By James T. Brooks
Liberia’s economy is currently defined by a paradox of promising growth projections set against the backdrop of persistent structural weaknesses and widespread public hardship. While official figures project robust economic expansion, the daily reality for the average Liberian remains a challenging struggle with high prices and insufficient basic services.
The economic outlook for Liberia is optimistic on paper, driven largely by performance in key primary sectors.
Projected GDP Growth: Real GDP growth is projected to accelerate in 2025, with forecasts ranging from 4.6% to 5.6%, up from the 4.8% recorded in 2024. This growth is expected to be broad-based.
Sectoral Drivers: The primary growth engines are the mining sector (fueled by gold and iron ore) and agriculture and fisheries (driven by rubber and rice output). The services sector also remains the largest contributor to GDP.
Fiscal Improvement: The government has reported stronger-than-projected tax revenue collection, contributing to a narrower fiscal deficit and improved debt management compared to previous years. This fiscal discipline is a key recommendation from international partners like the IMF and World Bank.
ARREST Agenda Focus: President Joseph Boakai’s ARREST Agenda (Agriculture, Roads, Rule of Law, Education, Sanitation, and Tourism) is the current national development blueprint (2025-2029). By prioritizing Agriculture and Roads, the agenda aims to tackle food insecurity, reduce high transportation costs, and unlock the economic potential of the interior regions.
Despite the positive statistics, the economic recovery remains fragile and faces significant threats that prevent growth from translating into tangible improvements for most citizens.
While inflation has shown signs of easing from the high rates earlier in the year, averaging around 8.2 to 10.7% (depending on the source), the public’s sentiment is one of growing hardship. The prices of essential commodities—rice, fuel, and building materials—remain elevated. This indicates that macroeconomic gains, such as a stable exchange rate and lower global commodity prices, are not proportionally translating into lower consumer prices, creating a painful disconnect between GDP growth and everyday life.
Liberia’s underdeveloped infrastructure is arguably the single largest constraint on sustainable growth and job creation.
Road Networks: Poor road networks inflate the cost of doing business, hinder agricultural trade, and make healthcare and education inaccessible in many rural areas.
Electricity: Expensive and unreliable electricity supply remains a major obstacle to the manufacturing sector, stifling industrialization and increasing operational costs for businesses.
Corruption, a weak judicial system, and a lack of transparency in contract awards continue to deter Foreign Direct Investment (FDI). Foreign investors frequently cite an unpredictable business environment and institutional bottlenecks as major risks, limiting job creation and private sector expansion outside of the natural resource enclaves.
Public debt remains a significant pressure point, with debt service costs mounting. While the debt-to-GDP ratio is projected to decline slightly, the cost of servicing these obligations still consumes a large portion of the national budget, potentially squeezing resources needed for critical social spending on health and education.
For Liberia to transition from a low-income country with potential to a stable, emerging economy, the government must ensure that its policy successes trickle down to the street level.
Accelerate ARREST Implementation: The success of the ARREST Agenda hinges on translating its strategic pillars into verifiable projects, particularly road construction and investments in local agriculture, which can directly impact prices and rural livelihoods.
Focus on Structural Reforms: Beyond fiscal consolidation, the administration must show concrete progress in governance and anti-corruption measures to improve the business climate and attract responsible private sector investment.
Address the Cost of Living: Targeted interventions are needed to break up supply chain bottlenecks and market monopolies that keep the prices of basic goods artificially high, regardless of falling inflation.
Liberia is on a path of recovery, supported by a commodity boom and renewed fiscal discipline. However, until the growth on paper is matched by the reality of prosperity in the markets, on the farms, and in the homes of ordinary citizens, the challenge of inclusive development will persist. The next few years will be critical in determining if the current economic trajectory can truly be a transformative one.