Liberia

EITI Status Meaningful progress
EITI Member Since 2009
Latest Data From 2015
Website EITI Liberia

Overview

All of Liberia’s extractive sectors suffered dramatically during the civil war that ended in 2003. The country acted as a major trader in Sierra Leonian blood diamonds and an exporter of timber which was believed to be funding Sierra Leonean rebels. UN sanctions against timber and diamonds were lifted in 2006 and 2007 respectively. Following the inauguration of the Sirleaf administration in 2006, Liberia signed several multibillion-dollar concession agreements in the iron ore and palm oil industries with numerous multinational corporations, including BHP Billiton and ArcelorMittal.

Liberia’s EITI covers the mining and timber sector as well as agriculture and the nascent oil and gas sectors. Since the first EITI report in 2009,  total government revenue reported from the extractives has been increasing from USD 29.5 million (2007-2008)  to over USD 100 million. Its latest EITI Report covering the fiscal year 2013/14 and published in July 2016 totals government revenue at around USD 148.85 million of which mining contributed 58%, oil and gas (exploration) contributed 23%, agriculture 14%  and forestry 5%. Liberia is using the EITI process innovatively to investigate key areas of concern – particularly whether contracts were allocated correctly, but also whether companies have paid what they should and whether earmarked funds were correctly allocated. The EITI multistakeholder engagement is also being used as a platform for democratic deliberations, a fertile ground upon which trust building flourishes, thus contributing to conflict prevention.

Extractive industries contribution to the economy

  • NA
    to exports
  • 15 %
    to GDP
  • 26 %
    to government revenue
  • 49 %
    to employment

Beneficial ownership disclosure

Progress on implementing beneficial ownership disclosure 

Liberia took part in the beneficial ownership pilot and attempted to obtain beneficial ownership information for active concessions as well changes in ownership in the period 2009-2011. Although several companies responded, declaring both shareholders as well as natural persons as their owners, the beneficial ownership report (annexes) does not confirm whether the natural persons disclosed were also the beneficial owners. The report includes several recommendations for improving beneficial ownership disclosure in the future.

Liberia's evaluation report from the beneficial ownership pilot explained that access to funding and obtaining information from companies were the major challenges. Liberia had agreed to include sub-contractors in its definition of beneficial owners, which proved difficult to obtain.  Prior to commencing the work on beneficial ownership, LEITI also prepared an inception report outlining the agreed definition of beneficial ownership and scope of companies covered. 

In 2017, Liberia EITI plans to, among other things, organize consultation meetings to consider the optimal institutional framework fo beneficial ownership disclosure. Read Liberia's beneficial ownership roadmap below for more information.

Trust is the greatest asset a country can have. Liberia EITI represents an important step in advancing our efforts to engage with stakeholders, to talk about our resources, and to build trust in our communities
Ellen Johnson Sirleaf, President of Liberia

Production

Since 2010 Liberia has made significant progress in reviving the mining sector, which before 1990 had contributed more than 65% of the country’s export earnings and represented about 25% of the country’s GDP.

According to the latest LEITI Report, the volume of production increased in 2014. The agricultural sector continues to be the leading contributor to growth and the mining sector’s contribution to growth continue to increase due to the recent expansion of iron ore production. Iron ore and diamonds were the main mineral products whiles round logs and rubber were the main production and export commodities in the agricultural and forestry sectors. Oil production is yet to commence.

The key export products since 2012  are iron ore, gold, diamond, rubber and round logs.

Natural resources

Liberia is rich in natural resources, notably iron ore, diamonds, gold, timber and rubber. Liberia’s undeveloped mineral resources included base metals, such as cobalt, lead, manganese, nickel, and tin, and industrial minerals, such as dolorite, granite, ilmenite, kyanite, phosphate rock, rutile, silica sand, and sulfur.

CommodityReservesUnitSignificance
OilSurveys have established the presence of essential petroleum factors in the Liberian Basin. However, until now, there has been no production of oil in the Liberian Basin.
Gold9.5 (grade 2.1 g/t) at Ndablama and Weajumetric tonsCommercial gold reserves have also been established at the New Liberty gold mine.

Revenue collection

According to the LEITI Report, government revenue from the extractive sector decreased from USD 185.96 million for the fiscal year 12/13 to USD 135.30 million for the fiscal year 13/14. This decrease amounting to USD 50.66 million (-27.24%). In that 2013/14 fiscal year, the mining sector contributed the highest revenue oil and gas sector contributed 79% of revenue from the extractive sector.

Initializing chart.

Reconciled revenues by top 5 companies

Revenue allocation

The LRA Act, section 26, states that the revenue collected by the LRA shall be paid into the Consolidated Fund. Hence, revenues from the extractive sectors are not earmarked for specific spending or regions in Liberia. The only exceptions are the company CSR contributions.

Policy recommendations and reforms

There is much public information about existing contracts and concessions in Liberia, although there are less available details on the licensing processes and procedures for allocating these contracts and licenses. A Post Award Process Audit conducted by LEITI in 2013 found that only 10% of the contracts awarded in the period between July 2009 and December 2011 were in compliance with the applicable rules. In light of these findings, LEITI's report covering the fiscal year 2012/13 found that more information on licensing processes could help to ensure that these are made in accordance with the legal frameworks. In December 2016, a Post Award Process Audit II for the period 2 January 2012 to 30 June 2015 was published. 

Innovations

The EITI encourages multi-stakeholder groups to explore innovative approaches to make the EITI more relevant and useful.

Implementation

Liberia has an impressive record of EITI implementation and has been using the process innovatively to investigate such key areas of concern – particularly whether contracts were allocated correctly, but also whether companies paid what they owed and whether earmarked funding went where it should. However, these efforts were only marginally successful in answering those broad questions since other data collection systems are weak.  

Liberia’s workplan for FY2015/16 is on track, although several of the activities outlined in the five year strategic plan remain unfunded. Liberia is aiming to produce both the 7th and 8th report together in order to improve the timeliness of its reports.

Governance 

Liberia’s EITI is governed by the 2009 LEITI Act and its regulations The LEITI has also published an MSG policy manual, a five-year strategic plan for FY2015/16-FY2019/20, a communications strategy, and an LEITI operations manual.

Timeline

Validation

Liberia's Validation against the 2016 Standard commenced on 1 July 2016.Liberia was found to have achieved meaningful progress in implementing the EITI Standard on 24th May 2017.

Liberia's progress by requirement can be found in the scorecard below. 

Liberia's progress by requirement