The Pro-Poor Agenda for Prosperity and Development 2018 to 2023 (PAPD) is the second in the series of 5-year National Development Plans (NDP) anticipated under the Liberia Vision 2030 framework. It follows the Agenda for Transformation 2012-2017 (AfT). It is informed as well by lessons learned from the implementation of the Interim Poverty Reduction Strategy 2007 (iPRS) and the Poverty Reduction Strategy (2008-2011). The fundamentals underpinning the PAPD are: i) Liberia is rich in human and natural resources; but ii) is deprived of development largely because its human capital lacks the knowledge to transform the natural resources into wealth—whether through farming, mining, fishing, or other productive ventures that require technology or financial investments. Consequently, Liberia is relatively rich in natural capital but relatively poor in relations to its peers in both human and produced capital. Moreover, because of a legacy of entrenched inequality in access to development opportunities, widespread infrastructure deficits and pervasive poverty have become the binding constraints to future growth and prosperity.


The Pro-Poor Agenda for Prosperity and Development 2018 to 2023 (PAPD) is the second in the series of 5-year National Development Plans (NDP) anticipated under the Liberia Vision 2030 framework. It follows the Agenda for Transformation 2012-2017 (AfT). It is informed as well by lessons learned from the implementation of the Interim Poverty Reduction Strategy 2007 (iPRS) and the Poverty Reduction Strategy (2008-2011). The fundamentals underpinning the PAPD are: i) Liberia is rich in human and natural resources; but ii) is deprived of development largely because its human capital lacks the knowledge to transform the natural resources into wealth—whether through farming, mining, fishing, or other productive ventures that require technology or financial investments. Consequently, Liberia is relatively rich in natural capital but relatively poor in relations to its peers in both human and produced capital. Moreover, because of a legacy of entrenched inequality in access to development opportunities, widespread infrastructure deficits and pervasive poverty have become the binding constraints to future growth and prosperity.

1.0 The Current Context, National Vision, and Principles

1.1 Introduction

The Pro-Poor Agenda for Prosperity and Development 2018 to 2023 (PAPD) is the second in the series of National Development Plans (NDP) anticipated under the Liberia Vision 2030 framework. It follows the Agenda for Transformation 2012–2017 (AfT). It draws heavily on the implementation experience of the AfT and incorporate lessons from the implementation of the Interim Poverty Reduction Strategy 2007 (iPRS) as well as the Poverty Reduction Strategy (2008–2011).

Liberia is rich in human and natural resources. The most valued asset is its people and to the extent that widespread poverty and inequality undermine their potential, these challenges also constrain the capacity of the Liberian people to attain their aspiration to live in a peaceful and united country and enjoy prosperity. While the challenges going forward are many, the opportunities are enormous considering the current demographic makeup.

Liberia is also severely underdeveloped because the human and knowledge capital have not been developed to productively and sustainably exploit the natural resources and produce wealth. While the Government of Liberia acknowledges that progress has been made with the support of development partners on key national aggregate indicators over the past 12 years; such as per capita income growth, the Human Development Index (HDI), life expectancy at birth, and mean years of schooling, these gains have not been universal and sustainable.

Additionally, when inequality measurements are introduced, the adjusted HDI shows a loss of 33.4 percent due to inequality in the distribution of the basic indicators of development. The average loss 4 for Sub-Saharan Africa is 32.2 percent over the same period.4 On the inequality adjusted and the gender HDI, Liberia falls among the lowest 10 countries.5

Today, most Liberians remain poor, face some form of income and/ or food insecurity and vulnerability. In 5 of the 6 statistical regions of the country, absolute poverty levels started to decline at the end of the conflict in 2005; but since 2014 absolute poverty is on the rise. The Government of Liberia sees pervasive poverty, inequality, and widespread deprivation as the greatest restraint to sustaining the peace and accelerating growth and sustainable development. Additionally, the fractured relationship between the state and the people must also be addressed as a matter of priority to be able to go forward.

Therefore, this document is divided into two parts. Part I is the main document. It provides a broad overview of the development challenges and the short to long-term priorities of the government. Chapter One provides the context, experience with state building--including the narratives on the formation of the state that explain the drivers of the conflict and contributors to widespread and pervasive poverty. It also presents the macroeconomic performance and conceptual framework underpinning the PAPD. Chapters two to five unpack the Pro-Poor Agenda; breaking it down into priorities and interventions around four pillars aimed at building human capital, restoring growth and diversifying the economy, sustaining peace, and building a more capable state while reducing corruption around strong institutions and good governance. Chapter six describes the implementation and chapter seven presents the financing scenario. The monitoring and evaluation plan is the subject of chapter eight. Part II is the annex comprising the results framework delineating the high-level national targets and interventions under each of the four pillars.

1.1.1 The Pro-Poor Agenda

The Pro-Poor Agenda is about altering the fundamental structure of the Liberian economy so that the growth does not leave the poor behind. The PAPD aims to bring prosperity to all and draw all Liberians at home and abroad into a transformed process of nation building--leaving no Liberian behind. Over the next five years, addressing the basic needs of Liberians for income security, better access to basic services, and greater opportunities for self-improvement in a peaceful, inclusive, and stable environment will be at the core of the pro-poor approach. Over the long term, raising income levels and economic status to a middle-income country as outlined under the Vision 2030 framework will remain in focus. Over the next five years, however, the priority will be placed on removing the binding constraints to reaching that goal.

Nearly two-thirds of the population currently lives in the Montserrado and the North Central statistical regions comprising four counties. Within this geographic space, unplanned urbanization continues to accelerate at an unprecedented pace, creating a potential source of economic paralysis or an opportunity to develop urban markets. The rapid growth in the size and number of informal settlements is now a significant health risk and could impose a potential threat to peace and stability over the long term, if lef unresolved.

Residents of informal settlement generally have little or no security of title to the land they occupy, and they face severe income insecurity. Unemployment is twice as high as in rural areas and three times as high among the youthful population. Moreover, access to basic services such as electricity, water, and sanitation in some informal settlements is worse than in rural areas.

Therefore, the PAPD will mark a paradigm shift from sectoral-based national development planning to a spatial integrated multi-sectoral planning--with a major focus on addressing disparities and inequality between demographic groups and regions of Liberia. Nevertheless, to fully appreciate the current situation and agree on the strategy for going forward, it is important to understand Liberia’s current under-development from a historical perspective.

1.1.2 Historical Perspective

Trough much of its history, Liberia has struggled with building an inclusive nation with shared values and cultural appreciation extending well beyond the narrow political and economic interests of the ruling elite. State power and the control of natural resources, and the wealth that process conveys, are often co-opted by the ruling class to the exclusion of others. This zero-sum game of politics has greatly impeded national development, eroding the culture of public administration, as state institutions find themselves largely servicing the interests of those currently in power.6

Liberia became an independent country in 1847 when five settler communities formed by repatriates from the United States declared the newly independent republic in the face of challenges to their sovereignty from local rulers and the colonial neighbors—France and Britain. Trough a series of negotiated peace treaties and deeds of cession made with the local rulers over the next three decades to end recurrent contests over land boundaries and control of resources and to improve trading relations, the 16 nations and 5 settler communities were brought into the new body politic under an arrangement that allowed a dual system of governance to prevail—one for the five settlement areas another for the provinces. Under this arrangement, local administrators became and continue to be de facto “agents” of the President to the hinterland population. Laws and practices enforced by the local chieftaincy system generally embodied traditional interpretations of individual rights, civil and criminal laws, child custody and rearing, land tenure and other property rights, control of communal assets, etc. Much of the “traditions”, such as female genital mutilation (FGM) and property inheritance, are still being enforced in rural areas, even though many have been overridden through the extension of civil law. Harmonization of the dual system is incomplete.

By 2001, the 4 hinterland territories (occupied by the 16 nations) had grown into 10 counties bringing the total to 15. Tough the 15 counties enjoy co-equal political status by law, access to resources for development remains tightly controlled. Disparity in development and opportunities for self-improvement remains. Historically, access to “development” resources has been perceived as a presidential prerogative and not a fundamental right of every citizen with the government held as the duty bearer.

The political space remains highly contested today but Liberians peacefully cohabitate the geographic space, interacting and intermarrying across cultural and social bands without hindrance. In the political space, voters’ preference in national elections tends to lean towards candidates from their own ethnic group in the first round, because of the perception that one’s interests would best be served by a kinsman. But the fact that no single group is large enough to decide the outcome in the majority electoral system, ensures that political coalitions must be formed across ethnic and geographic lines.

The inauguration of George Manneh Weah as the 24th President of the Republic of Liberia and Jewel Howard Taylor as first female Vice President was the first peaceful and democratic transition of power in 73 years. Moreover, it was the first generational change in national leadership by popular vote since the introduction of universal suffrage in 1951 and the launch of the National Unifcation and Integration Policy in 1960. This presents a unique opportunity to deliver the elusive socio-economic and political transformation long demanded by Liberians.

1.2 Population and Development

1.2.1 Total Population

Liberia’s population was estimated at 4,243,475 in 2016.7 The national average household size is 4.3 persons and ranges from 3.7 persons per household in Gbarpolu county (Northwest region) to 4.9 in Maryland (Southeastern region) respectively. At the current growth rate, the total population is likely to be between 4.8 and 4.9 million by the end of the planning period in 2023. Figure 1.1 shows the population pyramid in 2016. Figure 1.2 shows the population forecast to 2028 offering three fertility scenarios—low, medium, and high.8

Figure 1.1:
Figure 1.1:

Population Pyramid by Age by Gender

Citation: IMF Staff Country Reports 2021, 010; 10.5089/9781513566313.002.A001

Figure 1.2:
Figure 1.2:

Population Forecast to 2028

Citation: IMF Staff Country Reports 2021, 010; 10.5089/9781513566313.002.A001

1.2.2 Gender and Age Distribution

Females make up 51.1 percent of the population and male 48.9 percent. The sex ratio of the population is 1.011 (1.011 male per 1 females) which is lower than the global sex ratio (1.016 male per 1 female). By age categories, the skew leans heavily towards children, youth, and young adults at productive stages of the life cycle. About 70 percent of the population was below the age of 35 and nearly half (44.5%) of the population was below the age of 15 years in 2016.

Age dependency ratios are very high due to a combination of high fertility rate and short life expectancy. At about 90 percent, each working adult must provide support for himself or herself, while providing for a child or a dependent elderly person. Most likely this would be a child under the age of 15 because of the low proportion (3 percent) of the population above the age of 64 years. In urban areas, the age dependency ratio falls to 78.2 percent but reaches 102.7 percent in rural areas where the ratio of working age to dependent population is over 100 percent. Nevertheless, the untapped productive potential offered by this highly youthful population is enormous.

Life expectancy at birth is currently 61 years old. Liberia is among the top six countries where life expectancy increased the most over the past decade. Global life expectancy now stands at 71 while life expectancy in Sub-Saharan Africa (SSA) stands at 46. If birth and death rates will remain at the same level in SSA, female can expect to live slightly longer than male with life expectancy at 59 years compared to male counterparts at 55 years.

1.2.3 Spatial Distribution

Table 1.1 shows that nearly two-thirds of the population live in Montserrado and the North Central statistical regions comprising four counties. Figure 1.3 shows the overall spatial distribution of the population by county.

Figure 1.3:
Figure 1.3:

Spatial Distribution of the Population

Citation: IMF Staff Country Reports 2021, 010; 10.5089/9781513566313.002.A001

Table 1.1:

Distribution of the Population by Statistical Regions

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About 63 percent of the population live in the four counties comprising the first two regions. Tree out of every five can be found in seven counties. This skew leaves large regions behind in access to basic services and infrastructure.

1.2.2 Labor Force and Labor Productivity

The economically active population (EAP) is expected to grow from 1.6 million in 2018 to nearly 2 million in 2023.10 Nearly 80 percent of the EAP is in informal employment. About 35 percent of Liberian households make their living predominantly through agricultural related activities.11 The population in informal employment will grow from nearly 1.3 million in 2018 to 1.6 million by 2023 without significant intervention in job creation.

In formal sector employment, 65 percent of wage earners work for private employers in the service sector (LISGIS 2016).12 About 20 percent work for the government and 15 per work for nonprofit organizations. A higher proportion of women fall into the lower earning work categories. Figure 1.4 shows that as wage incomes rise, the share of women relative to their male counterparts falls.

Figure 1.4:
Figure 1.4:

Wage Earnings of Women and Men

Citation: IMF Staff Country Reports 2021, 010; 10.5089/9781513566313.002.A001

Most non-farm household enterprises (56.1%) are run by women. Most of those enterprises (70.8%) have gross revenue of less than L$30,000 (US$200) monthly. Average household farm size is 1.6 hectares; but it rises to about 2.2 hectares in the North Central region. Households falling in the poorest quintile cultivate 0.3 hectares while those in the richest cultivate 3.6 hectares on average. Typically, households (74%) grow a mix of food crops with rice and cassava predominating. At least a third of farming households have some acreage of permanent/cash crop farms. On average, yields are about 80 percent of the regional crop yields.13

Despite the large proportion of the labor force in the working age category, low labor productivity and an acute shortage of workers with the appropriate skills inhibit the potential of the formal and informal sectors. This constrains broad-based economic growth and recovery. The 2010 Labor force survey found that the formal sector employed less than 20 percent of the labor force. It also found only 56 percent of the working age population was literate; and when disaggregated, female literacy in the labor force was 44.8 percent.14 About 47 percent of women and girls, and 33 percent of boys and men have never attended school.

1.2.3 Urbanization and Sustainable Cities

Slightly more than half (54.5%) of all Liberians live in cities and towns of 2,000 residents or more and the proportion is growing. By current estimates (LISGIS HIES 2016), 56 percent of the labor force reside in these urban areas. Most of the movement have been towards the capital city Monrovia, but other population shifts have been seen along the current economic corridors as well. The major economic corridors drawing significant population can be seen in Table 1.2 below.

Table 1.2:

Economic Corridors and Rural Urban Migration

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Economic transformation is typically triggered by productivity gains in agriculture and the release of workers from farming--pushing them towards urban areas where higher efficiency industry locates. Progress in income and social indicators are usually associated with a demographic boom which fuels urbanization until fertility eventually decreases. This traditional model of change does not seem to apply to Liberia. Agricultural productivity remains low and the skill base of the largely youthful labor force is poor to modest at best, while rapid urbanization continues.

Therefore, the urban environment (especially Monrovia) is under unprecedented stress. Large areas are converting to informal settlements where the quality of life is on a decline and where the risk of another disease outbreak is high. The affordable housing stock is extremely limited. The urban road network, water, and electricity supply are expanding but from a complete state of collapse during years of civil conflict. The risk of instability due to the presence of a largely youthful population in search of income earning and self-improvement opportunities remains high.

Increasingly, the attention given to urban governance issues will enable the government to address the needs of much of the population. There is an urgent need for comprehensive urban development strategies that tap into the potential of other rapidly growing, but still manageable, urban centers such as Ganta, Pleebo, Buchanan, and Greenville.

1.2.4 Liberians Living Abroad

Nearly 38 years--more than one generation-- have elapsed since the first wave of out-migration. Therefore, the notion of a large Diaspora population predisposed to resettling to Liberia en masse has become increasingly murky. Liberians living abroad, however, have been actively engaged in the recovery process--contributing much needed food, medical commodities, and returning to work as community service volunteers during emergencies. Personal remittances inflow reached 27.1 percent of GDP by 2017-making Liberia the largest recipient of US dollar remittances in Sub-Saharan Africa and the ffh most dependent in the world.15 Nevertheless, the role of the population living abroad in the realization of the long-term goals of Liberia remains largely unclear.

