Industrialization and Global Value Chains in Liberia

Aug 4, 2014 | Afribiz
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Liberia has participated in global value chains for decades through its export of primary commodities, and the revitalization of this sector after the war has been a key driver of economic growth. Exports have been dominated by three commodities – iron ore, rubber and timber – that accounted for more than 80% of exports and an estimated 22% of GDP in 2013. These shares should increase by 2015 as iron ore production increases. Much of Liberia’s commodity exports were interrupted during the conflict, and since the end of the war, the government has awarded concession contracts in iron ore, rubber, timber and palm oil to revive growth, achieving more than USD 16 billion in FDI commitments. Iron ore production re-started in late 2011 with one mine (Arcelor Mittal) beginning exports, while other mines will commence production between 2014 and 2015. Timber exports were banned by United Nations sanctions from 2003 to 2006. Logging re-started in 2008 and exports picked up considerably from 2011 to 2012, but plummeted in 2013 after fraud and abuse related to logging permits resulted in a moratorium. Rubber production and exports, led by the Firestone plantation, continued during the conflict. Since the end of the conflict, several oil palm plantations have also begun planting, although the process has slowed due to disputes with local populations regarding prior consultation and land access.