Despite rich natural resources (such as iron ore, rubber, timber, diamonds, gold and possible offshore deposits of crude oil) in addition to a potential for self-sufficiency in food production (such as Coffee, Cocoa, Sugarcane, Rice, Cassava and Palm Oil), Liberia’s economy deteriorated further in 2015, with a GDP growth of 0.3%, further down from 0.7% in 2014.
Productive capacity and sustained economic growth are depressed by high unemployment, low literacy, poor health, corruption, and the absence of basic infrastructure such as adequate roads and water, sewage, and electrical services.
Exploitation of gold deposits of the new gold mining concession should contribute to an increase in government revenues, employment, foreign investments and an overall recovery in Liberia’s recovery.
The organization responsible for the electricity supply industry in Liberia is the Liberia Electricity Corporation (LEC). LEC was established by the government in 1973 to produce and supply electricity to the whole country, with the responsibility to expand the system to satisfy future demand and power the expansion of industry.
The electricity sector in Liberia was severely affected during the Civil War. A large portion of the LEC generation and distribution infrastructure was damaged and destroyed during the Civil War. Despite several reforms from the Government and LEC to restore the electricity system, access to electricity remains a major challenge for many parts of Liberia.
The government introduced private sector participation reforms to boost the power sector such as the five year management contract between the LEC and Manitoba Hydro International (MHI). MHI was mandated to manage the LEC. The LEC and MHI management contract improved the electricity sector however there remains room for improvement as access to power remains a major challenge in Liberia.
The government is striving to develop and maintain an environment conducive for foreign investments. An increase in private sector participation in the generation and transmission systems as well as the management aspect of the power sector will surely increase the access of electricity and ultimately contribute to economic growth.
- The World Bank and IFC: Business Environment Snapshot for Liberia.
- The World Bank: Liberia Overview.
- The World Bank: Liberia: Power Market Structure.