LIBERIA

President George Weah’s administration has continued to come under heavy local and international criticism for its mismanagement of the economy that has included a massive cash crunch, a sharp decline in GDP that has reduced Liberia’s ability to borrow, and continued allegations of political corruption. Voters inflicted a serious setback on the ruling party in the senatorial vote held in late 2020. Concerns that President Weah may use a new constitution approved by referendum in 2020 to seek a third term beyond 2023 are well-founded. The mismanagement of the economy poses the primary threat to country risk, as well as to the country’s ability to bounce back from COVID-19. Moreover, investment from the private sector is waning as confidence in the government’s ability remains weak and concerns over corruption grow.

• President George Weah raised high hopes in 2018 by coming to power in this West African country still marked by the civil war of 1989-2003 and the Ebola epidemic of 2014-2016. However, he has failed to turn the economy around and enthusiasm has given way to disenchantment. The government performed poorly in the 2020 senatorial elections, when the opposition won 15 out of 30 senate seats, including Montserrado County, the most populous county in the country, which includes the capital Monrovia. It is highly likely that anti-government protests and civil servant strikes will mount over the next year and destabilise the government. However, Weah seems to be cementing his power and he may seek to interpret a new constitution to remain in power beyond 2023.
• Rising anti-government sentiment has manifested in the form of protests and strikes since 2018. President Weah’s administration has also come under increasing criticism for seemingly undemocratic acts. Despite these economic and political challenges, the local security situation remains largely stable as grievances are more likely to manifest in the form of unrest. The participation of Liberia in regional peacekeeping efforts is a major turnaround for the historically war-torn country and is indicative of its broad return to peace. However, Liberia’s participation in this initiative also raises the risk of reprisal attacks by Islamist militant groups, although the likelihood remains low due to a lack of support for such groups in the country. Rebel groups pose a secondary threat, particularly along the border in Grand Gedeh and Nimba counties, where armed gangs have been known to launch sporadic attacks.
• Macroeconomic conditions in Liberia were already challenging prior to the arrival of the pandemic with the country entering a four-year Extended Credit Facility arrangement with the IMF in December 2019. Economic contraction along with adherence to the IMF programme has resulted in additional grievances, as the government has been instructed to implement cuts to its wage bill. Mining may see a boost as iron ore prices recover, although agricultural exports remain badly hit. The banking sector also remains highly vulnerable, particularly as some banks were already facing US dollar liquidity shortages prior to the pandemic. Net foreign direct investment has dropped since 2018.