An estimated 500,000 Liberians (about 10 percent of the total global Liberian population) are believed to reside abroad. This includes communities in Asia, Europe, United States, and in neighboring African countries. An estimated 43 percent are in the North America, 36 percent in the West Africa sub region, 16 percent in Europe, and 5 percent elsewhere. The largest concentration in any one country, however, can be found in the United States (US). The US community is also likely to be the best organized and most highly engaged in development opportunities in Liberia. 16

The Government of Liberia recognizes that most Liberians living abroad have not reached the levels of wealth that will enable them to make significant capital investments at home. Tose who made investments found the risk vs reward ratio unattractive given the vagaries of the domestic market and the large infrastructure deficit. Lack of support for those willing to risk social and business ventures also limit the range of potential areas of business for entrepreneurs.

Nevertheless, The Government of Liberia recognizes the sacrifce made by Liberians abroad to sustain family and relations back home and their continuing interest in engagement in the national development process—especially in their communities of origin. Therefore, continuous engagement will remain a priority to facilitate their return to establish businesses, nonprofit organizations and charities, that create jobs and expand our social safety net. The government will remain opened to volunteer services in education, health, and social services; particularly of well-trained and skilled individuals. Reducing corruption and improving the business environment will be important. Facilitating the inflow of family remittances will remain a government priority well into the future.

1.2.5 Liberia’s Demographic Dividend

With nearly 53 percent the population between the ages of 15 and 64, the share of the working age population is larger than that of the non-working age population (0 to 14; 65 and older). Another 44.5 percent of the population is below the age of 14; the clear majority of whom will enter the labor force over the next decade. This should, in principle, give Liberia a demographic dividend. The magnitude of the dividend will be tempered by the ability of the formal economy to absorb and productively employ this workforce. Because of the limited opportunities for formal sector employment, large numbers have turned to farming and other productive activities in the informal sector, where returns from farm ventures and microenterprises remain low.

Liberia’s ability to deliver a more balanced growth that cuts across income classes, geographic regions, and age groups of the population will determine whether this dividend will move in productive or unproductive directions over the next decade.

Leveraging the Demographic Dividend

Liberia’s ability to deliver a more balanced growth that cuts across income classes, geographic regions, and age groups of the population will determine whether this dividend will move in productive or unproductive directions over the next decade.

Extreme actions will be needed to establish and sustain minimum living standards. Putting into place policies and strategies to harness the demographic dividend will be critical to sustaining the peace. Furthermore, interventions will be needed to raise the aspirations of the poor, improve human capital, provide some form of income security, and raise the level of savings. These will have to come through technical and vocational education, increased access to new technology, access to relevant skills needed by the market, expanding access to cross-border markets and to training in small business and entrepreneurship.

Sustaining an enabling business environment will also be critical to entrepreneurship and the growth of new industries. Increased investment in infrastructure will improve the links between individuals, firms and markets for goods and for labor as well. Greater financial inclusion, targeting the youth and the rural-based population, will provide access to new mobile financial services technology that can draw small economic actors into the broader economy. Information technology and the move toward a digital, cashless economy should amplify the dividends to be reaped from all these activities, enabling Liberia to leapfrog some of its constraints.

1.3 Patterns of Poverty and Vulnerability

1.3.1 By Regions

Poverty and vulnerability in Liberia have both geographic and demographic dimensions because of the historical patterns of growth and development. Even these national aggregates mask the full story of poverty and vulnerability and how they undermine the potential of the country. Figure 1.5 shows absolute poverty by regions of Liberia and Table 1.8 shows the distribution by county.

Figure 1.5:
Figure 1.5:

Absolute Poverty by Region

Citation: IMF Staff Country Reports 2021, 010; 10.5089/9781513566313.002.A001

Table 1.3:

Absolute, Food, and Extreme Poverty by County

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Source: LISGIS
Table 1.4:

Liberia Multidimensional Poverty Index 2018

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Table 1.5:

Liberia Vision 2030 Long Term Outcomes

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Table 1.6:

Seeds of Change

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Table 1.7:

Alignment of PAPD, AfT, AU Agenda 2063, and SDG’s

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Table 1.8:

High-Level National Targets and Development Outcomes of the PAPD

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The figure also shows that more than 4 of every 5 residents (89%) of the Southeastern B region live in absolute poverty. In the prime agricultural North Central region, absolute poverty restrains almost the same proportion (82%). In and around the capital city Monrovia, only 28 percent live in absolute poverty and the proportion is declining. The four counties with the lowest levels of poverty are Montserrado, Sinoe, Margibi, and Grand Cape Mount.

When viewed from a multidimensional perspective, which speaks more directly to the challenges and opportunities to building human capital, a different pattern emerges. Table 1.3 uses the Multidimensional Poverty Index (MPI) to reveal the incidence and intensity of poverty across counties of Liberia. Unlike income poverty, the MPI is a measure of 10 indicators of development deprivation across three dimensions—education, health, standard of living.17 MPI calculations are based largely on data from the 2013 LDHS (LISGIS).

Based on the above estimates, about 3 million Liberians (70.1 percent) were multi-dimensionally poor (deprived of development). Another 924 thousand are near multidimensional poverty. Across Sub-Saharan Africa, about 54 percent of people suffered multidimensional poverty in 2015, but 30 of the 35 countries analyzed succeeded in reducing their MPI significantly over time. Liberia is among the remaining five that did not reduce the MPI over time.

Liberia’s overall score is 0.356, putting it towards the bottom in ranking of the 102 developing countries in the 2015 Human Development Report. Furthermore, Table 1.4 reveals that Rivercess, Grand Bassa, Bong, Gbarpolu, and Grand Cape Mount are the five counties most deprived of education, health, and standard of living. Grand Bassa, Bong, Gbarpolu, and Rivercess have the most intense deprivation. Only twelve of the 15 counties are above the national average of 0.374.

1.3.2 By Demographic Groups Women

Women are disproportionately represented in low-skilled, low-paying jobs and the wage gap between male and female persists. Although there are few differences in demographic composition of male and female headed households, when the head of household has completed secondary level education (high school), consumption levels are higher than in households where the head has not completed high school.18 Nevertheless, male-headed households (52.3%) have slightly higher poverty levels than female (46.3%).

Education makes a difference to the economic wellbeing of the household. The highest levels of poverty (66%) are found in households where the head had no education. With primary education the proportion falls to 58.7 percent, with secondary to 43.8 percent, and 15.9 percent when the head of household have some post-secondary education.

Agriculture accounts for an estimated 70 percent of the total labor force and women make up an estimated 75 percent of that workforce. In rural areas, women are traditionally given ownership of the crops they cultivate, but not the title to the land. Assumptions based on traditional gendered roles perpetuate female subordination and prevent access to rights of asset ownership and to economic resources. Nevertheless, poverty levels are highest (79.6%) in households where the head is self-employed in agriculture. Children

Most children live in poor households and cope with gross deprivation. These include risks of stunting, limited or no access to healthcare, lack of access to safe drinking water, and no toilet or sanitation facilities at home. Infant mortality rate is among the 20 highest in the world. The 2013 Liberia Demographic and Health Survey (LDHS) shows 32 percent of children under 5 years old are classified as malnourished, 6 percent wasted, 15 percent underweight, and 3 percent overweight. Essentially, the percentage of stunting has increased with the age of the child.

Childhood poverty differs from poverty in adult age because childhood is the most vital period in mental, physical, and social development. Various forms of deprivations during childhood, such as lack of food, health care, education, and safety as well as different forms of domestic violence can have long-term irreparable consequences resulting in intergenerational transfer of poverty, delinquency, and can contribute to different forms of addictions. Youth

Participation of youth in education decreases substantially after their 18th birthday. At 18 or older, youths are more inclined to transition to the labor force. Girls are at a high risk of dropping out of school. Boys are also at high risk of dropping out of school without employable skills, credentials, or other qualifications to acquire employment or self-employment. Youths who drop out of school need much more time (as much as two years) to be integrated into the formal labor force than their colleagues with acquired qualifications. The Elderly

The highest level of poverty is found among households headed by the elderly persons (60+). Slightly more than 60 percent live in absolute poverty, 48 percent in food poverty, while 22.2 percent live in extreme poverty. As a majority of the elderly have never worked in the formal sector, they are not likely to be vested in any pension scheme that provide some form of income security. Liberia does not have universal statutory social security for its elderly people. The only form of old-age protection available is the contributory national pension scheme for the wage-earning population. Under the currently eligibility criteria, no more than 300,000 persons would qualify. People with Special Needs

Social and cultural factors limit opportunities to find work while living with disability, but even more so, people with disability face discrimination from employers. Even those who find employment face wage discrimination because they tend to earn less than their colleagues. Disability and poverty are mutually reinforcing. Insecure living conditions, lack of access to basic services, malnutrition and other dimensions of poverty can lead to disabilities. Persons living with disabilities are usually excluded from social and economic life and their rights are not fully fulfilled.

1.4 Potential Drivers of Growth, Transformation, and Reduction in Inequality

This section outlines key opportunities to stimulate economic growth and development across the country. Well-endowed in natural resources and conditions favorable to tropical agriculture, World Bank estimates put Liberia’s national wealth per capita at US$10,227.19 Liberia ranks relatively high in natural capital (US$7,037) among African countries, but this is offset by low produced capital (U$$1,219), human capital (US$3,636), and by net foreign assets (US$-1,665).

Farming households comprised 35 percent of Liberian households in 2016.20 Slightly more than half a million Liberians make their livelihood through farm or related ventures. Secure access to productive land remains their most valuable resource and most severe constraint. Only five percent of cultivated land is privately owned; and less than three percent of farming households have a deed that can be collateralized or transferred from one generation to the next to build wealth. Most farming land is in community, tribal trust, or family held. The passage of the Land Rights Act in 2018 provides the framework to begin to address these constraints to wealth creation. Therefore, accelerating the rollout of the provisions will be critical to attaining the goals of the next NDP. Nevertheless, Article 22 of the 1986 Constitution provides limitations to private property rights. It ensures ownership and control of and access to all mineral resources on or beneath land, in and under the seas and other waterways, by the state. Communal land ownership is only validated when the President signs a tribal certificate under current laws. Even within the framework of the Community Rights Act and the Land Rights Act, the constitutional provisions prevail and those provisions that are inimical to the interest of foreign investors and state actors may be ignored when it is convenient to do so.

Taking the foregoing limitations into view, the economic potential that can drive and transform the macroeconomic landscape is compiled for the PAPD at the regional level as defined in the National Statistical System (NSS). The five NSS regions are: i) Southeastern A, ii) Southeastern B, iii) North Central, iv) Northwestern, v) South Central, and vi) Montserrado. A combination of improved service delivery, targeted investment in key sectors, reduction in infrastructure deficits, and investment in social protection will unleash the potential and transform regions outside of Montserrado.

1.4.1 Southeastern A Region

Southeastern A comprise Sinoe, Grand Gedeh, and Rivercess counties. Significant investments have been made in oil palm development in this region. The Agricultural Concession Agreements (ACA) could allow the production of between 150,000 to 200,000 hectares of oil palm over the next decade. Approximately 40,000 hectares in community oil palm--an out-grower scheme, is anticipated. The region also boasts the highest forest coverage rate within Liberia. The potential for effective management and development of forest resources is enormous. The Port of Greenville has been significantly rehabilitated to provide an alternative port for international trade. Along the coast, families engage in artisanal fishing with potential for increased production.

1.4.2 Southeastern B Region

This region comprises Maryland, River Gee, and Grand Kru counties. The region can be competitive in agriculture and forestry, cross border trade, fishing, artisanal mining, and expansion of rubber and oil palm production. Electricity is available at competitive prices and the Port of Maryland is under rehabilitation. Nevertheless, development of the potential is constrained by a poor road network that keeps the region isolated nearly half of the year.

1.4.3 North Central Region

The north central region has been the traditional food belt of Liberia. Average smallholderhousehold farm sizecultivation in acreagehectares is 5.4, 4.82.2, 1.94, and 3.41.39 in Lofa, Nimba, and Bong, respectively (the average farm size in Liberia is ).1.6 hectares) . The region also produced 54 percent of the basic food crops--rice and cassava, in 2016. It has a competitive advantage both in arable land and the predominant role agriculture plays in the regional economy. In addition to food, cofee, cocoa, oil palm, and rubber are grown.

Iron ore mining is done in two locations of the region. There is significant cross-border trade with neighboring Guinea and Cote d’Ivoire. The region is the highest contributor to domestic revenue after Montserrado county. Electricity is available at competitive rates in Nimba and is being extended to Bong; while a major primary road into Lofa is under development.

1.4.4 North Western Region

Gbarpolu, Grand Cape Mount, and Bomi counties comprise the north western region. The region has a huge potential in mining and panning, forestry development, artisanal fishing among communities living on the coast, and cross-border trade with Sierra Leone and Guinea.

Approximately 220,000 hectare of oil palm is under development through an ACA. Trough the ACA, an additional 40,000 hectares of out grower oil palm farms are to be developed with a potential export value between 50 and 75 million US dollars.

The region also boasts some of the best potential for tourism development. Affordable energy and road access are key constraints to development of the potential

1.4.5 South Central Region

This region is the traditional rubber belt where the largest plantation and numerous large out grower farms are located. Current projections put total production at the largest plantation at 66 million lbs. by 2025 and 90 million by 2030. Old rubber trees can be harvested to provide a sustainable alternative to hardwoods. The regional has a potential for value addition in rubber processing. Grand Bassa and Margibi counties form this region which is the third most populous after Montserrado and the North Central regions. The Roberts International Airport and the Port of Buchanan (the second largest in Liberia) are located here as well.

1.4.6 Montserrado Region

Montserrado is the traditional political, social, and commercial hub of Liberia. It is also the location for nearly all non-agricultural manufacturing activities. Without significant intervention, most economic growth will naturally occur in and around Monrovia, increasing historical and regional disparity.

Strategically, priority will be placed on improving the business environment in Montserrado and elsewhere, but significant capital investments will be directed to other regions to reduce infrastructure deficits and reduce the cost of doing business in those areas of the country. Figure 1.6 shows the development potential in agriculture and forestry, mining and panning, and in fishing across Liberia.

Figure 1.6:
Figure 1.6:

Potential Development Regions

Citation: IMF Staff Country Reports 2021, 010; 10.5089/9781513566313.002.A001

1.5 Lessons Learned from Previous National Development Plans (NDP)

The Poverty Reduction Strategy (PRS 2008 to 2012) and the Agenda for Transformation (AfT 2012 to 2017) were largely supported by development partners and through the annual budgets and medium-term expenditure framework (MTEF). On the government side, expenditure on compensation of employees comprised an estimated 51 percent of total by FY2016/2017 and 65 percent by FY2017/201821 as government attempted to increase capacity to deliver on the commitments made under those NDP’s. These are the major lessons learned from the execution of those NDP’s’.

1.5.1 Donor Dependency

Estimates show development partners’ share of the total expenditure on the AfT development plan rose from 64 percent in FY2012/2013 to 76 percent for the Fiscal Year FY2014/2015. Overall fiscal balance, without grant support, rose from negative five percent (-5%) to negative eighteen percent (-18%) between the two fiscal years.22 In response to the outbreak of EVD in 2014, an additional US$0.9 billion had been committed to fighting the outbreak in Liberia by the end of the fiscal year. While this illustrates the level of commitment of partners to the successful transition of Liberia from a failed state to a stable political and economic development environment, this made Liberia one of the most highly dependent on donor support in Africa.

Support came in multiple forms including direct budget support, directly-executed projects, and technical assistance. The health sector benefited from interventions executed through multiple modalities; including a pool fund mechanism and Fixed Amount Reimbursement Agreement (FARA). Under these arrangements, performance contracts were granted to nongovernmental organizations to operate health delivery points. The eventual collapse of the health care system in the face of the EVD outbreak brought into question the efficacy of these forms of aid in building critical systems for the country; and highlights the urgent need for a new partnership model for ODA. Challenges in Improving Effectiveness and Impact of ODA

The Global Partnership for Effective Development Cooperation monitoring framework consists of 10 indicators based on the Busan commitments for more effective development cooperation and on the Paris Declaration on Aid Effectiveness. The midterm review of the AfT returned mixed results on those indicators.

