—World Bank Warns; launches Liberia Country Economic Memorandum, titled “Escaping the Natural Resource Trap: Pathways to Sustainable Growth and Economic Diversification in Liberia.”
The World Bank Group has issued a strong call for bold reforms to drive economic transformation in Liberia, warning that the next five years will be decisive in shaping the country’s long-term economic future.
The warning came on Tuesday, March 11, during the official launch of Liberia Country Economic Memorandum (CEM), titled “Escaping the Natural Resource Trap: Pathways to Sustainable Growth and Economic Diversification in Liberia.”
The report provides an in-depth analysis of Liberia’s economic outlook and examines how the country’s vulnerability to external shocks has influenced its sustainable growth and development. Its insights can help to inform strong delivery on the ARREST Agenda for Inclusive Development (AAID).
According to the World Bank report, Liberia faces the challenge of a “natural resource trap” whereby a narrow, commodity-based development model has led to repeated cycles of stagnation and recovery. The country remains vulnerable to shocks due to weak drivers of long-term prosperity, such as human capital, wealth accumulation, and productivity, which has undermined the country’s economic growth potential.
The study finds that a “business-as-usual” scenario would yield modest growth, insufficient for achieving middle-income status by 2030 and substantially reducing poverty. Real per capita GDP will grow modestly, and Liberia will not reach the middle-income threshold of US$1,000 until around 2050.
However, speaking at the launch, Georgia Wallen, the World Bank Country Manager for Liberia, stressed that without ambitious policy changes, Liberia risks remaining trapped in a cycle of low growth and heavy reliance on natural resource exports.
“These next five years will be decisive for shaping Liberia’s longer-term economic outlook,” Wallen emphasized. “Sustainable, inclusive high growth will require strong policy action – and a whole-of-Government approach backed by strong commitment and accountability for results.”
The CEM, produced every five years, is one of the most detailed analytical reports on Liberia’s economy. It examines the country’s economic trajectory while drawing lessons from peer nations such as Ghana, Sierra Leone, Guinea, and Senegal.
According to Wallen, the report aims to guide policymakers, academics, and other stakeholders in making informed decisions to accelerate Liberia’s economic progress.
“We hope this report will be a tool for policymakers, academia, students, think tanks, and interested Liberians – at home and abroad – to gain insights that can spur action,” she noted.
The launch of the report aligns with Liberia’s new national development strategy, the Agenda for Accelerated Inclusive Development (AAID), which aims to increase the incomes of Liberians by 25% over the next five years.
“Liberia’s new national development plan for 2025–2029 aims to lift the incomes of Liberians by around 25% in five years – a bold aspiration,” Wallen said. “But the AAID’s aims actually go far deeper. Ultimately, the AAID is attempting to ‘reset’ Liberia’s development model – from ‘resource export’ to emphasizing ‘sustainable value addition, processing, and innovations.’”
The World Bank report identifies five critical economic transitions needed to unlock Liberia’s growth potential. These include improving public expenditure management, increasing domestic revenue mobilization, and reducing overreliance on extractive industries.
The CEM makes it clear that maintaining the status quo will not deliver the economic transformation Liberia needs. Without significant policy reforms, the report projects only modest economic growth—insufficient for the country to achieve middle-income status by 2030 or significantly reduce poverty.
“The report finds that a ‘business-as-usual’ scenario would yield only modest growth that is insufficient for achieving middle-income status by 2030 and substantially reducing poverty,” Wallen warned.
In contrast, the report argues that a high-ambition reform agenda could deliver transformative outcomes, including better jobs and improved living standards across Liberia.
“With ambitious reform, Liberia could attain lower middle-income status before 2040, with improved jobs and a better quality of life for Liberians nationwide,” Wallen asserted.
The report draws lessons from comparator countries, highlighting how targeted reforms have enabled other nations in the region to escape similar economic traps.
Wallen outlined a phased approach to reforms, beginning with short-term measures such as strengthening public finance management and increasing domestic revenue. Over the medium and long term, the focus must shift to diversifying the economy beyond mining and fostering private-sector growth.
“In today’s session, you’ll hear about short-term, medium-term, and longer-term policy actions needed to stimulate true transformation,” she said. “This ranges from boosting domestic revenue mobilization and enhancing public expenditure management in the short run, to diversifying away from an excessive reliance on mining over the medium and long term.”
The report underscores the importance of a coordinated, government-wide approach to achieve these goals. Without such efforts, the country risks falling further behind its regional peers.
The World Bank reaffirmed its commitment to supporting Liberia’s economic transformation, aligning its efforts with the AAID and the forthcoming World Bank Group Country Partnership Framework, which is currently in advanced stages of preparation.
“As Liberia’s longstanding development partner, the World Bank Group stands ready to support Liberia’s ‘reset’ and the ambitious strategic re-orientation reflected in the AAID,” Wallen stated.
She concluded her remarks with a message of optimism, expressing confidence in Liberia’s ability to achieve meaningful economic transformation if the right policies are adopted and implemented.
“We believe in the future of Liberia because we believe in the people of Liberia,” Wallen said. “We hope today’s session will inspire action and stimulate informed dialogue.”
The launch event brought together government officials, development partners, and leaders from Liberia’s academic and business communities.
