government's perceived disregard for human rights, foreign assistance to Liberia has declined drastically. The Republic of China (Taiwan) and Libya are currently the largest donors of direct financial aid to the Liberian Government. However, significant amounts of aid continue to come in from Western countries through international aid agencies and non-governmental organizations, avoiding direct aid to the government.

The United Nations imposed sanctions on Liberia in May 2001 for its support to the rebels of the Revolutionary United Front (RUF) in neighboring Sierra Leone.

See also

References

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