On the extent of use of the AfT results framework, the review confirmed that all the partners derive and linked their priorities to those of the AfT. On the proportion of funding disbursed and covered by indicative forward spending, disbursement rates on projected funding reached 83 percent in FY2014/2015—up from 57 percent in FY2013/2014. On percent of aid that is untied, reports show that less than 10 percent of ODA was untied by the end of FY2014/2015.

To achieve the intended outcomes, the availability of on time funding was critical. Factors delaying disbursements fall into two general categories—approval and processing formalities at the ODA source and the ability of the sector implementing agencies to deliver on the pre-conditions for release of funding. Moreover, the outbreak of EVD in 2014 led to the suspension in the implementation of all projects not related to the containment effort.

1.5.2 Economic Growth

A critical lesson learned from the design of the PRS (2008 to 2011) was that Liberia cannot simply recreate the economic and political structures of the past, which produced widespread income disparities, economic and political marginalization, and deep social cleavages, ultimately fueling the conflict. In the design and execution of its NDP’s, Liberia must create much greater economic and political opportunities for all its citizens and ensure that growth and development are pro-poor in the sense that they are widely shared--with the benefits spread much more equitably throughout the population.23

To jumpstart the moribund economy in 2008 and generate the revenues needed for the ambitious development agenda at the start of the PRS period, however, the government reverted to granting concessions and generous tax incentives to attract desperately-needed foreign direct investments (FDI). These took the form of mineral development agreements (MDA’s), agricultural concession agreements (ACA’s), Forest Management Contracts (FMC), Timber Sales Contracts (TSC), and Private Use Permits (PUP’s) for small producers. The National Investment Incentive Code was updated in 2010; and generous tax waivers were offered for development of tourism and trade infrastructures. These incentives attracted commitments of US$16 billion in FDI to be realized over a 25-year period.

The 2018 APRM review concluded that the process of securing, negotiating, and implementing these concessionary agreements in Liberia met internationally accepted best practices and brought benefits. Overall the economy grew by 6.7 percent over the period 2009 to 2013. The mining sector grew by 70 percent between 2005 and 2013. An estimated ffeen thousand jobs were created but large numbers were lost (2014 and 2015) when the twin shocks of the EVD outbreak and global commodity price decline occurred, with concessionaires ceasing operations. Over the same period, the agricultural sector grew by 2.8 percent creating an estimated 500,000 income earning opportunities .24

Nevertheless, implementation of business and investment policies have been deeply flawed due to a combination of limited capacity to effectively monitor compliance with the agreements and a lack of political will for enforcement. Adherence to the key principle of First Prior and Informed consent (FPIC) has been difficult . In some areas, communities have been adversely impacted by land loss and have become more food insecure.26 Exploitation of forest resources through elite capture for profit continued at a more aggressive scale. These outcomes have brought into question the continuing efficacy of the old economic structures in employment, revenue generation, and inclusion.

Liberia has not found a successful pathway from high level of dependence on natural resource exports and foreign assistance for the large inflows of U.S. dollars it needs for food and fuel imports. Nevertheless, the government recognizes that sustainable economic growth and diversification is possible with the right macroeconomic and fiscal policy mix. Structural and institutional inadequacies, and the lack of will to implement the policies, will need to be addressed to be able to go forward.

1.5.3 Planning and Coordination

The national planning process is top-down in structure. Sectoral and regional consultative meetings are held to review past performance of the NDP and build consensus on the best way forward. In principle, this connects the national, county, district, and community levels planning processes. Launched in Jan 2013, institutions within the Liberia Development Alliance (LDA) structure have four primary responsibilities:27--coordinating policy making, providing an open platform to all stakeholders, following up on the global commitments made under the “New Deal”, accounting for results and a functional M&E framework under the AfT. Nevertheless, structural and institutional inadequacies limit the operation of the planning process; and national ownership of the NDP commitments has not been realized. Liberia Reconstruction and Development Committee vs Liberia Development Alliance

Under the PRS, the Liberia Reconstruction and Development Committee (LRDC) supported the decision-making process of the cabinet. While the LRDC and the LDA structures were similar on paper, secretariat support for the LDA came largely from the MFDP and proved not as effective as the standalone secretariat of the LRDC.

Another feature of the LDA was the creation of a Delivery Unit in the Office of the President to monitor and report on projects of special interest to the President. Moreover, new structures were established to coordinate the response to the EVD outbreak. These consumed valuable time and attention needed for the implementation of the AfT, which was eventually suspended and replaced by an Economic Stabilization and Recovery Framework (ESRF) to steady the collapsing economy.

Going forward, it is critical that some delivery mechanism/unit serve as the locus for the execution of the PAPD. The unit should be led by a team of professionals, set apart, but routinely interacting with political actors and sectors to coordinate public investments, service delivery and partner support in targeted geographic areas.

1.5.4 Monitoring and Evaluation (M&E)/ Medium Term Expenditure Framework (MTEF)

Success of any of the NDP’s requires a robust M&E system that can effectively disaggregate data and periodically measure progress both at sector and regional levels to inform decision making. Significant data gaps on the National Key Indicators (NKI’s) used by the AfT highlight the challenge with monitoring and coordination of development between sectoral MACs and cooperating partners.

Likewise, while the MTEF provided effective fora and the associated institutional mechanisms to facilitate the making and enforcement of strategic resource allocation decisions, the challenge of full adoption of the MTEF as a single reform initiative has been insurmountable. Adhering to spending priorities has been a major challenge. Assurances of the availability of financing for priority projects were not met. Alignment and tracking of actual expenditure to pillars and interventions is limited because the government has not been able to produce budget performance reports that disaggregate outturns by sectors or regions.

A hybrid approach, with a smaller number of NKI’s linked to the SDG’s and the AU Agenda 2063, will allow sector MACs to appreciate their own roles and contributions to the Pro-poor national development agenda, while preparing for full migration to reporting against results and outcomes in the future. Progressively strengthening the National Statistics System (NSS) and reorienting its priorities toward capturing and systematic reporting on data needed for high level decision-making and execution of the NDP will be critical.

Applying the Multiyear Fiscal Framework (MYFF) to only one or two priority sectors, while maintaining cash budgeting or repeatable cost management on all others, will respond to structural and institutional inadequacies. Continuation of periodic Performance Expenditure Tracking Surveys (PETS) will improve accountability and transparency in the use of public resources and provide validation that resources reached intended beneficiaries.

1.5.5 Specific Measures to address Lessons Learnt

In view of the foregoing, this plan marks a paradigm shift in design and management of the NDP. Supporting the paradigm shift is the acknowledgement that increasing capital investments to boost economic growth and increasing social expenditure to create local markets and reduce vulnerability are not mutually exclusive. In fact, when properly sequenced they are mutually reinforcing and sustainable. Economic growth produces the income security and wealth that the poor badly need to improve their living standards; while increasing social spending can increase demand for goods and services provided by the market, and build human and knowledge capital, to tap into the new opportunities that will emerge because of growth. Shifting the Planning and Implementation Model

The PRS and the AfT reintroduced national development planning after a decade and a half of conflict and state collapse. The reorientation to production of deliverables through results-based management was a welcomed shift in development thinking; but the actual outcomes produced could have been greater given the level of resources committed to the effort. In Table 5, the key elements of a paradigm shift in the NDP approach for the PAPD is presented.

The first three are short term and the remainder are medium term. The first three come as a recognition that sustainable development is a complex process, with interwoven layers, and constraints in one sector can inhibit progress in another. Therefore, sustainable development requires removal or reduction of constraints across multiple sectors to create the enabling environment for progress in all sectors. This multi-sectoral approach will also create the framework for the domestication of the SDGs and alignment of the NDP with the AU Agenda 2063 and ECOWAS 2020.

Moreover, the spatial distribution of human settlements in Liberia shows that development corridors and domestic markets will naturally evolve along infrastructures such as roads, railways, ports, etc. Lifetime migration in search of decent living standards and security over the past three decades led to the current situation where more than half of the population now lives in urban areas. The development corridors approach will accelerate the normal migration process but will add alternative destinations for internal migrants. New Approaches and Economic Drivers

The last three elements introduce new approaches and potential drivers of economic growth. They recognize that significant volume of cross-border economic activity occurs naturally among the Mano River Union States. These are generally omitted or wrongly captured in official trade statistics. Going forward, stronger linkages need to be built between cross-border and other economic activities occurring along existing economic corridors, to take advantage of opportunities that will become available under the ECOWAS Protocols and the Common External Tarifs Arrangements; and of investments made in roads, ports, communications, energy and rail infrastructure development. Special Economic Zones (SEZ) will also be located along the economic corridors. These will in turn contribute to the economic rate of return needed to justify the capital spending.

Design and Implementation Thrusts of the Pro-Poor National Development Plan

  • 1 A migration from a sectoral to an integrated multi-sectoral approach to planning

  • 2 Introduction and migration to priority development corridors to serve as co-locations for priority regional interventions in partnership with economic and development actors; and establishment of a mechanism through which these decisions are made

  • 3 Baselining, monitoring, and evaluation based on geographic development regions defined by poverty indicators in the NSS and the SDG’s; and establishment of a social protection floor to form a part of the national aspiration to which an additional 1 million Liberians currently living in poverty and food insecurity will be raised

  • 4 Implementation of interventions to diversify the economy in anticipation of rising demand for goods and services in the ECOWAS sub region; reemphasizing the scaling up of agriculture and development of appropriate value chains and giving priority to those investments located in the development corridors

  • 5 Establishment of Special Economic Zones (SEZ) in development corridors to attract domestic and foreign investments through generous tax and financing incentives to spur economic growth; and the phasing out of project-based incentives to be replaced by sector-wide incentives embedded in the tax codes and made available to all investors reaching defined investment thresholds

  • 6 While reaffirming a commitment to sustaining an enabling political and administrative environment for private initiatives to thrive, and to the domestication of international conventions ratified by the government, shift efforts downstream to focus more attention on meeting basic needs of Liberians and removing the constraints to their personal growth and development recognizing that widespread poverty is a major inhibitor of the national potential.

1.5.6 New Deal for Fragile States

A Fragility Assessment and a list of PSG indicators were developed in 2012. In 2013, a New Deal Dashboard was developed, and New Deal principles were incorporated into the Government’s One Vision, One Plan (2013): “Agenda for Transformation: Steps toward Liberia Rising 2030”. Liberia renewed its efforts to implement the New Deal with the Ebola Recovery Assessment (conducted with UNDP, the World Bank, the EU) after a slowdown in activities provoked by the EVD crisis. An outline and roadmap for a Compact, and an inventory of the use of Country Systems, have not been developed.

Going forward, the PAPD replaces the AfT as the One Vision, One Plan and establishes the basis for much-needed dialogue and a possible agreement with ODA partners on how New Deal priorities, processes, tools and mechanisms can be built upon in the Sustainable Development Goal (SDG) implementation; including greater use of country systems to improve ODA impact over the 2018 to 2023 period. Liberia is among countries where efforts to eradicate extreme poverty, that are central to the SDG agenda, will be most urgent.

At the same time, Liberia will face the biggest hurdles in implementing the SDGs. Properly monitoring change across the 169 targets, particularly on SDG Goal 16 given the strong reference to sustaining peace and building a capable state in the PAPD, will severely stretch the capacity of the national statistical system and those of government MACs. A minimalist approach will need to be formulated and included into the PAPD implementation plan.

1.6 The Economy Under Review-Towards Macroeconomic Stabilization and Growth

Liberia’s dependence on the extractive industry from the mid-1960s to late 1980s coupled with the rapid growth in the population largely contributed to the imbalances in the economy--particularly in trade and the growing disparity between the rich and the poor. Reliance on non-renewable natural resource exports to drive economic growth and development did not produce sizeable and sustainable economic growth. Volatility in the commodity markets (iron ore, rubber, and timber) since the mid-1970s, and rising political instability, led to the precipitous decline in per capita Gross Domestic Product (GDP) .28

GDP growth has been volatile. Figure 1.7 shows the historical trend. Two periods of significant political upheaval are highlighted-reflecting the impact on the economy. Per capita GDP increased from about US$ 1,270 in the 1960s to US$ 1680 in the 1970s and sharply declined to below US$1,400 in the 1980s.29 Liberia experienced the worst decline, to less than US$ 115, during the civil war in the mid-1990s. From 1995 onward, the GDP growth improved and progressively increased to rates of 11 to 14 percent from 2007 to 2012—though this was from a low economic base. Growth did not create the anticipated jobs or achieve the desired structural transformation due to a combination of external and internal factors. By 2014, the economy plummeted from real GDP growth rate of 8.7 percent in 2013 to 0.7 percent and deteriorated further to 0.0 percent in 2015, and to -0.5 percent in 2016 due to the twin shocks of the drop in global commodity prices and the outbreak of the Ebola Virus Disease (EVD). Growth improved to around 2.5 percent in 2017 and is expected to rebound to 3.9 percent in 2018 . 30

Figure 1.7:
Figure 1.7:

Gross Domestic Product (GDP) Per Capita (constant 2010 US$)

Citation: IMF Staff Country Reports 2021, 010; 10.5089/9781513566313.002.A001

1.7 The National Development Plan Vision and Principles

1.7.1 Introduction

This section begins the unpacking of the PAPD. First and foremost, the PAPD is structured to be used as a tool that will enable MACs and partners to logically align short to medium term development initiatives to the long-term aspirations of the Liberian people. Learning from the challenges with building national ownership and keeping the commitments of prior plans, the PAPD breaks targets and indicators down to the regional level--to establish the baselines against which progressive reductions in geographic disparity can be measured.

1.7.2 Reaffirmation of the National Vision and Principles of Vision 2030

The PAPD is positioned as the second in the series of five-year NDP’s towards the national aspirations expressed in the Vision 2030 framework developed in 2012. The national vision statement emerging from that process is multidimensional and simultaneously addresses the social, economic, political, environmental, cultural, and technological aspirations of the Liberian people. Therefore, the high-level goals of the PAPD align with and address all these dimensions as well. If Liberia implements its development plans successfully, and attains its development goal, Liberia will have the attributes listed in Table 1.5.

1.7.3 Structural Transformation

During the national visioning exercise, Liberians also identified key seeds of change that can be leveraged by the government to drive structural transformation. These fall into four categories: i) emerging demographic changes, ii) new economic opportunities, iii) growing social integration and unity, and iv) governance system reform Seeds of Change

The demographic changes that were identified reinforce the view that a younger, more urbanized, and technologically savvy population can be the vehicle to escape decades of divisions, social and economic exclusion, and poverty. Nevertheless, rising numbers of female and child-headed households, and vulnerability of the elderly who are likely to also be heads of household are threats that will need special attention. On the economic front, a combination of regional integration opportunities, rising interest in business and entrepreneurship opportunities, the growing oil palm industry, combined with improved fiscal policy management will provide the new drivers of growth. There are new threats to greater social integration that need to be mitigated but greater interest in political activism by youths and women will sustain the increasingly democratic and inclusive nature to our politics. Finally, governance reforms in the creation of integrity institutions and a more professional posture of the security sector will have to be leveraged to create a more capable state.

1.7.4 Goals and Objectives of the Pro-Poor Agenda for Prosperity and Development Formulation of the PAPD

Following the inauguration of the newly elected government on January 25, 2018, a list of Presidential Priority projects was developed to begin the process of cutting waste, realigning the national budget, and re-purposing resources to address critical challenges in a range of areas related to the Pro-Poor Agenda. The thirteen pro-poor impact projects were designed to be delivered across key sectors while setting up the priorities for the PAPD. The election manifesto was translated into a short-term Transition Plan to the PAPD. A framework to guide the transition from the AfT and the Manifesto to the PAPD was formulated. At the core of the PAPD are the four pillars of the Manifesto: i) Power to the People, ii) the Economy and Jobs, iii) Sustaining the Peace, and iv) Governance and Transparency.

