Liberia’s latest Economic Update 2025 paints a picture of a nation finding its economic footing after years of volatility.
The report, released in September 2025-shows that the country achieved notable macroeconomic stability in 2024, marked by fiscal consolidation, declining inflation, and a more balanced external position.
Yet, it also warns that job creation and structural transformation remain the weakest links in Liberia’s economic recovery.
According to the report, real GDP growth slowed slightly to 4.0 percent in 2024, down from 4.7 percent the previous year.
The slowdown was largely due to reduced industrial activity, particularly in mining and manufacturing, which offset gains in agriculture and services.
Agriculture rebounded with strong rubber and rice production, while the services sector, driven by trade, telecommunications, and financial services, remained the economy’s largest contributor.
Inflation Down, Fiscal Health Up
Inflation eased to 8.3 percent in 2024, a sharp drop from double digits in 2023, reflecting tighter monetary policy, easing global food prices, and exchange rate stability.
However, the report notes a rise in non-food inflation in the second half of the year-driven by higher costs in housing, healthcare, and education-indicating deeper structural inefficiencies in the domestic market.
On the fiscal side, Liberia’s budget deficit fell dramatically from 7.1 percent of GDP in 2023 to 2.0 percent in 2024, thanks to higher domestic revenues and cuts in recurrent spending. Total public debt edged down slightly to 57.2 percent of GDP, signaling prudent fiscal management.
“The 2025 report shows clear progress in restoring fiscal discipline and price stability,” said one economist who contributed to the study. “But for Liberia to sustain this progress, it must address the lack of productive jobs and private-sector dynamism.”
Trade Balance Improves, But Risks Linger
External accounts strengthened in 2024 as exports surged by 17 percent, led by gold, rubber, and cocoa, while imports fell by 20 percent, mainly due to lower demand for capital and fuel goods.
This combination helped halve the current account deficit to 11.2 percent of GDP, a significant turnaround for the small West African economy.
Still, the report cautions that Liberia’s export base remains narrow and commodity-dependent, leaving it exposed to fluctuations in global prices and demand.
In the financial sector, credit growth to the private sector slowed amid a rise in non-performing loans-from 17.7 percent to 21.5 percent of total loans-highlighting persistent weaknesses in lending quality. Nevertheless, banks remained liquid, well-capitalized, and profitable, signaling a stable but cautious financial environment.
Poverty Declines Slightly, But Jobs Lag Behind
Liberia’s poverty rate fell marginally from 27.5 to 26.4 percent in 2024, aided by lower inflation and moderate growth. Yet, the benefits of stability have not translated into better livelihoods for most citizens.
The report notes that 78 percent of Liberian workers remain in vulnerable, informal employment, and wage job creation remains stagnant.
Low educational attainment, limited access to finance, and a dominance of micro and informal enterprises continue to hinder productivity.
Among 40,000 firms surveyed in the 2024 National Establishment Census, 86 percent were micro-sized, and nearly nine in ten were single-person operations, underscoring the limited scale and informality of Liberia’s private sector.
A Blueprint for Job-Rich Growth
The 2025 Economic Report proposes a four-pronged approach to address Liberia’s employment challenge and sustain growth:
Stimulate labor demand by investing in agro-processing, light manufacturing, and value-added industries.
Support productive firms with better access to finance, technology, and market linkages.
Reform the business environment through legal modernization, institutional coordination, and public-private partnerships.
Expand labor participation, especially for youth and women, through targeted skills development and entrepreneurship programs.
Outlook: Growth to Strengthen, Risks Persist
Looking ahead, the report projects average GDP growth of 5.2 percent between 2025 and 2027 supported by agriculture, services, and renewed foreign investment in mining.
Inflation is expected to moderate further to 6.8 percent by 2027, while the fiscal deficit should average 2.4 percent of GDP.
However, the World Bank and local analysts warn that fiscal slippage, weak reform implementation, commodity price shocks, and declining aid flows could threaten Liberia’s economic trajectory.
“Liberia’s macroeconomic stabilization marks a crucial milestone. But stability must now evolve into inclusive, job-rich growth-one that broadens opportunities, strengthens resilience, and lifts more Liberians out of poverty.”
