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Liberia Infrastructure and Inclusive Growth THE AFRICAN DEVELOPMENT BANK GROUP This report has been prepared by the African Development Bank (AfDB) Group. Designations employed in this publication do not imply the expression of any opinion on the part of the institution concerning the legal status of any country, or the limitation of its frontier. While efforts have been made to present reliable information, the AfDB accepts no responsibility whatsoever for any consequences of its use. Vice President: Zondo Sakala Regional Director: Franck Perrault Chief Country Economist (at the time): Stefan Muller Senior Country Economist: Patrick Hettinger Resident Representative: Margaret Kilo Consultants: Andy Dijkerman, Emmanuel Akpa Copyright 2013 - AFRICAN DEVELOPMENT BANK GROUP Photo Credits: AfDB photo files, Graham Prentice, United Nations Liberia Office, Map of Liberia courtesy of Nations Online Project. PUBLISHED BY Temporary Relocation Agency (TRA) B.P. 323-1002 Tunis Belvedere, Tunisia Tel: (216) 7110-2876 Fax: (216) 7110-3779 Website: www.afdb.org Foreword he African Development Bank views poor and the related infrastructure investment priorities that infrastructure as a critical barrier to reducing can best bring Liberia out of its relative isolation. These T poverty and accelerating growth on the continent. will enable Liberia to play a larger role on an agricultural Concurrently, African leaders increasingly realize the trading stage within the Mano River Union, on a regional advantages of regional cooperation and countries are stage within the ECOWAS energy, communications and placing greater emphasis on accelerating integration transit trade markets and on a globally competitive stage through policies and infrastructure. However, countries as an attractive investment destination for manufacturing, recovering from prolonged periods of conflict or troubled mining and agro-industry. The ultimate objective of the governance face added challenges and this is especially Report is to offer recommendations for short, medium the case when multiple recovering states share the same and long-term infrastructure planning for Liberia. The geographic neighborhood. Fragility renders countries approach takes its cue from Liberia’s national poverty inherently more vulnerable to threats and more focused reduction strategy, the Agenda for Transformation which upon domestic reconstruction as a consequence. seeks inclusive economic growth and it adds a regional perspective on relevant infrastructure development. This fits into the context of the AfDB’s Strategy for 2013 to 2022, which aims to broaden and deepen the The approach to planning seeks to prioritize continent’s process of transformation, mainly by ensuring infrastructure investments that maximize the benefits that growth is shared and not isolated. Moreover, the of internal integration and national stability in the Strategy prioritizes regional integration, which is essential near term, while identifying priority investments that for Africa to realize its full growth potential, to participate will maximize the benefits of regional integration for in the global economy and to share the benefits of an Liberia over the longer term. Together, these outcomes increasingly connected global marketplace. Finally, the will contribute in turn to regional stability. Important Strategy also emphasizes that fragile states require aspects of stability that are addressed include youth support tailored for their unique needs. employment, inclusive approaches to natural resource concessioning and improvements in land tenure for As part of its broader development effort to contribute smallholders, measures to reduce food insecurity and to the integration of Africa, the AfDB Group is leading a improved penetration of services into the hinterland. IN LIBERIA INFRASTRUCTURE AND INCLUSIVE GROWTH new initiative to boost regional integration in West Africa Many of these challenges can be better tackled i focused on Guinea (Conakry), Guinea-Bissau, Liberia and mitigated on a more enduring basis if they are and Sierra Leone. These fragile and post-conflict states addressed through synchronized national and regional lag behind the rest of ECOWAS in terms of social and initiatives. economic development and require attentive assistance in addressing their collective infrastructure gap. By Studies have shown that increasing the stock of assessing and addressing the infrastructure gap, the infrastructure adds to growth and the gross domestic Bank aims to help these nations transition out of fragility product. In countries with severe infrastructure deficits, and into stability. the economic return from infrastructure investment is even more favorable. Improved infrastructure is The present report focused upon Liberia provides a precondition for accelerated development of the a synopsis of a longer study which is one of a series domestic private sector and is a key requirement for the on fragile West African states. Infrastructure in Liberia expansion of intra-regional trade, the benefit of which will suffered badly from its fourteen years of conflict, and improve regional food security over time and build the the nation’s stock of infrastructure remains inadequate region’s trading capacity and ability to compete in world and poorly maintained. There are, however, a number of markets. In recognition of these facts, the development opportunities to reverse this trend, especially if regional of Africa’s infrastructure and economic integration are options are included. Regional integration is examined key components of the strategic direction pursued by in the context of promising domestic growth strategies the Bank. This study is important for three reasons. First, it and neighboring states, both in the context of the Mano provides the Government, the donor community River Union and in the context of ECOWAS. and the private sector with a detailed assessment of infrastructure investment opportunities in Liberia. In these many ways, this Report can contribute to the It provides an advocacy document with which the sustained recovery and acceleration of development Government of Liberia can encourage and enlist the progress in Liberia. support of stakeholders and development partners on a way forward. Second, the Report sensitizes readers to the particular challenges of achieving transformational growth—an outcome that can better be achieved through strategic prioritization of infrastructure that involves Liberian nationals in service delivery and includes the broader Liberian population within the domestic and regional growth opportunities at large. Zondo Sakala This inclusion is vital to securing Liberia’s stability for Vice President the long term future. Finally, it can serve as the catalyst Country and Regional Programs and Policy for accelerated dialogue on integration between Liberia African Development Bank Group INFRASTRUCTURE AND INCLUSIVE GROWTH IN LIBERIA INFRASTRUCTURE AND INCLUSIVE GROWTH ii Preface iberia’s new poverty reduction strategy, the planning that, together with accompanying measures, will Agenda for Transformation recognizes that help unleash the potential of promising growth sectors in L economic growth and development cannot be the Liberian economy. The full report is available online at achieved without adequate infrastructure. At the same http://www.afdb.org/en/countries/liberia. time, key insights from the nation’s history indicate that the social and economic benefits of growth must be This report was prepared on the basis of broad inclusive and an enclave orientation must be minimized stakeholder participation and consultation. This involved to avoid growth without development. Infrastructure numerous rounds of interview and consultations with investment must therefore be planned to support key Liberian Government officials and key stakeholders growth corridors that connect urban centers with during the course of 2012, culminating in a consultative the rural milieu and foster conditions for economic workshop to forge a consensus on priorities and actions advancement by smallholders and the domestic private held in Monrovia in December 2012. This report marks the sector as well as foreign direct investors. Infrastructure beginning of a new initiative—one which seeks to engage services must strive to improve quality, availability and the MRU countries in a new era of accelerated regional affordability to citizens throughout the country. integration and associated infrastructure development. Zondo Sakala This report provides an assessment of the current status The African Development Bank looks forward to Vice President of infrastructure and services in the transport, electric continued dialogue to develop sound new approaches Country and Regional Programs and Policy power, ICT, water and sanitation sectors in Liberia, to investing in infrastructure through means that bolster African Development Bank Group together with the context of their participation in regional national stability and improve Liberia’s integration and infrastructure development initiatives in the Mano River prosperity in the region. Union and ECOWAS. The report is divided into three chapters. Chapter one presents a diagnostic of the present situation including an analysis of determinants of past conflict and continuing vulnerabilities, indicators of social and economic performance, the status of infrastructure and the strategic policies guiding the nation. Chapter IN LIBERIA INFRASTRUCTURE AND INCLUSIVE GROWTH two
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