The process of drawing together the priorities and content of the four pillars has been highly participatory. Eleven budget sector meetings were organized with MACs and key partners to review performance under existing sector strategic plans, partnership arrangements, and budget allocations. Consultations were also organized in the 15 county capitals around the country. At these regional meetings, participants reviewed progress made under the AfT and evaluated the impact on local areas. New challenges and priorities emerging since the launch of the AfT were identified and the perspective of the new government on change and the way forward was explained. Participants came from a cross section of county residents and included women and people with disability. Approximately one thousand persons attended the events. Meetings were also held with Liberians living abroad in the United States, Europe, and West Africa to capture the perspective of a wide range of stakeholders outside of government and the country. Perspectives from the Consultative Process

Stakeholders were asked to deliberate on four points: a) what went well under the past NDP, b) what were the failures and possible causes of failures, c) what should be the priorities for the PAPD, and d) what are the immediate local issues the new government should address.

a) What went well?

Stakeholders submitted that there is significant improvement in personal safety and security because of the security sector reform accomplished under the previous NDP. There is a general perception of noteworthy improvement in the discipline of security sector personnel. Moreover, the LNP has been deployed in proximity to local communities reducing the response time and feeling of vulnerability to crime. The presence of regional hubs and police response units also contributed to heightened sense of security. Stakeholders also submitted that access to justice has improved with the construction of new courts, improvement in the caliber of judicial officials, better jury management, more use of alternative dispute resolution mechanism (ADR), and the increased efficiency of judicial proceedings.

On the economic front, more opportunities now exist for some form of agricultural commodity processing, supply of improved planting materials, additional agricultural equipment, and public transport. In coastal areas, the construction of fisheries landing site was cited as a job creator for youth in the coastal communities. The expansion in ICT through cellphone technology and access to mobile money services were cited as critical forms of inclusion drawing remotely located customers into the formal financial system—some for the first time. Stakeholders identified the growing number of local FM radio stations as important to keeping the communities informed and engaged on governance and economic development issues. Public infrastructure such as feeder roads, public facilities, and markets for domestic products, have been constructed to reduce the cost and risk of doing business. Business training with micro loans and grants, provided largely by nonprofit organizations, were also cited as important contributors to some form of income security.

The deployment of the County Service Centers (CSC) was identified as a much-welcomed expansion in access to essential government services. Trough the CSC, citizens awareness of and interest in greater decentralization of public services has increased. Women involvement in local administration has also improved; and people with disability are increasingly involved in local advocacy efforts. The establishment of integrity institutions increased awareness of human rights and highlights the need for greater transparency in public financial management. Stakeholders noted that access to basic education, health, water, and sanitation has also improved throughout the country. Rising enrollment of girls, improvement in teachers’ pay, direct payment, and more effective county health teams were mentioned improvements in the overall quality of life in rural areas.

b) What were the failures and possible causes?

While security personnel have been deployed, stakeholders felt that limited logistics, disparity in salary and benefits, limited training, and delays in the court system were significant barriers to security and undermined access to justice. Ineffective and limited support to adjudicate juvenile cases, and the rise of sexual and gender-based violence, were cited as evidence of failures of the NDP. On human rights and local peace and reconciliation efforts, stakeholders felt that follow-up is weak. They pointed out that traditional practices continue to interfere with girls’ right to education.

Furthermore, limited support for local business and agriculture development hinders local economic development and productive work for large number of youths. In many areas, limited access to roads and public electricity were cited as failures under the expired NDP. While access to health and education improved, stakeholders submitted that the standards remain poor. Generally, facilities are still in a weak or dilapidated state. Furthermore, access to safe drinking water and sanitation facilities is still challenging.

Stakeholders noted that CSC’s are not properly supervised and interruptions in services are frequent. Capacity challenge within local administration was cited as a major constraint to moving the county affairs forward. In some areas, it was reported that the County Superintendent was frequently absent and for extended periods.

Participants cited high level of donor dependency as a source of concern since this puts the sustainability of many local programs at risk. Others pointed to intermittent conflicts with concessionaires operating in their county as another source of concern. On occasion, stakeholders called for a review of those agreements to determine whether the concessionaire was compliant with the terms and conditions. Finally, the absence of waste disposal, recreational facilities, and athletics development programs targeting the large youth population was important failure of the NDP.

c) What should be the priorities of the PAPD?

As for the way forward on empowerment, stakeholders consistently cited access to good quality education and health as the top priorities for the PAPD. Demand for more and better health and education facilities and, for good quality instruction, was high. Water and sanitation facilities were also high in demand. Moreover, special programs targeting youth, empowerment of women and people with disability, and support for the elderly were high on the order of priorities.

On the Economy and Jobs, stakeholders recommended the training and deployment of “agriculture specialists” to the district and clan levels to introduce new technology, “provide new skills, improve monitoring, and to collect and disseminate data” relevant to the primary crops produced in the region. Storage, processing, and transport arrangements were also listed as critical needs that should be prioritized. Stakeholders noted that while it was important to pay attention to creating the right environment to attract foreign direct investment, increasing domestic productivity and returns to labor in agriculture were important as well. The agriculture sector was therefore identified as the major driver of growth and development-and stakeholders recommended it should be prioritized.

On Sustaining the Peace, stakeholders recommended prioritizing the maintenance of a visible presence of the civilian police and security organizations; but also felt that empowering some form of community watch mechanism could augment the limited capacity of the regular security forces. Stakeholders also recommended improving access to justice through enhancement of the court system, such as capacity building for magistrates and local deployment of more specialized courts and more dispute resolution mechanisms. Organization of election of chiefs and city officials, as required by law, was recommended as an important contributor to sustaining the peace.

On Governance and Transparency, stakeholders called for improvement of the CSC supervision, review of the guidelines for the County and Social Development Funds, and reduction in the influence of the Legislative Caucus on local selection and appointment processes. Strengthening monitoring and evaluation arrangement of service delivery and new development interventions at the local level were recommended for priorities of the PAPD. Ensuring ownership of the change agenda, making related information more accessible, and increasing the level of participation of local communities in the decision making and implementation of the PAPD interventions were also recommended.

d) What are the local issues that need to be addressed with urgency?

Stakeholders mentioned the deployment of suitably qualified teachers and health workers—and bringing them on to payrolls to ensure stability in service delivery. Frequent out-of-stock situation of essential drugs and supplies at local health facilities was cited as an urgent local issue that the new government must resolve.

Accessibility by road was often cited as a challenge that needs immediate attention. Participants felt that this has implications for service delivery and productivity across health, education, CSC, and for economic activities to thrive. Additional infrastructure deficits that need urgent attention include access to financial services, electricity, and markets. Stakeholders submitted that, going forward, the new government should pay special attention to enabling domestic private sector growth and developing the economic potential of each county.

Reducing the number of incidents of sexual and gender-based violence was also identified as an urgent local issue that the new government will need to address. This would require support for victims for psychosocial rehabilitation and to pursue justice. Stakeholders also recommended that the potential for religious and communal conflicts should not be underestimated, and prevention and mitigation measures should be introduced as soon as possible. Enforcement and implementation of laws, policies, measures, initiatives, that are already on the books should be addressed with urgency. Finally, interventions to reduce poverty and seasonal food insecurity should also be implemented with a sense of urgency.

The consultations with Liberians living abroad produced the same general conclusions and recommendations on the need to increase investments in infrastructure, education, health, justice, and personal safety and security. Less interests seemed to be shown in job opportunities in Liberia than in improving the business environment and reducing corruption among front line government administrators. Generally, Liberians living abroad cited corruption as an inhibiter to their possible return to engage in productive investments.

1.7.5 High Level Objectives of the PAPD

Liberia’s history with political, social, and economic development clearly demonstrates that a continuing emphasis on generating high GDP and per capita growth rates through FDI alone will not be enough to produce the long-term outcomes desired by the Liberian people. The widespread economic exclusion, poverty, and inequality that exists will undermine the capacity to build the human and knowledge capital needed to transform natural resource endowment into wealth and to sustain a stable and prosperous nation—if Liberia continues down that pathway.

Also underpinning the long conflict is a national identity crisis embedded in the first Constitution that Liberians are on a mission to seek Liberty and to Christianize a “benighted” Africa. Successive generations have been brought up to believe that there is a “special relationship” elsewhere that must be sustained at all cost and that Liberia is a Christian missionary nation.

The government recognizes and embraces our African identity first and foremost and acknowledges that development must start from a renewed mindset that Liberians come from different backgrounds and faiths that, taken together, enrich our cultural heritage and

Objectives of the Pro-Poor Agenda for Prosperity and Development 2018 to 2023

To build more capable and trusted state institutions that lead to a stable, resilient, and inclusive nation embracing its triple heritage and anchored on its African identity

To provide greater income security to an additional one million Liberians, and reduce absolute poverty by 23 percent across 5 out of 6 regions--through sustained and inclusive economic growth driven by scaled-up investments in agriculture, in infrastructure, in human resource development, and in social protection diversity. Therefore, the objectives of the NDP 2018 to 2023 are:

1.7.6 The PAPD Alignment to Regional and Global Development Initiatives

Table 1.7 shows the alignment of the PAPD with the AU Agenda 2063, and the SDG’s at four levels. Vision and principles form the first, goals the next, priority interventions/pillars at the third level and indicators for subnational decomposition of measurements at the fourth level. For the first time in Liberia’s history, targets of the national development plan will be disaggregated to the regional level.

The themes of unity, peace, inclusion, and stability under a democratic political dispensation are embraced by all visions and principles. Furthermore, recognition, appreciation, and respect for cultural diversity penetrates the goal level aspirations—as well as shared prosperity and a deliberate effort to leave no one behind.

This is particularly evident at levels III and I V, where the people will be at the center of the national development process and efforts will be made to track their progress at the subnational levels. In the Pillar arrangements, Power to the People encapsulates the Human Development and Cross-cutting pillars of the AfT. Sustaining the Peace and Governance and Transparency, replace Peace, Security & Rule of Law and Governance and Public Institutions, reflecting their contributions to sustaining the enabling environment through which the people will thrive.

Liberia remains stable but is still fragile and must pursue state capacity building, complete basic government transformation, and strengthen capacity and systems as well. A critical first step in this regard is taking ownership and leadership of the PAPD formulation and implementation process; while welcoming and appreciating technical assistance made available through development partners.

1.7.6 The Four Pillars of the National Development Plan

The PAPD presents results frameworks for each of the four pillars as tools to assist MACs and partners to logically link interventions to the high-level goals over the next five years; which in turn will bring Liberia closer to the realization of the aspirations defined in the Vision 2030 process. The results framework will also inform the revision to existing sectoral strategic plans as they expire, update progress measurement indicators used by the NSS, and fiscal prioritization within the context of the Medium-Term Expenditure Framework (MTEF).

To support the two high-level goals of the PAPD, eight national targets have been established. Strategies and pathways are built around four pillars as follows:

  • 1. Power to the People—Liberians empowered with skills and tools to gain control of their lives

  • 2. The Economy and Jobs—Private Sector-Led growth and job creation through prudent management of the economic inclusion process and more effective resource mobilization

  • 3. Sustaining the Peace—Promoting a cohesive society for sustainable development

  • 4. Governance and Transparency—Building state capability for inclusive and accountable governance and sustainable development

Sixteen development outcomes have been identified around the strategic priorities corresponding to these four pillars; and 120 sectoral targets with key performance indicators have been delineated for progress measurements and tracking. HDI and SDG indicators will also be used to ensure alignment with development assistance priorities of key partners.

Interventions under Pillars One and Two will contribute directly to poverty reduction and empowerment goals, while those under Pillars Tree and Four will contribute to the building of capable and trusted state institutions pursuing a new vision of full integration into the African continent in culture and vision. Figure 1.8 illustrates the reinforcing links and relationships between the pillars and the broad development goals of the PAPD. To improve livelihood and reduce disparity, the enabling environment must be created through the interventions in Pillars Tree and Four. Moreover, a stable and resilient nation on the African continent can only emerge through prudent investments in education, health, and infrastructure in ways that reverse precarious imbalances in development across population groups and regions of Liberia.

Figure 1.8:
Figure 1.8:

Reinforcing Links and Development Pathways

Citation: IMF Staff Country Reports 2021, 010; 10.5089/9781513566313.002.A001

Each pillar has a goal and a set of development outcomes to be produced over the next five years. The sixteen development outcomes spread across the four pillars. Table 1.8, on the following page, reveals the high-level targets expressed as measurable HDI and MPI indicators and the absolute poverty targets disaggregated by regions.

1.7.7 Theory of Change

The PAPD is premised on a Theory or Change (TOC) recognizing the multi-faced and cross-sectoral nature of sustainable development. As used in this context, the TOC is the roadmap for change that will be followed by the government and its partners. While the results framework identifies the frontiers to be reached, the TOC describes how those outcomes will be produced--the “seeds of change” the government hopes to leverage and the assumptions against which progress can be made.

The fundamentals sustaining the PAPD is that Liberia is rich in human and natural resources; and that establishes a good basis for a future of shared stability and prosperity (Pillar Two). But the country is deprived of development largely because its human capital (Pillar One) lacks the knowledge capital to transform the natural resources into wealth—whether through farming, mining, fishing, or other productive ventures that require improved technology or financial investments. Moreover, the enabling environment for sustainable development must be created (Pillar Tree) and the governing institutions and systems strengthened (Pillar Four) to empower Liberians with the tools they need to gain control of their lives.

Road and other infrastructure development will be prioritized to form the physical corridors along which the new integrated and multi-sectoral approaches to spatial development will be implemented. In the context of the PAPD, improving access to all regions of the country through all-weather roads will be the enabler. Roads will also stimulate the creation of competitive economic clusters around Special Economic Zones (SEZ) to maximize the potential drivers of economic growth and development of each region. A reduction in the infrastructure deficit will open local and cross-border markets, reduce the factor cost of production, and attract private investments. Moreover, raising social spending in the neglected regions of the country will lift large majorities out of extreme poverty and food insecurity, create local markets where they do not exist, and raise labor productivity in agriculture and forestry, artisanal mining, and fishing. These interventions will help the poor to lead more productive lives and increase returns on their investments in microenterprises.

At the core of the TOC are the outcome maps in Figure 1.9 and Figure 1.10 illustrating views on how change will occur and what the likely indicators will be. The figures posit four development pathways to the two high-level PAPD goals—the Long-Term Outcomes (LTO). The pathways comprise the sets of interventions to be implemented and the seeds of change that will be leveraged to attain the goals. The development outcomes of each pillar are clustered to reveal the interaction and interdependence with each other forming joint preconditions for the achievement of the LTO. The outcome maps are organized at four levels--the LTO, development outcomes, Results, and Activity levels; corresponding to and defining the preconditions to the outcomes of the Results framework in Table 1.8.

Figure 1.9:
Figure 1.9:

Theory of Change--Pillars One and Two

Citation: IMF Staff Country Reports 2021, 010; 10.5089/9781513566313.002.A001

Figure 1.10:
Figure 1.10:

Theory of Change--Pillars Three and Four

Citation: IMF Staff Country Reports 2021, 010; 10.5089/9781513566313.002.A001

Figure 1.9 shows the two pathways to providing income security to an additional one million Liberians and reducing absolute poverty by 23 percent in the 5 out of the 6 statistical regions of Liberia where poverty is on the rise. The two outcome clusters are around: i) empowering Liberians with tools to gain control of their lives, and ii) attaining macroeconomic stability and creating jobs and livelihood opportunities. The key elements are significant scale up in the investment in skills development (including agricultural production and marketing technology), social protection to end extreme vulnerability and create local markets, steady growth in the economy buoyed by an improved doing business environment and more stability in global commodity prices for Liberia’s primary exports. A significant element will be reductions in disparity in infrastructure—especially roads, ICT, affordable energy, and water and sanitation. The government aspires to achieve 27 and 34 high-level national targets under Pillar One and Pillar Two, respectively.

