“Liberia’s stock of public debt at the end of June 2025 recorded a 1.3 percent rise to US$2,692.1 million (52.5 percent of GDP) from the stock of US$2,656.9 million (51.8 percent of GDP) in the previous quarter,” Central Bank of Liberia.
This increase, up from US$2.66 billion (51.8 percent of GDP) in the previous quarter, was largely driven by a 2.8 percent rise in external debt, which now totals US$1.62 billion, or 31.7 percent of GDP.
The CBL attributed the growth primarily to an uptick in multilateral borrowing, while domestic debt slightly declined during the period.
The report noted no change in bilateral or other external debt categories during the quarter. On a year-over-year basis, the public debt rose by 4.6 percent, also driven mainly by external debt, which grew by 8.6 percent, compared to a 0.9 percent decline in domestic debt.
In addition to the debt increase, the government significantly ramped up public expenditure in the second quarter of 2025. Total spending jumped to US$215.3 million (4.2 percent of GDP), up from US$142.6 million (2.8 percent of GDP) in the previous quarter.
Recurrent spending alone surged to US$202.3 million (4.0 percent of GDP), fueled by notable increases in goods and services, employee compensation, and debt service payments.
Spending on goods and services more than doubled, reaching US$52 million, while employee compensation rose by 26.4 percent to US$75.6 million. Meanwhile, payments on loans, interest, and other charges nearly doubled to US$46.4 million.
The CBL’s data points to a growing fiscal burden for the government, as both external borrowing and recurrent expenditures continue to rise. While the report stopped short of offering direct policy recommendations, it underscores the need for prudent debt management, especially as debt servicing costs escalate.
Economic analysts caution that if current trends persist, fiscal pressures could intensify, limiting the government’s ability to fund critical development programs and social services, particularly amid volatile revenue flows and potential external shocks.
The rise in both debt and public spending comes at a time when Liberia’s broader discussions around public financial management, transparency, and economic sustainability are taking center stage.
