Monrovia, Liberia – With its abundant natural resources, Liberia is at a turning point in its history and presents a once-in-a-lifetime chance for development and wealth. Nevertheless, demonstrations, violent disturbances, and vandalism against the foreign corporations that have the potential to influence the nation’s destiny have consistently taken center stage in the news.
However, the headlines have repeatedly featured violent disruptions, demonstrations, and destruction directed at the foreign corporations that have the potential to influence the nation’s destiny. Communities in Liberia have the right to express their concerns, and there is no proof that foreign businesses have functioned without incident.
However, it is now evident that the future of Liberia’s economy is in doubt following years of covering the country’s extractive industry and seeing significant investments being destroyed.
Liberia is in critical need of foreign direct investment (FDI) to boost economic growth, provide employment, and enhance living standards in the face of global economic difficulties.
However, the ongoing violence against businesses like Bea Mountain Mining Corporation and ArcelorMittal Liberia sends a risky message to investors: “Liberia is a high-risk environment.”
A sobering reminder of the risks that firms confront in this area is the recent armed criminals’ attack on ArcelorMittal’s Mount Yuelliton base camp.
The destruction of vital infrastructure, abuse of security forces, and suspension of operations are not isolated instances; rather, they are a part of a concerning pattern that jeopardizes Liberia’s capacity to draw in and hold on to foreign investment.
When protests broke out in Grand Cape Mount County’s Bea Mountain’s Matambo corridor in March 2024, heavy machinery was destroyed, houses were set on fire, and activities were halted.
Demands to replace the company’s non-local senior executives and claims that it had broken its Mineral Development Agreement served as the impetus for the demonstrations.
Similar to this, ArcelorMittal had difficulties in Nimba County when hidden “Country Devils” set up barriers, halting operations and harming the company’s relationships with the local population.
Workers of Margibi County’s Salala Rubber Corporation (SRC) launched a violent protest in June 2024 about subpar working conditions, destroying property and forcing the firm to close permanently, affecting over 800 jobs.
These incidents highlight how unstable Liberia’s investment environment is. Serious investors won’t risk doing business in a setting where their employees are in danger, their equipment is damaged, and their operations are constantly interrupted.
Liberia run the danger of losing potential investors to Ghana and Sierra Leone, two nearby nations where the business climate is seen as more inviting and safe, if Liberia does not address this rising insecurity.
The host communities’ intense dissatisfaction is at the core of these protests. The corporate social responsibility (CSR) funding that businesses like ArcelorMittal provide to national development do not assist these communities, which face the social and environmental costs of industrial activity.
These money are intended to be directed via the government and redistributed to the counties for development, as per Liberia’s Public Financial Management Law. However, in reality, these monies frequently fail to reach the most vulnerable areas.
A clear illustration of this failure happened in Buchanan two years ago when money meant for community development was taken and used to build a local politician’s district office. Locals believe they are not receiving their fair share of CSR monies as a result of these misappropriations, which exacerbates their animosity toward the government and companies.
The companies themselves are frequently the target of this dissatisfaction. Young people in Buchanan barricaded highways, burned tires, and blocked ArcelorMittal’s concession area last year. Similar demonstrations have occurred in Nimba County, where residents have erected barricades to prevent ArcelorMittal trains from moving.
In addition to interfering with corporate activities, these demonstrations damage Liberia’s reputation as a reliable place to invest. The government must reevaluate how it handles CSR funding in order to minimize more disruptions and safeguard Liberia’s investment future.
POSSIBLE SOLUTION
Companies should cooperate directly with host communities to decide how CSR monies are used, rather than letting them go through the federal government or county governments.
There are several important advantages to giving communities the authority to oversee their own development funding. The greatest people to choose their own development priorities are the communities who are most directly affected by industrial activity.
Giving people control over the use of CSR monies will result in more pertinent and significant initiatives, whether the focus is on clean water, improved roads, schools, or healthcare.
Money that passes through several levels of government is vulnerable to corruption and misappropriation. Businesses may guarantee the efficient and transparent use of funding by collaborating closely with local communities.
Communities are more inclined to defend and support investments when they directly benefit from them. Collaboration is encouraged by a feeling of ownership over local development, which transforms possible disagreement into a cooperative alliance, stability is necessary for investors.
Roadblocks and violence are examples of disruptions that give the impression that investing in Liberia is unsafe. The government may promote a more secure and alluring business climate by guaranteeing that CSR payments directly benefit host communities.
In order to put these reforms into effect, Liberia should enact laws requiring direct participation in CSR planning and execution by businesses and host communities, establish transparent community development funds that are overseen by representatives, local leaders, and independent oversight organizations, and mandate regular public reporting on CSR spending in order to maintain accountability and show the return on investments.
Through these actions, Liberia could switch out a system that encourages animosity and instability for one that promotes openness, trust, and long-term economic development. Businesses will be more inclined to safeguard their capital, and communities will at last get the rewards they are due.
There is no denying the link between economic success and security. Nations that maintain law and order, safeguard companies, and promote harmonious coexistence between communities and investors prosper. Liberia has the chance to go this route, but only if it is determined to protect its assets.
The Boakai government must take decisive action. Initiatives to increase investor trust must be put in place, security forces must be granted more power to respond to assaults, and laws protecting investors must be reinforced. Liberia must make it clear that business is welcome and that those who obstruct progress will face consequences.
While investors are being insulted, no progress is being made. It leads to stagnation and poverty. Those that jeopardize foreign investments endanger their future. If Liberia wants to see long-term progress, protecting investments must be its top concern. The time for change is now.