Figure 1.10 shows the two pathways to building more capable state institutions that can lead to a stable, resilient, and inclusive nation anchored on its African identity and fully aligned with the AU 2063. The pre-conditions are: i) a cohesive society for sustainable development demonstrating three key characteristics, and ii) an inclusive and accountable public sector demonstrating two characteristics--reformed and rebalanced away from Monrovia with more robust structures reducing wastes. The government aims to achieve 32 and 25 high level national targets, respectively, to produce those outcomes over the next five years. Progress on governance systems reforms and on the AU 2063 will provide the main influences while demographic seeds of change and reduced poverty and inequality will be the basic assumptions for reduction in fragility and building trust in state institutions in areas of the country where most Liberians live in poverty.

In this context, the Pro-Poor approach will inspire sectoral institutions to define, designate, and measure goals in terms of the impact on people (empowerment, participation, health outcomes, etc.) rather than simple direct outputs of money, sets of activities, or building of physical assets. The interest of government and its partners will be on understanding the impact and sustainability of sets of interventions on the well-being of the poor beyond money (per capita incomes) and physical assets.

The Pro-Poor approach will progressively introduce multi-sectoralism as existing sector strategic plans expire. In formulating all subsequent sector policies and strategic plans, stakeholders will be required to determine how the proposed program affects issues within their own sector’s purview, and how it is likely to affect other sectors’ plans, objectives, and goals in the future. It will also require analysis, priority setting, and planning taking into consideration other sectors with increased attention to meeting the needs of specific target groups and regions of the country.

In subsequent sector strategic plans, integration will also be introduced. The integrated approach will share features of participation, de-concentration, and multi-discipline with the multi-sectoral approach. The distinguishing feature, however, will lie in drawing together multiple goals or packages for a project or several projects to be delivered to a specific target population or geographic region.

This TOC inevitably raises the question about the practicality and efficacy of attempting both horizontal and vertical integration, as well as the availability of capacity and tools for assessment of performance around various issues that are being integrated. The government concedes that the capacity to understand and implement this complex framework will be a major constraint. The government also anticipates enormous resistance to changing the course and ways of doing government business. Nevertheless, the government remains resolute that by demonstrating a capacity to formulate the framework on very short notice, it also demonstrated a resolve to find and assemble the talent for implementation.

As much as the PAPD projects must be initially sector-driven, it will be important to identify those strategic partners whose services will be required and bring them on board at initial stages as consultants or service providers, playing a support role for the sector within Pillar Working Groups. Consequently, the PAPD implementation approach will be multidisciplinary and interdisciplinary but sectoral and linear in management and execution. The detailed implementation and M&E plans follow as the next step in the migration from the AfT to the PAPD framework. In addition to ‘fleshing out’ the timelines, sequencing, and prioritization, agreement will be reached on the institutional arrangements and responsibilities for implementation and M&E.

2.0 Pillar One: Power to the People

2.1 Introduction

More than two decades of civil crises (starting 1980 and ending in 2005) undermined the advances made in human capital development in Liberia—ranging from hundreds of thousands of deaths to internal displacement and outmigration of skilled labor into the Diaspora. Fundamental to the achievement of the goals of the PAPD is the reversal of this trend and the improvement in the well-being of the Liberian people reaching the furthest first and leaving no one behind. This will require empowering them with the wherewithal to take control of their lives by providing access to quality education, ensuring access to essential healthcare, and increasing opportunities to attain a decent standard of living.

Human capital development in Liberia cuts across various social sectors with the Government of Liberia being the main duty bearer. It also cuts across gender with the exigency of addressing historic and systemic biases against women at home, in the marketplace, and in the political arena.

Therefore, four development outcomes will be produced under this Pillar by 2023. The government will make strategic and well-targeted investments in human capital development, coupled with efforts to create an enabling environment, that will unleash abilities and talents innate to the Liberian people. Pillar One and its interventions specifically aim to endow Liberians with the skills, tools, capacities and capabilities that place Liberians in greater control of their individuals lives, and on a path to extracting the highest value from human existence. Investments in human development also directly support social cohesion and reconciliation outcomes outlined in Pillar 3.

2.1.1 Current Condition of the People

Constraints can be found throughout the life cycle of Liberians from birth to death; but most are concentrated in access to basic education and to basic health, and in women and girls’ empowerment. The UNDP (United Nations Development Programme) Human Development Index (HDI) and supporting analyses are widely recognized as one of the best sets of measurements of human progress along the three basic dimensions of: i) long and healthy life, ii) access to knowledge, and iii) decent standard of living. Table 2.1 shows the HDI indicators and the related indicators of the Sustainable Development Goals (SDG).

Table 2.1:

HDI and SDG Indicators

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The 2016 report explores who has been left behind in human progress, and how, among 188 ranked countries. The report puts Liberia’s HDI value for 2015 at 0.427 or at 177 of 188 countries in the ranking. Between 2000 and 2015, the value improved from 0.386 to 0.427 (or by 0.41 points). Table 9 shows that Liberia falls below the average HDI for SSA (0.523) and Low HDI countries (0.497). At 61.2 years, the average life expectancy in Liberia is slightly higher than that for SSA (58.9 years) and that for Low HDI countries (59.3 years). Since 1990, average years of schooling in Liberia rose from 2.6 to 4.4 years. But in 2015 Liberia still fell below the average of SSA (5.4 years) and Low HDI countries (4.6 years). Table 2.2 compares HDI values, life expectancy at birth, average years of schooling to the averages of Sub-Saharan Africa (SSA) and to Low HDI countries.

Table 2.2:

Liberia’s HDI and Component Indicators relative to select groups of countries

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When the values are adjusted to show the impact of inequality in Liberia, it loses 33.4 percent of the overall value compared to a 32 percent loss for SSA and Low HDI countries. On life expectancy, Liberia loses 33 percent of HDI value due to inequality compared to 35 percent for SSA and Low HDI countries. On education, however, Liberia’s HDI loses 43 percent of its value compared to 34 percent loss for SSA and 37 percent for Low HDI countries. Inequality adjusted HDI and the comparators are shown in Table 2.3.

Table 2.3:

Liberia 2015 Inequality-Adjusted HDI relative to select groups of countries

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Finally, the HDI is adjusted to reflect the effects of gender disparity on Liberia’s development. The Gender Inequality Index (GII) measures gender-based inequalities in respect to reproductive health, empowerment, and economic activity. Liberia ranked 150 of 159 countries in the 2015 GII. Table 2.4 shows how Liberia fared with key comparator groups of countries in SSA and Low HDI countries. It clearly shows that by making a significant reduction in maternal mortality rates, adolescent birth rates, and an increase in the mean years of schooling and income of females Liberia could fall well below the SSA average GII and increase its overall HDI.

Table 2.4:

Liberia 2015 Gender Inequality Index relative to select groups of countries

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2.1.2 Desired Outcomes in Human Capital Development

Table 2.5, on the following page, shows the relationships between the high-level goals, national targets, and desired development outcomes of Pillar One as they compare to the SDGs and the AU Agenda 2063. Despite the recent reversal in development gains attributable to the twin shocks of the Ebola Virus Disease (EVD) outbreak and the price collapse of Liberia’s export commodities, there is a great opportunity to build upon progress made in education outcomes over the past decade.

Table 2.5:

Pillar One--Power to the People

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The four outcomes listed in the table are interlinked for a clear majority of Liberians given the demographic profile of the country; but more so for women and girls (gender), children, people living with disability, and the large number of youths striving to make a meaningful and sustainable transition into adulthood. The outcomes cut across all social sectors. Given the influence of women inequality on the overall HDI of Liberia, women and girls issues are reflected in all four outcomes. Empowering women and Girls

Reducing out of school, and increasing retention and completion rates for girls, raising minimum infrastructure standards for boys and girls and ensuring appropriate responses to GBV are major targets under human capacity development. The provision of lifelong learning opportunities on an equitable and inclusive basis will be a special emphasis under the PAPD. Reducing the maternal mortality rate is a priority along with prevention of teenage pregnancies in the home and school environment.

Reduction in under-five malnutrition of girls and boys will reduce risk of early life impairment which can become permanent and might also affect future generations. Malnutrition prevention will bring about important health, educational, and economic benefits. One outcome deals specifically with reducing women inequality in political, social, and economic life through government and partner supported interventions and in partnership with women groups and communities. Among the sets of interventions to produce this outcome is the adoption and strengthening of sound policies and enforceable legislation, the application of gender-responsive budgeting (GRB) in the multi-year fiscal framework of the government, and the implementation of the Revised National Gender Policy. Supporting meaningful transition of youth into adulthood

The youth development outcome seeks to accelerate the process of transforming Liberia’s demographic dividend into a potential driver of growth and transformation starting with expanding social inclusion through work and life skills opportunities; in addition to scaled-up TVET interventions under human capacity development. These interventions will target young adults-half of whom will be women. Moreover, ensuring lifelong learning opportunities through Alternative Learning Programs (ALP) will target over-age out-of-school youths. Social Protection Investments to Improve Lives and Create Local Demand

Social protection investments include wider and sustainable expansion in access to the four minimum guarantees: i) access to essential health care, ii) basic income and food security for the whole family-especially children in the family environment (including vulnerable groups and people with disability), iii) providing some form of basic income for the working age population through pre-employment support and household enterprises for adolescents and young adults, expansion in the national social pension scheme, enforcement of the Decent Work Act and iv) social grants for the elderly, pregnant women, and people living with disability. A major thrust of the pro-poor agenda is to raise total spending on social protection related investments from less than one percent to two percent of GDP, focusing on those living in extremely poor and food insecure households and regions of the country first to be able to reduce overall inequality.

2.2 Building Human Capacity for a Knowledge Economy

2.2.1 Basic Education and Technical Vocational Education and Training (TVET)

Progress has been made in increasing school enrollment, but Primary Net Enrollment Rate (NER) in Liberia is significantly lower than rates in Low Income Countries (LIC) in Sub-Saharan Africa. Figure 2.1 displays a persistent gap in NER from 2013 to 2015. Moreover, approximately 82 percent of primary students and 75 percent of children in Early Childhood Education (ECE) are above age for their grade levels.

Figure 2.1:
Figure 2.1:

Liberia vs Sub-Saharan Africa LIC Net Enrollment Rates

Citation: IMF Staff Country Reports 2021, 010; 10.5089/9781513566313.002.A001

Sources: MOE EMIS 2016 and World Bank databases

On a more positive note, NER was even for male and female students across all academic levels as can be seen in Figure 2.2; but nearly two thirds (61.5%) of schools do not have a library. Media centers with computers are virtually non-existent or nonfunctional. Only 58 percent of schools have latrine facilities segregated for boys and girls. At higher grade levels, retention of female students is a challenge.

Figure 2.1:
Figure 2.1:

Liberia vs Sub-Saharan Africa LIC Net Enrollment Rates

Citation: IMF Staff Country Reports 2021, 010; 10.5089/9781513566313.002.A001

Source: MOE EMIS 2016

Women remain woefully under-represented in the makeup of the instructional staff. Figure 2.3 shows overall less than 10 percent of teachers are female, creating a potentially demotivating absence of appropriate gender role models in the classroom environment during critical stages of the physical, psychological, and emotional development of girls. Figure 2.4 is organized by ownership types of schools. It shows public schools with the lowest proportion of female teachers. Figure 2.4 shows ownership of schools across all grade levels. Only 48 percent of schools are owned and operated by the government. The average number of students per teacher in public schools range from as high as 158:1 in primary grades to 93 to 1 in Senior High School. The estimated deficit of qualified public-school teachers in 2017 was 7,600.

Figure 2.3:
Figure 2.3:

Teachers by Gender by School Ownership

Citation: IMF Staff Country Reports 2021, 010; 10.5089/9781513566313.002.A001

Figure 2.4:
Figure 2.4:

Ownership of Schools

Citation: IMF Staff Country Reports 2021, 010; 10.5089/9781513566313.002.A001

To get the maximum return on investment in human capital, efforts should start in the early years of life. Early childhood is a critical developmental window when a child’s abilities or disabilities can be identified to aid further development. Early Childhood Development encompasses all aspects of children’s development including cognitive, social, emotional and physical abilities. In 2015, 13% of children aged 0–4 years were enrolled in ECD programs. Children in urban areas (19%) were more likely to receive ECD services than children in rural areas (9.8%).

In Science, Technology, Engineering, and Math (STEM) and in TVET, programs are underdeveloped, and no national qualification framework or competence-driven curriculum exists. In addition to low standards of instruction, there is a severe mismatch between disciplines pursued by students and the current and future demand for skills in the economy. Figure 2.5 shows current enrollment by discipline in TVET programs. The forecast by MOE shows a potential demand for 620,000 skilled workers to fulfill industry demand by 2030 (Table 2.6).

Figure 2.5:
Figure 2.5:

Current Enrollment by Discipline (11 most common skills)

Citation: IMF Staff Country Reports 2021, 010; 10.5089/9781513566313.002.A001

Table 2.6:

Market-Based Demand for Skills by 2030

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2.2.2 Higher Education

Thirty-four Higher Institutions of Learning (HIL) comprise the network of degree granting institutions in Liberia. Table 2.7 shows the breakout by ownership and specialization. Five are specialized institutions in health and education and one is a distance learning program. HIL will continue to face a litany of challenges throughout the near future.

Table 2.7:

Higher Institutions of Learning in Liberia

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The most fundamental of which is the ‘failure of aspiration’ of thousands of youth who graduate with the academic accreditation but cannot find suitable opportunities due to a lethargic growth of formal sector employment opportunities. Furthermore, the rapid growth in the number of privately-owned institutions have not been accompanied by significant improvement in academic standards or innovation in pedagogics. Finally, the shortage of instructional staff, infrastructure deficits, and affordability of higher education relative to the financial ability of students will continue to constrain capacity to meet the higher education needs of the country over the medium term.

Moreover, higher education studies are presented from an Anglo-Eurocentric perspective that emphasizes the culture and achievements of Westerners. This view impedes a positive view of African culture, law, and governance, that potentially thwarts national unity. In part, the limited historical and cultural relevance of higher education in Liberia underscores the lack of a common identity, which has contributed to self-inficted tragedies. While Liberians must acknowledge that the study of other nations’ historical and cultural subjects is relevant, such studies must not take precedence over a national historical and cultural perspective to educating our children about our rich triple heritage and the centrality of the unifying and transformative power of education in African societies.

Going forward, this national Development Plan (2018–2023) underscores the beginning of an audacious attempt to design and migrate to curricula of relevance or vision for modernizing both human and material resources so HIL’s can live up to both the cultural commitments, the demand for technical skills, and the demand for a more Africa regional outlook within an increasingly competitive global environment.

The autonomous National Commission on Higher Education intends to create a comprehensive and cohesive group of higher education institutions that will focus on providing the specialized skills needed by priority sectors of national development (e.g., agriculture, infrastructure, health, education, fisheries, and forestry), extend the possibilities for second chance opportunities, develop affiliated businesses that use the creative capacity of the higher education community to generate income and economic potential for the country, and enable the intellect of Liberia to apply its potential for national wealth creation and to African cultural resurgence.

2.2.3 Challenges going Forward

The challenges that will face the education sector going forward fall into three categories:

1. expanding good quality education infrastructure (including improving access to ICT for men and women)

2. improving instructional quality, impact, and achieving gender balance in the classroom

3. delivering more relevant skills to meet the demand of the growing economy and the competitive global knowledge environment.

