Developing Public-Private Partnerships in Liberia

Abstract

The Government of Liberia is in the
 process of developing a new Poverty Reduction Strategy (PRS)
 that is intended to determine its path toward middle-income
 status. One central aspect of the strategy is likely to be a
 stronger focus on inclusive growth. This will mean that
 higher priority will be placed on growing the local private
 sector, and broadening the base of the economy.
 Public-private partnerships (PPPs) in infrastructure and
 services can be a key instrument for achieving these goals
 especially in an economy like Liberia. The analysis
 contained in this study identifies the steps toward
 establishing PPPs as both a policy instrument and method for
 deepening private sector investment in Liberia.
 Liberia's rich natural resource endowments have played
 a fundamental role in the way in which the economy has
 developed, and in the way in which Government manages
 private investment in extractive industries. The Government
 itself has a long history of entering into concession
 contracts with private investors and operators. Firestone
 rubber first signed a concession agreement in 1926, and
 re-signed their concession to last until 2041. More
 recently, the Government of Liberia has entered into several
 large natural resource and mining concession contracts that
 will see large sums of private sector capital invested
 onshore. This study is one element of a multi-faceted effort
 to support local private sector and financial sector
 development in Liberia. It takes into close account the
 Government's focus on job-creation, the post-conflict
 dynamics in the country, and Liberia's reliance on
 extractive industries as a primary source of revenue. The
 analysis also builds on previous economic sector work that
 has looked closely at how to stimulate private sector growth
 and investment, how to support small and medium-size
 enterprise (SME), and how to leverage existing private
 sector investment to generate deeper local markets and
 create new jobs.