2.2.4 Strategic Priorities for Basic Education and TVET 2018 to 2023

The complete results framework establishing targets at all education levels and the strategies for addressing the challenges over the next five years can be found in Annex I. In keeping with the principles of “leave no one behind”, the framework is structure to reflect interventions at each stage of the life cycle of Liberians. The high-level national targets are linked to the SDGs. Table 2.8 presents a framework in terms of the short to medium-term priorities in basic education and TVET; while Table 2.9 is for higher education.

Table 2.8:

Short to Medium Term Priorities for Basic Education and TVET

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Table 2.9:

Short to Medium Term Priorities in Higher Institutions of Learning

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2.2.5 Strategic Priorities for Higher Education 2018 to 2023

The government commits to reviewing the challenges of delivering Higher Education through a structured approach. In FY2018/19, a comprehensive assessment of Higher Institutions of Learning (HIL) will be completed. Thereafter, six core thrusts will be the focus of HIL over the PAPD period:

  • 1. Create a strategic, systematic, and affordable long-term plan for higher education transformation

  • 2. Reinforce the governance and management system of higher education

  • 3. Improve the cultural and economic relevance, level of capacity, accessibility, and participation in higher education; in the context of emerging demands for highly skilled and culturally-sensitive professionals in government and in the private sector

  • 4. Enhance the quality of higher education pedagogy and infrastructure to be at par with regional standards

  • 5. Rationalize the disciplines on offer and the content of degree-granting programs among the network of community colleges to make them more relevant to anticipated local demand for a mid-level professional workforce

  • 6. Build strategic partnerships with HIL overseas for the long-term growth of higher education institutions

2.3 Expanding Access to Essential Health Services

2.3.1 Improving Health Service Delivery and Infrastructure

The government recognizes that access to basic health care through the life cycle of all Liberians is a critical contributor to economic productivity and is a function of a healthy and thriving citizenry. Whether they are engaged in productive activities in the formal or informal sector, a healthy workforce is critical to the successful attainment of the Vision 2030 objective of becoming a united and prosperous nation. Moreover, to earn a substantial demographic dividend, our largely youthful population must live long, healthy, and productive lives to reach their economic potential. To this end, it is understood that access to basic health will be a fundamental contributor to the evolution of human capital that will drive our socio-economic development agenda.

Over the past decade, enormous progress has been made in the Health Sector. Significant gains were made in improving performance on major Reproductive, Maternal, Newborn, Child and Adolescent Health (RMNCAH) indicators. RMNCAH services are now available across the 15 counties. Skilled birth attendant to population is now 11.8 per 10,000 population from 4 per 1000 in 2006 (MOH); while infant mortality is now 54 per 1,000 live births, compared to 72 deaths per 1,000 live births in 2007(LDHS). Infant mortality declined from 71 deaths per 1,000 live births to 54 deaths per 1,000 live births; neonatal mortality decreased from 32 to 26, and under five mortality also decrease from 110 to 94 deaths per 1,000 live births.

Liberia had a generalized HIV epidemic with reproductive aged population showing prevalence of 2.1% (2013 LDHS) with an estimated adult HIV population of 25,000–35,000 by the end of 2015. Spectrum data estimated that 87% of the overall HIV population were adults of which 12% were aged 15–24 years. Females constituted 53% of all PLHIV in the country.32

Contraceptive prevalence increased among currently married women from 10.3 in 2007 to 19.1 percent in 2013 and among sexually active un-married women from 23.1 in 2007 to 34.6 in 2013 (LDHS). Teenage pregnancy still stands at 31 percent demanding a differentiated approach to adolescent health service. Population access to healthcare within 5KM or 1-hour walk is 71 percent--up from 41 percent in 2008 (NHPC & LDHS).

Community Health Assistance Program: Community Health Assistants (CHA’s) are delivering an integrated and standardized service delivery package, which includes curative, preventive, promotive, rehabilitative and palliative services, to households located more than one-hour walk (more than 5km) from the nearest health facility. Households located within 5km of a health facility, are receiving tailored package of services delivered by other community cadres. To date, 76.2 percent or 2,904 of the overall targeted 4,000 CHAs have been recruited, trained, and deployed in 13 counties. The CHA program is a promising approach that can, potentially, change the narrative around health care delivery in Liberia.

Communicable Diseases: Malaria is endemic, and the entire population is at risk of the disease. Children under five and pregnant women are the most affected groups. According to data from the Health Facility Survey (HFS, 2013) malaria accounted for 42 percent of outpatient department attendance and 39 percent of in-patient deaths. The total number of cases reported between 2016 and 2017, however, has fallen by nearly 29 percent from 1,517,115 to 1,069,880. TB case notifcation improved by 24 percent in 2015, thus, placing the overall notifcation at 7,119 (56%) at the end of 2016. Liberia TB treatment success rate has increased from 68 percent in 2015 to 76 percent in 2016.

The Liberia Demographic and Health Survey of 2013 (LDHS) estimates the national HIV prevalence rate among sexually-active adults (15–49 years) to be 2.1 percent, with variations based on sex, age range, geography, and socio-economic status. Leprosy is still a public health concern, with prevalence (3.61/10000) above the World Health Organization (WHO) threshold.

Prevalence of other Neglected Tropical Diseases (NTD) remains very high. Mass Drug Administration for the elimination and control is ongoing in all counties for Onchocerciasis and Soil transmitted helminths. Lymphatic Filariasis Mass Drug Administration in ongoing in 13 counties except for Bomi and Gbarpolu. Schistosomiasis Mass Drug Administration is ongoing in 13 counties except for Rivercess and Grand Kru.

Non-Communicable Diseases: Liberia has only one psychiatrist, no doctoral level psychologists, and few social workers (WHO-AIMS 2017). Liberia needs over 1,000 mental health professionals. Also, WHO estimates that Liberia needs 427 trained psychiatric nurses (9.5 for every 100,000 population). There is one psychiatric referral hospital and four Wellness Units.

Cancer remains a serious issue. Only two (2) public and one (1) private facility are currently screening for cancer. There is little or no access to chemotherapy and radiotherapy, thus rendering cancer treatment services very inadequate. Eye health is available but at a high cost in Monrovia. Outside of Monrovia limited eye care is available at a few secondary hospitals--Ganta, Phebe, Zwedru, Fishtown, Harper, Barclayville and Greenville.

Immunization: Liberia added new antigens into its routine immunization program. The antigens are Yellow Fever – 2007; Pentavalent Vaccine – 2009 replacing DPT; Pneumococcal Conjugate Vaccine – 2014; Rotavirus Containing Vaccine, RCV -2016; and Human Papillomavirus Vaccine Demonstration in Bong & Nimba Counties and Inactivated Polio Vaccine, IPV – 2017.

Drugs and Medical Supplies: Enormous progress has been made in setting into place the institutional framework for an effective supply chain management system. A temporary quality testing lab will house the Liberia Medicines and Health Products Regulatory Agency (LMHRA), while the construction of a new testing lab that meets ISO standard is being planned. A central warehouse on the outskirts of the capital is 85 percent completed with pending occupancy in June. The warehouse will receive, store and distribute medicines and medical supplies throughout the Healthcare System. The LMHRA is currently receiving and evaluating medicines and health products for registration.

Diagnostic Services: Diagnostic capacity has improved over the years. Molecular diagnostic and Microbiology techniques are up and running at the National Reference Laboratory (NRL), and at Phebe and Tappita hospitals. About 70 percent of the laboratory infrastructure at JDJ hospital has been improved. Notwithstanding, capacity for diagnostic is still limited due to a combination of infrastructure deficits, inadequate human resource and technical capacities, and inadequate or lack of modern diagnostic equipment.

Integrated Disease Surveillance and Response (IDSR): Post EVD outbreak, preventing and controlling public health threats and mitigating related risks are national priorities. Among several strategies put in place to address threats is a functional public health surveillance system with an early warning system which uses the IDSR platform. The system in managed by the newly-established National Public Health Institute of Liberia (NPHI).

Eleven of the 15 counties experienced disease outbreaks and humanitarian emergencies with the most frequent being measles (20), Lassa fever (5) and pertussis (5). The high frequency of measles outbreaks may be related to its endemicity and the high number of susceptible children in the population. Recurring outbreaks of Lassa fever were also noted particularly in Nimba and Bong counties. Two health-related emergencies involving food and mudslides in Margibi and Bong Counties as well as an incident of chemical spills in Bong County were reported.

2.3.2 Challenges going forward

Notwithstanding the foregoing, there are daunting challenges confronting the health sector that need inter-sectorial as well as multi-sectorial collaboration and investments to mitigate. Key among these challenges are:

1. High maternal and under five mortalities

2. Heavy reliance on donor financing and high out of pocket expenditure

3. Inaccessibility to healthcare for 29 percent of the population (largely rural areas)

4. A relatively large, and yet insufficient, health workforce that requires substantial investments and skills upgrading

5. Looming health threats due to diseases of epidemic potential

High maternal (774 per 100,000 live births) and under five deaths (94 per 1,000 live births) are undesirable. Government will strive to improve the current situation by investing in cost effective and sustainable strategies that will reduce mortality and the suffering of citizens.

Despite the introduction of the Essential Package of Health Services (EPHS), only 56 percent of health facilities are ready to provide services according to the general readiness index; according to the Service Availability and Readiness Assessment (SARA) 2018 survey. Despite a 15 percent increase in the number of health service delivery points from 2016 to 2018, availability of essential medicines reduced by 8 percent. Table 2.10 shows density of services per unit population.

Table 2.10:

Density of Health Services per Unit Population

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The capacity for mental health service delivery is limited. Limited skilled workforce, infrastructures, and access to psychotropic medications are among the challenges faced in effective service delivery.

Malnutrition remains a major public health concern affecting mostly children under-five. Approximately 32 per cent of children under five are stunted (short for their age), 59 per cent are micronutrient deficient, 6 per cent are wasted (thin for their height) and 5 per cent are under weight (thin for their age). The national prevalence of stunting reduced from 39.4 percent (DHS, 2007) to 32 percent (DHS,2013) and has since plateaued. The government will increase awareness and sensitization on nutrition program and scale up 10 direct nutrition interventions across the life cycle.

2.3.3 Financing Health Care Free Health Care Policy

The Free Health Care Policy is intended to deliver the EPHS free at the point of use. Nevertheless, user fees are prevalent. Among households who received health care services for the most recent visits, 58 percent paid user fees for inpatient services and 49 percent for outpatient services .33 The Free Health Care Policy offers limited protection from financial hardship due to the cost of health services and may be regressive. The prevalence of catastrophic health expenditures is twice as high for the poor than for high income earners. 15 percent of poor households incur catastrophic health expenditures compared to 8 percent for the non-poor .34

Progress has been made in pooling on-budget funding, but the arrangement remains fragmented. Efforts to channel more funding on-budget through the health sector pool fund (HSPF) has not been fully realized. Only about 20 percent of the on-budget external financing is pooled under the HSPF. The remainder is earmarked and not fungible, affecting planning and predictability. The purchasing function remains passive (WB, 2008): health facilities and staff are paid based on historical budget and are not ‘incentivized’ to deliver quality health services.

With support from the United States Agency for International Development (USAID), Fixed Amount Reimbursement Agreement (FARA) was introduced for strategic purchasing. Under FARA, reimbursements are made for the cost of providing the EPHS in three counties – Bong, Lofa, and Nimba – contingent on the fulfillment of agreed upon deliverables (MSH, 2016). The allocation of funding is neither population nor need-based fostering both unequal and inefficient service delivery. Delivering the Essential Package of Health Services

The current situation is characterized by inadequate health financing, underdeveloped health services infrastructure, a shortage of both human resources for health and essential medical supplies and limited administrative and managerial competence. These restrict health service delivery and coverage. Therefore, equity and access to quality health care remains limited. High out-of-pocket (42% of total, NHA 2013/2014) expenditure on health care especially among low income earners, generally signifes a lack of financial risk protection against catastrophic health risks for the poor.

Misallocation of resources across investment areas, counties, and healthcare functions contributes to unequal distribution of resources in the health sector (US$89 urban vs. US$32 rural per capita) --about 76 percent of resources spent on curative care and 10% on preventive care, while funding is congested at central level (RM FY 17/19). Areas such as health infrastructure, HRH, drugs & medical supplies face the biggest resource gap. Furthermore, the lack of a subsidy policy on health sector grants has misguided allocations/transfers to spending entities.

For the next 5 years, priorities under health care financing reform will involve strengthening of the public financial management system to achieve efficiency gains. It is therefore imperative to reform the Liberian Health Financing System through an alternative strategy. The Liberia Health Equity Fund (LHEF) is a proposed health financing mechanism and strategy to achieve equitable Universal Health Coverage (UHC) for Liberia (Health Sector Investment Plan 2015–2021).

2.3.4 Partnerships in Healthcare Delivery

The number of functional government facilities increased by 32 percent between 2006 and 2015; while private health facilities increased more than 40 times (by 425%). But about 200 of the 252 private health facilities in 2015 were in Montserrado county. Figure 2.6 illustrates the growing involvement of the private sector in delivering health care. Partly because of this growth in the number of private health facilities, 86 percent of the population living in urban areas lived less that one hour’s walk from a health facility by 2015—more than 4 out of every 5 city residents now live less than 40 minutes’ walk away. The challenge for city dwellers is affordability and quality.

Figure 2.6:
Figure 2.6:

Number of Health Facilities by Ownership

Citation: IMF Staff Country Reports 2021, 010; 10.5089/9781513566313.002.A001

Government acknowledges that “wastage and use of resources for purposes other than they were intended”35 and corruption remains a major impediment to improving public health service delivery-along with shortage of skilled workers and health care professionals, and a costly hospital component (38% of government funds) when most of the disease burden can be averted with community health and preventive measures. Therefore, the government sees both nonprofit and private actors as strategic partners in health service delivery well into the future and will continue to build productive relationships over the period of this NDP.

2.3.5 Strategic Priorities for Essential Health Services 2018 to 2023

To expand access to health and address persistent morbidity and mortality, the PAPD commits to increasing access to quality health care delivery, setting into place an effective and sustainable healthcare financing arrangement, and reducing morbidity and mortality with special focus on malaria (42% of morbidity) and on reproductive, maternal, newborn, child, and adolescent health (RMNCAH).

In this regard, the PAPD aims to achieve eight targets over the next five years. Table 2.11 provides a list of those targets, the corresponding SDG goals, the strategies to achieve the targets along with the sets of priority programs and activities. The corresponding results framework also includes the intersectoral linkages that will be critical to achieving the targets and can be found in Annex III. The eight targets to be achieved by 2023 are as follows:

  • 1. Reduce maternal mortality ratio from 774 to 497 per 100,000 live births

  • 2. Reduce Under-5 mortality ratio to 57 per 1000 live births

  • 3. Reduce Under-5 stunting (malnutrition) from 32 percent to 22 percent

  • 4. Reduce malaria prevalence by more than half to 20 percent

  • 5. Raise the share of rural population living within 5KM of service delivery point to 75 percent

  • 6. Ensure that ninety percent of public health facilities report no stock out of essential medicines

  • 7. Respond to 100 percent of disease outbreaks within 48 hours

  • 8. Reduce out of pocket payments to 35 percent of total health care cost through sustainable health financing mechanism.

Table 2.11:

Short to Medium Term Priorities in Providing Essential Health Services

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2.4 Ending Vulnerability and Disparity

2.4.1 Vulnerability and Inequality

To end vulnerability, and reduce gender and social inequality, the government of Liberia has passed into law, ratified, and acceded to thirty domestic and international conventions. These include:

  • 1. Constitution of the Republic of Liberia-Chapter III: Fundamental Rights

  • 2. Inheritance Act of 1998 (specifies Equal Rights in Marriage and Inheritance under Customary and Statutory Laws)

  • 3. The Rape Law of 2005

  • 4. The Anti-Human Trafficking Act of 2005

  • 5. Children’s Law of 2015

  • 6. The Adoption Law of

  • 7. Revised Act of the National Social Security and Welfare Corporation (NASSCORP) of 2017

  • 8. The African Charter on Human and People ‘s Rights and its Protocol on the Rights of Women in Africa

  • 9. AU Protocols on Children

  • 10. The New Partnership for African Development (NEPAD)

  • 11. The Solemn Declaration on Gender Equality in Africa (2004)

  • 12. African Charter on the Rights of Women in Africa 2005

  • 13. Conventions on the Elimination of All Forms of Discrimination Against Women (CEDAW and its Optional Protocol)

  • 14. Convention on the Rights of Child of (1990) and its Optional Protocol

  • 15. Convention on the Rights of Persons with Disabilities (2006)

  • 16. International Covenant on Civil and Political Rights (1966)

  • 17. International Covenant on Economic Social and Cultural Rights (1966)

  • 18. ILO Abolition of Forced Labour Convention, 1957 (No. 105)

  • 19. ILO Discrimination (Employment and Occupation) Conventions, 1958 (No. 111)

  • 20. ILO Worst Forms of Child Labour Convention, 1999 (No. 102)

  • 21. UN Security Council Resolution 1325

  • 22. UN Security Council Resolution 1820

  • 23. UN Security Council Resolution 1612 (Children and Armed Conflict)

  • 24. Beijing Declaration and Platform for Action (1995)

  • 25. International Conference on Population and Development (1994)

  • 26. United Nations Declaration on Violence Against Women (1993); MDGs (2000)

  • 27. Vienna Declaration and Program of Action in 1993

  • 28. Universal Declaration of Human Rights

  • 29. Millennium Declaration (MDGs)

  • 30. Sustainable Development Goals (SDG)

The government is committed to ensuring that all domestic policies and practices conform to the agreed values, codes, and standards contained in these commitments as well as other relevant treaties, conventions and instruments adopted through international platforms. Nevertheless, the government recognizes that fiscal space is limited; and the capacity to gather and organize impact and service delivery information in a systematic way to feed into a high-level decision-making process is also limited. Institutional knowledge and knowledge retention on the related policies and strategies are weak areas. Understanding concepts, unpacking them, and utilizing them to drive policy and strategies are specific areas that need strengthening at senior and mid management levels of the responsible MACs that are the duty-bearers of these instruments.

As a part of the effort to leave no one behind, the government sees poor, disadvantaged, and vulnerable groups in the population as part of our national assets. Fulflling government’s commitment to include them into our national development plan in substantive ways is a strategy of the PAPD. Therefore, issues concerning women and girls’ empowerment, at-risk children and youths, people with disability, people living with HIV, and EVD survivors are included in efforts to reduce absolute poverty by an additional 23 percent and widespread vulnerability over the next six years.

Similarly, investment in social protection was a new policy area injected into the AfT as part of the transition from humanitarian assistance. The experience with using this policy tool to reduce vulnerability and decrease poverty (finance, food, and fuel crisis) levels is therefore limited but evolving. The intervening EVD outbreak, saw national priorities return to life-saving humanitarian assistance, upending prospects of a smooth transition to sustainable development, and exacerbating widespread vulnerability once again. Moreover, all the SP programs under the AfT were donor-funded and delivered by the end of 2017.

No comprehensive review of the implementation of the National Social Protection Policy has been done. Nevertheless, the initial and very limited evidence available from the final evaluation of the pilot social cash transfers (SCT) to poor, food insecure, and labor constrained households in Bomi and Maryland counties, suggests that food security, health, education, and economic conditions of participating households improved markedly. Moreover, the evaluation found evidence of a multiplier effect benefiting the 52 communities and the local economies where beneficiaries reside.

2.4.2 Children Protection Improving Coverage and Targeting of Social Protection Services for Children

From 2005 to 2017, the number of orphanages in Liberia decreased from 114 to 56, with a corresponding reduction of the number of orphans from 5,000 plus to 2,251. Eight government facilities-including a transit center for children were established. Of the 8,697 children affected by the EVD outbreak, 2,310 received case management services including follow-up visits, medical, food and nonfood items and educational services. Government is committed to the policy of seeking reunifcation with family (or next of kin) as the first and best option for providing a nurturing environment for children.

Government is also committed to implementing the Child Welfare and Protection Policy and updating its accompanying 5-year plan of action. An adoption law, which protects adopted children national and internationally, has an accompanying standard operating procedure which will be followed by adoption agencies and individuals opting to access adoption services.

2.4.3 Empowering Women and Girls

Liberia ranks among the lowest 10 countries on the Gender Inequality Index (GII) reflecting pervasive disparity across political, social, and economic dimensions. There is a revised gender policy available to guide the mainstreaming of gender issues in Liberia. Several reports on the domestication and implementation of international treaties, including those related to women and girls, have been drafied and validated.

The government commits to using the findings and recommendations to inform an update to the guide to enforcing mainstreaming gender issues. Regarding SGBV, seven safe homes for survivors of gender-based violence were established and will be sustained. The legal aspects of the SGBV response is also a major component of Pillar Tree interventions. Table 2.12 shows the short, medium priority interventions for women empowerment. The entire Results Framework can be found in Annex II.

Table 2.11:

Short to Medium Term Priorities in Providing Essential Health Services

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2.4.4 Investing in Social Protection

Within the context of the PAPD, social protection (SP) is a long-term investment strategy supporting the development of Liberia’s human capital resource. The investment compliments efforts to return the economy to strong growth and yields immediate gains on efforts to reduce both poverty levels and economic inequality. Trough the social protection strategy, significant reductions will be made in every MPI indicator in every region.

The previous NDP’s achieved strong growth from a narrow economic base, realized modest reduction in poverty, but increased regional inequality. Under this NDP, the government will leverage SP investments to reduce regional inequality, unemployment and underemployment, expand access to finance for food insecure and labor constrained households, capitalize microenterprises, and stimulate local demand and supply for goods and services that can be provided by the local private sector.

The government will also leverage SP investments to address risks and vulnerability, as well as poverty through a system of cash or in-kind transfers—through both contributory and noncontributory programs. Given Liberia’s history, the government also commits to enforcement of laws that convey appropriate rights and protection to citizens with special attention given to disadvantaged groups. Global Consensus on Social Protection

Liberia is a state party to the new consensus adopted by the 100th Session of the International Labour Conference in 2011—the two-dimensional strategy on the extension of social protection. This two-dimensional approach aims at the gradual implementation of national social protection floors containing basic social security guarantees towards the realization of universal access to essential health care and income security at least at a nationally defined minimum level (horizontal dimension), in line with the Social Protection Floors Recommendation, 2012 (No. 202) , and the progressive achievement of higher levels of protection (vertical dimension) within comprehensive social security systems according to the Social Security (Minimum Standards) Convention, 1952 (No. 102).

Liberia aspires to establish a national social protection floor (SPF) comprised of the following four social security guarantees for all including special populations:

  • 1. access to essential health care, including maternity care, as addressed under the health sector interventions

  • 2. basic income security for children, providing access to nutrition, education, care and any other necessary goods and services;

  • 3. basic income security for persons in active age who are unable to earn enough income, in cases of sickness, unemployment, maternity and disability;

  • 4. basic income security for older persons.

Such guarantees will be provided progressively to all residents and all children, as defined in national laws and regulations, and subject to existing international obligations. Under the PAPD, it is important to develop a comprehensive social protection system that establishes an SPF; and progressively develops higher levels of benefits, combining different financing methods. The SPF must be adapted to Liberia’s unique socio-economic profile to ensure that no-one is lef behind. Providing Basic Income, Education, and Care for Children

The Liberia Children’s Law 2011 provides a comprehensive framework for the recognition and realization of children’s rights with respect to their protection, development, and socio-economic participation. Among others, the Children’s Law details rights to: parenthood and care; an adequate standard of living; access to medically necessary health care; access to education; access to adequate shelter, food and water. This law has however not been adequately translated into SP strategies, plans, and programs to facilitate the comprehensive attainment of its objectives.

Consistent with the access to education and health objectives of the Children’s Law, fee waivers for education and health have been instituted. Public schools are subsidized at the primary and secondary level. Families, however, remain responsible for registration fees. The registration fees typically cover the difference between the funding provided to a school by the Government, and the actual operating costs of that school (World Bank, 2012). Additional education expenses include uniforms and books. Table 2.13 shows the typical out of pocket expenses incurred by households as at 2016. The national average spent by households on school related expenses is LD 8,843 per year, which translates to more than 5 USD /month. In the poorest quintile, the expenditure amounted to LD 2,271 per year, approximately a tenth of the LD 20,000 spent by the richest quintile. Poor and food insecure households in the poorest quintiles struggle to meet this modest amount; hence they will need targeted support beyond a universal fee waiver.

Table 2.13:

Family Out of Pocket Expenses on Education in 2016

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The main social protection programs linked to children are the Liberia Social Safety Net project (LSSN) and the School Meals programs. LSSN is a cash transfer program to extremely poor and food insecure households in the counties with the highest incidences of vulnerability, namely Bomi, Maryland, Grand Kru, and River Gee. The LSSN budget amounts to 10 million USD from 2017 to 2021 (effectively), from which 8.1 million USD will be delivered as transfers to 10,000 households. The transfers will be made to the female member in each household, with the most responsibility for household spending.

Based on the economic analysis of the poverty gap and household consumption among extremely poor households, the transfer amount is pegged at between 10 USD and 34 USD per month, depending on the size of the households. In parallel to the cash transfer, the project will also develop a Social Registry targeted to register 200,000 households in the six counties in its first phase but with the objective of becoming a national household registry.

The other major social protection intervention benefiting children is the school feeding programs. Like the LSSN project, these programs are exclusively funded by donors due to limited fiscal space in the government resource envelope. Coverage of the school feeding programs currently extends to 300,000 students, a decline from the 500,000 participants in 2015. This program provides around 300,000 school meals in nine counties. It additionally, provides take-home rations to 3,000 adolescent female students.

Most classical school feeding programs have centralized food purchasing arrangements. Two projects are currently piloting the Home-Grown School Feeding (HGSF) in three districts of Nimba County, targeting 20,000 school children. The HGSF aims to utilize local farmers to provide schools with the requisite food rations. The national HGSF initiative seeks to:

  • 1. Improve food and nutrition security in vulnerable communities through increased local production and consumption of nutritious foods

  • 2. Increase farmers’ income and enhance resilience to shocks by promoting access of smallholders to production inputs and market opportunities through the home-grown school feeding program;

  • 3. Use the provision of daily school meals to increase enrolment to basic education and student retention, to ultimately gain academic performance improvements

The current planned expenditure of the school feeding program is equivalent to around 0.8 percent of GDP. Table 2.14 shows the number of beneficiaries, and expenditure of the two main child-related SP projects.

Table 2.14:

Social Safety Net and School Feeding

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Preliminary cost estimates to assess the feasibility of providing a universal school feeding to all pre-school and primary school children have been undertaken by the ILO and the government. The projected cost of this program, based on an annual cost estimate of 60 USD per child / per annum, to cover over 679,000 children by 2022, is expected to peak at 1.58% of GDP. Table 2.14a shows these estimates on an annual basis as percent of GDP.

Table 2.14-a:

ILO Universal Pre & Primary School Feeding Cost estimates

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Source: ILO calculations

In the wider context of the PAPD, scaling up the School Feeding program is considered a fundamental intervention because of its direct impact on school enrolment rate and the human development capacity of its citizens. A combination of the school feeding with local food production initiatives, is an interesting innovation which provides a multi-sectoral social protection intervention targeting school enrolment and nutritional needs for children, as well as food and income security for participating youth and working age persons. This innovation also provides an exciting prospect for developing sustainable program interventions. Providing Basic Income Security for the Working Age Population

The protection of workers from occupational disease and injury, as well as invalidity and death in service, is a key program facilitated via the 1975 and the Revised 2017 National Social Security and Welfare Act. These legislations also created the National Social Security and Welfare Corporation (NASSCORP) to administer the programs and the associated funds. Despite the Employment Injury scheme (EIS) program being mandatory, the current coverage is 125,000 workers, which only represents close to 10 percent coverage of the total labour force and around 40 percent of formal employment.37

Effective July 2018, the total contribution rate to NASSCORP will amount to 10 percent of the monthly wage, with 8 percent applied to the National Pension Scheme which provided old age, invalidity and survivors benefits, and 2 percent to the Employment Injury scheme. EIS provides participants with a maximum of 65 percent of their covered earnings in the event of a work-related accident. In case of death, the participant’s family receives a lump sum equal to 38 percent of the accrued annual old-age pension. Due to the lack of information by scheme participants, plus a cumbersome and bureaucratic claims procedure, access to EIS benefits is low. NASSCORP, workers’ organisations and employers intend to work together to overcome the present challenges to facilitate the full realisation of workers’ rights—with special attention to hazardous sectors, like rubber and mining.

The financial sustainability of NASSCORP is a key requirement to support the continued provision of contributory social protection systems. Ongoing efforts to address NASSCORP’s financial sustainability includes the mandatory undertaking of periodic actuarial valuations, strengthening institutional governance structures, and development of regulatory oversight. Institutional capacity building of NASSCORP, via MIS and human resource investments, plus the effective enforcement of contribution compliance by employers are other initiatives to improve NASSCORP’s resilience. Government has led by example to reduce its contribution arrears to NASSCORP by developing a multi-year premium re-payment schedule, as well as a commitment to ensure timely payment of currently due contributions.

According to LISGIS estimates, workers in the informal economy accounted for 78 percent of the labour force--with 80 to 90 percent in vulnerable employment situations.38 It is these informal sector workers who are most in need of predictable social protection. NASSCORP, in consultation with its stakeholders, is developing strategies and programs applicable to the informal sector. Where feasible, such programs will be linked to other PADP skills, work, and financial inclusion programs.

The Decent Work Act 2015 calls for the creation of a decent work environment in Liberia. Whilst the Decent Work Act is administered by the Ministry of Labour, the Act establishes other institutions such as a Minimum Wage Board, a National Tripartite Council, and a Labour Inspectorate to give effect to its objectives. The Decent Work Act places the responsibility for workers’ compensation in case of retirement, termination of employment, maternity and paternity, as well as work related injuries and occupational diseases, on employers.

In recognition of the complimentary objectives of the Decent Work and NASSCORP Acts, those employers who are participant in NASSCORP schemes are exempt from compliance with the Decent Work Act’s retirement, employment injury, and disease provisioning requirements. Considering the rudimentary nature of most businesses in Liberia, and the limited capacity of the Ministry of Labour to effect compliance, the government acknowledges that the protection and benefit as envisaged by the Decent Act will only take effect over the long-term. Therefore, short-term measures to extend NASSCORP’s coverage through the enforcement of registration and contribution by formal sector employers, as well as the development and implementation of adapted programs to enable the participation of workers in the informal economy, are critical to increase income security. Youth and Sports Development

The previous Youth, Employment, Skills (YES) program has since been replaced by the Youth Opportunities Project (2016–2020). The objectives of the Youth Opportunities Project (YOP) is to improve access to income generation opportunities by vulnerable youth, as well as to strengthen the government’s capacity to implement the embedded public works cash transfer program. The project will directly benefit about 15,000 targeted youth aged 15–35 years. To ensure gender mainstreaming, there is a goal of 50 percent participation rate by vulnerable female youth. In addition, the distribution of beneficiaries across urban and rural areas will be based on the proportion of total youth population in each area and prevalent poverty levels.

Adolescents aged 15–17 years in urban areas will benefit from pre-employment social support and career counselling. Youth aged 18–35 years will benefit from the business development support to household enterprises and productive public works. The public works component will ensure 100 days of work and training at 3 USD per day. The main target beneficiaries of national public works programs are vulnerable youth in rural areas.

There are several components to the YOP project. The first component is the pre-employment social support and household enterprises for urban youth. This component will contribute to addressing youth labor market participation and behavioral constraints through the following three sub-components; pre-employment social support, business development support to household enterprises, as well capacity and systems building of the YOP project.

The second YOP component is the productive public works and life skills support. This component will consist of two sub-components: roll-out and administration of productive public works as well as the provision of life skills. The third component is the capacity building for cash transfer program. This component aims to improve efficiency in the delivery of cash transfers to targeted households.39

The Youth Entrepreneurship and Employment Project (YEEP) aims to invest in the revitalization of the capacity and program design of the Technical and Vocational Education and Training (TVET) system. YEEP also aims to develop and deliver an entrepreneurship curriculum as well as to establish business incubation centres to support Small and Medium-sized Enterprises (SMEs).

The government notes that investment in social protection/labor market interventions for the youth has declined significantly and plans to reverse this experience through a combination of (entrepreneurial and labor-based) skills development, as well as public works and financial inclusion interventions. The current number of participants under the Employment Injury Scheme and the number of beneficiaries in the YOP can be seen in Table 2.15.

Table 2.15:

Current and Anticipated Beneficiaries of Working Age Population Programs

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The government also sees sports and athlete’s development as important avenues to sustainable development, as an opportunity to cut across health and education, and simultaneously contribute to the priorities identified in Pillar Tree—Sustaining the Peace and Pillar Two—Economy and Jobs. Therefore, government will restructure the under-17, under-20 and senior national teams to improve their performance and attract talented youth. Government will also build linkages to athletic programs at multilateral high schools to establish six sports academies in four regions of the country and use the investments to rehabilitate the sports infrastructures, strengthen school and grassroots community sports programs, engage nonprofit and for-profit actors in investments in athletic and sponsorship opportunities. Providing Basic Income Security Old Age Persons

The two pension systems covering private sector employees and civil servants were merged under Revised NASSCORP Act (2017).

The reform will, amongst other things, make it easier for workers to move with their accrued pension rights when changing jobs between the public and private sector. There is no data on the exact number of employer-administered occupational pension schemes currently in existence. Generally, these occupational pension schemes only exist for large (multi-national) companies. Most of the formal sector work force have no pension coverage.

As at 2015, there were 24,509 people receiving pensions from the NASSCORP administered National Pension Program as well as the Civil Service Scheme (refer Table 2.16 below). Yet according to the 2016 Household Survey, there are 163,545 people aged 60 and above in Liberia. Therefore, approximately 85 percent of people older than 60 do not receive any pension. Limited old age income security is forcing Liberians to work almost until death. According to the 2016 Household Survey, only 30.1 percent of people older than 60; 38.7 percent of people older than 70; and 41.5 percent at age 75 and above are not working.

Table 2.16:

People Receiving Pension Payments

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The impact of universal non-contributory pension programs on poverty has been found to be multi-generational as these cash transfers are shared with the larger household. Preliminary cost estimates, to assess the feasibility of implementing a universal non-contributory pension scheme in Liberia based on a prospective benefit amount of 10 USD (L$1500) per month can be seen in Table 2.16-a.

Table 2.16 – a:

ILO Universal Pension Cost Estimates (Age 70 and above)

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From these estimates, the cost of the universal pension program is expected to peak in 2022 (assuming full participation of persons who have attained the requisite age) at 0.4 percent of GDP at the qualifying age of beneficiaries set at 70 years. The implementation of universal old-age program will complement the LSSN, encourage Liberians to enrol in the national identification registry, as well as promote contributory participation in the national pension scheme for the working population. Providing Basic Income Security for Disabled Persons and People Living with HIV/AIDS

Persons with Disability (PWD) and living with HIV/AIDS (PLHIV) are most likely to fall within Liberia’s most vulnerable groups. Accurate statistics on the number of persons in Liberia is not available. Further, these statistics can vary due to the variance of concepts and classifications. Provisional estimates the disability rate in Liberia at 20 percent of the population, on the back of health, civil war, and economic related exigencies40 and 30,000 PLHIV. Te government estimates the incidence of absolute poverty among the disabled to be near 99 percent and is further compounded by structural discrimination.

Consistent with the government’s social protection objective that non-one is lef behind, it is critical to develop structured national programs to reduce acute poverty and structural discrimination experienced by the disabled. Key amongst these interventions is the introduction of a cash transfer program for the severely disabled. It is again expected that these cash benefits will benefit not only the disabled persons, but their families as well.

Economic empowerment of the disabled, constitutes a first step to counter poverty and structural discrimination. Relevant education, rehabilitation and work-related programs will also be developed in partnership with disabled persons organizations (DPOs). Table 2.16-b below depicts the projected cost of a universal cash transfers scheme to the severely disabled, with a monthly benefit amount of 10 USD (L$1,500), assuming a 1 percent severe disability rate

Table 2.16 – b:

Universal Cash Transfer Estimate (Severely Disabled Persons)

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Source: ILO calculations

2.4.5 Priorities going forward with Youth and Sports Development

Table 2.17 outlines the short, medium, and long-term priorities towards two national targets for 25,000 young people to be achieved using SP strategies under the youth and sports development programs. Two programs are currently donor funded. The full results framework is in Annex II.

Table 2.17:

Short, Medium, and Long-Term Priorities for Youths

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2.4.6 Priorities going forward with Investments in Social Protection

Universal cash transfers for children, pregnant women, persons with severe disabilities and the elderly are affordable in low income countries, costing on average 4.2 percent of GDP.41 From a Liberian perspective, cumulative cost estimates of universal cash and in-kind transfers to children, pregnant women, persons with severe disabilities, and the elderly, are estimated to start at 1 percent of GDP in 2019, peaking at 4.18 percent of GDP in 2022; when full participation is expected, and a conclusive social protection floor attained.

Achievement of Liberia’s long-term socio-economic development objectives is possible only with immediate, well-coordinated, and sustained social protection investments. The government has already operationalized the National Social Protection Steering Committee (NSPSC), whose mandate is to drive the implementation of the social protection policy agenda as well as to coordinate resource mobilization initiatives.

The NSPSC will continue to support the implementation of the PAPD. It will discharge the mandate of SPF implementation and coordination, and form the Social Protection Technical Working Group, as outlined in the PAPD framework. To guarantee the sustainability and impact of these SPF investments, the government will ensure that the related programs are well designed and coordinated to enable beneficiaries to graduate from poverty. The NSPSC will play a critical role in these respects.

Moreover, the National Commission on Disability (NCD) will be fully established, and a five-year strategic plan for the NCD elaborated. The strategic plan will draw heavily on and prioritize the implementation of the National Action Plan for inclusion of Persons with Disabilities—the key instrument domesticating the UN Convention on the Rights of Persons with Disabilities (UNCRPD).

Table 2.18 shows short, medium, and long-term priority investments towards the creation of the SP floor. The complete results framework showing 10 national targets is in Annex II. In addition to the 200,000 persons that will be enrolled in the contributory national schemes, 439,000 persons will receive assistance in cash or in kind through government and donor-funded initiatives. An additional 259,000 persons in households receiving assistance will benefit indirectly. SP-themed interventions in one form or another should impact 1.5 million Liberians by 2023.

Table 2.18:

Short, Medium, and Long-Term Priority Investments for Social Protection

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3.0 Pillar Two: The Economy and Jobs

3.1 Introduction

Pillar Two emphasizes maintaining macroeconomic stability, developing adequate infrastructure, and providing a business-friendly environment that can stimulate private investment across key sectors, with the aim of creating high-quality jobs critical to sustaining peace and long-term economic growth. This pillar describes critical interventions that the Government will pursue in the macroeconomic space to complement increased social investment in better quality education and healthcare described in Pillar One —these include interventions to help the poor lead more productive lives and increase return on investment in agriculture and in small-, medium-, and micro-enterprises.

The Government aims to improve human well-being by creating an enabling environment for growth in which the benefits are more broadly and equitably distributed over the medium to long term. Emphasis will be placed on inclusive economic growth that results in wider access to sustainable socio-economic opportunities for a greater number of people and regions, while protecting the vulnerable. All these will be achieved in an environment of fairness, equal justice, and political freedom .

3.1.1 Current State of the Economy

Challenges underpinning the prevailing state of the Liberian economy relate to economic factors and trends in the international environment. These factors are largely beyond Liberia’s control as a small open economy with high external dependency and vulnerability, making a stronger case for economic diversification.

Figure 3.1 shows favorable global market price outlook for Liberia’s main agricultural exports over the next five years and relative stability in the price of imported rice. The price of gold is expected to decline slightly but iron ore prices will decline even faster between 2018 and 2020 and will begin to rebound thereafter as can be seen in Figure 3.2. The government anticipates much of the decline in iron ore prices will be counterbalanced by new oil palm plantations coming into production and the rising price and increasing value addition in the rubber industry—offsetting any potential shock to the economy in the medium term.

Figure 3.1:
Figure 3.1:

Price Outlook for Major Agricultural Exports and Rice

Citation: IMF Staff Country Reports 2021, 010; 10.5089/9781513566313.002.A001

World Bank Commodities Price Forecast April 2018 (nominal US dollars)
Figure 3.2:
Figure 3.2:

Price Outlook for Gold, Rubber, Iron Ore

Citation: IMF Staff Country Reports 2021, 010; 10.5089/9781513566313.002.A001

World Bank Commodities Price Forecast April 2018 (nominal US dollars)

Another external factor pertains to the flow of remittances. Between 2010 and 2017, net inflows of personal remittances have shown marked volatility as explained by figure 3.3. From 2010 to 2012, net inflow increased by 123.1 percent which may partly be explained by the rebound from the global financial crisis of 2008. However, this gain was reversed in 2013 when net inflows declined by 49.3 percent. In 2014, there was an upsurge in personal net inflows probably on account of the Ebola Crisis. In the last two years personal inflows have continued to decline as shown in the chart below.

Additionally, the economy will remain susceptible to external shocks arising from volatility in the global prices of fuel and other essential consumables as well as decline of official development assistance. A weakness in the aid architecture is that a large part of donor funding has not addressed the challenges of value addition in the private sector, exposing the country to more vulnerability. Macroeconomic Outlook

The economy grew by 8.4 percent and 8.8 percent in 2013 and 2014 respectively. By 2014, the twin shocks of the EVD outbreak and plummeting global commodity prices reduced the growth rate to 0.7% in 2014 and -1.6% in 2016 before rebounding to 2.5% in 2017. Table 3.1 shows selected Financial and Economic Indicators for the period 2012 to 2017.

Table 3.1:

Selected Economic and Financial Indicators 2012 to 2017

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The agriculture and fisheries sector contribution rose from 24 to 27% of real sector GDP from 2012 to 2017. Rice yields increased from 1.5 mt/ha to 3.5 mt/ha (2011 – 2015), cassava production increased from 5.0 mt/ha to 8.0 mt/ha; while illegal fishing reduced from 83 percent to 30 percent (2009 – 2014).

Rubber, cocoa, and oil palm are major cash crops. Cocoa yields increased from 200kg to 800kg per ha from 2010 to 2017, while rubber yields reach 0.8mt/ha in 2013. The level and scale of participation of Liberian enterprises and individuals increased in value with rib smoke sheet production and exports.

In the oil palm subsector, approximately 564 thousand hectares of land have been granted (or extended) under Agricultural Concession Agreements for commercial ventures since 2008. Unfortunately, concessionaires cannot access a large fraction of these lands, risking medium term economic outlook. An additional 96 thousand hectares of land have been promised to local oil palm out-growers. As part of these arrangements, three multi-purpose and high performance (20 tons/hr.) oil processing factories are to be constructed. Nevertheless, access to the land to cultivate has been a challenge and only approximately 10 percent of the committed land has been placed under cultivation—suggesting considerable potential for long term growth still exists in this subsector.

As a major source of income, employment and livelihood in Liberia, real GDP in the forestry sector grew from 8.0 percent in 2012 to 11 percent in 2017. Slightly more than a third of Liberia’s population lives in forested areas, where forest resources provide a large share of formal employment and support informal income-generating activities, such as chainsaw milling and charcoal production. The annual revenue generated by chainsaw milling is estimated at about 3 to 4 percent of GDP. The service sector remains a major driver of growth, rising from 43 percent in 2013 to 46.3 percent of the real GDP in 2017.

Exports as percent of GDP fell from 27.6 percent in 2012 to 22.6 percent in 2014 on account of macroeconomic shocks. While the trend is downward to 2017, the effects of the rebasing of the GDP is visible in the 2016 and 2017 data. Current account balance went from negative 55.4 percent in 2014 to negative 44.1 percent of GDP in 2017. The trend can be seen in Figure 3.3. Figure 3.4 shows fluctuating but generally widening fiscal deficits from 2012 to 2017.

Figure 3.3:
Figure 3.3:

Personal Remittance Net Inflows 2010–2017

Citation: IMF Staff Country Reports 2021, 010; 10.5089/9781513566313.002.A001

Source: Central Bank of Liberia
Figure 3.4:
Figure 3.4:

Exports and Imports as Percent of GDP

Citation: IMF Staff Country Reports 2021, 010; 10.5089/9781513566313.002.A001 Constraints to Sustainable Economic Growth

Infrastructure deficits in roads, energy, transport and ICT are impinging on investment and leading to the high cost of doing business—leaving much of the population at risk of being lef behind. Additionally, Liberia’s high dependency on exports of primary commodities with limited diversification and value chain linkages impacts export earnings, reduces reserves, and worsens the current account.

A weak business and investment climate make Liberia less attractive destination for trade and investment. The business climate in Liberia has declined over the last few years, potentially delaying investments, increasing unemployment, undermining revenue generation and long-term economic growth. Addressing these policy challenges will be critical in the coming years.

An important challenge also lies in the sequencing of macroeconomic policies to address the issue of inflation and monetary depreciation, especially in Liberia’s dual currency regime. The Liberian economy over the last several years has lost a significant fraction of foreign exchange, exerting a pass-through effect on inflation, pushing prices upward as the Liberian dollar has depreciated, and increasing the cost of living for the poor. Under the PAPD, the Government aims to minimize this dynamic by striking a critical balance between monetary and fiscal policies.

Vulnerability to external shocks, incidence of natural disasters, and disease epidemics may pose threats to long term economic development and transformation in Liberia. Economic diversification, ending fragility and strengthening institutional and private sector resilience will minimize these threats, placing the Liberian economy on a more sustainable path.

Lessons learned from implementing the previous national development plan should inform how the Government addresses these challenges and constraints under the PAPD. Once resolved, observed outcomes may lie in relatively stable prices and exchange rate, reduced inflation, improved public financial management, and enhanced domestic resource mobilization and private sector competitiveness.

3.1.2 Macroeconomic Scenarios and Development Outcomes

The key development outcome for this pillar, upon unlocking these constraints, would be a stable macroeconomic environment, greater economic diversification and competitiveness, and significantly improved infrastructure. Additional outcomes will center on more effective management of natural resources and better use of technology to support growth and job creation. To achieve these outcomes, two growth scenarios are possible: i) a Business as Usual (BAU) scenario and ii) an Optimistic scenario. Business as Usual/Baseline Scenario

In the BAU scenario, no shock takes place and the path of real GDP is exogenously fixed to follow the IMF and World Bank’s medium-term forecasts. GDP growth is projected to increase from 3.0% in 2018 to 5.3% by 2023. This is underpinned by modest growth in the value of agriculture exports, fisheries, and services, and with very limited inflow of foreign direct investments. Inflation is projected to return to single digit during the last three years of the PAPD--2020–2023, on account of prudent monetary and fiscal policies. Exports are projected to increase from 12.8 percent to 14.0 percent of GDP. Trough a combination of modest recovery of commodity prices, expansion in economic activities, and implementation of a more robust domestic revenue strategy, domestic revenue is projected to increase from 13.0 percent to 15.2 percent of GDP. Annual external loan disbursement is expected to double from about US$60 million to US$120 million in the medium term. Table 3.2 shows the BAU forecasts.

Table 3.2:

BAU Forecasts of Selected Economic and Financial Indicators 2018 to 2023

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