According to Trading Economics global macro models and analysts, Liberia’s GDP is predicted to reach 2.70 USD billion by the end of 2021. According to our econometric models, Liberia’s GDP will trend around $3.00 billion in 2022.
What is Liberia’s current economic situation?
Liberia, one of the worst-affected countries by Ebola, was still recuperating from a health disaster that claimed thousands of lives and wreaked havoc on the economy when the COVID-19 outbreak broke out. Liberia is one of the poorest countries in the world, despite its enormous natural resources and advantageous geographic location.
More than 2.2 million Liberians were unable to meet their basic food needs in 2016, with nearly 1.5 million (68 percent) living in rural areas, 1.6 million living in poverty, and 670,000 living in extreme poverty. Following the Ebola epidemic and the collapse of global commodity prices, regional and urban-rural gaps in poverty rates worsened.
Iron ore, diamonds, gold, arable soil, fisheries, and forestry are among the country’s natural resources. The economic potential of these assets, on the other hand, is mostly unexplored.
Despite hurdles, including those posed by the Covid-19 outbreak, the Liberian government, led by President George M. Weah, continues to implement his Pro-Poor Agenda for Prosperity and Development (PAPD). In October 2023, the next Presidential and Legislative Elections will be conducted.
Senatorial Special Elections in December 2020 may have given a hint as to how competitive the elections in 2023 will be.
The strengthening of the ruling coalition could be aided by a fragmented opposition coalition.
The required number of votes were not cast in a recent nationwide referendum to shorten the term of the President and members of Parliament. A dual citizenship clause for Liberians living in the diaspora was also defeated.
Liberia’s economy is growing again after two years of contraction. In 2021, real GDP is expected to grow at 3.6 percent, allowing per capita GDP to rise for the first time since 2016. Nonetheless, poverty is predicted to rise marginally as per capita consumption continues to fall, with growth driven by commodity exports.
Despite the improvement in economic activity, inflationary pressures have subsided. Because of a drop in food prices and the CBL’s cautious monetary stance, inflation slowed steadily to 7.1 percent by July 2021.
Due to increased earnings and spending consolidation, Liberia’s budgetary position improved in the first five months of 2021. Total receipts and grants totaled $249.3 million, while total expenditures totaled $286.4 million, resulting in a $37.1 million fiscal deficit (1.1 percent of GDP). The legislature has adopted a special budget to cover fiscal operations from July 1 to December 31, 2021, as required by the modified PFM act, which requires Liberia to align its fiscal year to the calendar year by 2022. Between July 1st and December 31, 2021, total revenues and grants are expected to total $429 million (12.7 percent of GDP), with domestic revenue accounting for 70% of public resources. The total budget is expected to be $458.2 million (13.6 percent of GDP, including donor-funded projects), with current spending accounting for 60% of the special budget. The special budget’s fiscal deficit is predicted to be 0.9 percent of GDP, with external borrowing expected to cover the entire gap.
In 2021, Liberia’s current account deficit is predicted to decrease. On the back of revived international demand, the price of major export commodities has recovered, boosting the value of exports and improving the trade balance.
Liberia’s GDP is expected to grow by 4.9 percent on average in 2022-23. The mining industry and external demand will be the primary drivers of growth. Mining, agriculture, and construction are projected to benefit from structural improvements. By 2023, per capita GDP should be back to pre-COVID-19 levels.
Is Liberia wealthy or impoverished?
Liberia’s economy is severely undeveloped, owing in large part to the First Liberian Civil War (19891996). Liberia is one of the world’s poorest and most underdeveloped countries.
Liberia’s economy was among the most sophisticated and fastest-growing in Sub-Saharan Africa until 1979, when it began to deteriorate after the 1980 coup d’tat, and the civil war destroyed much of the country’s economy and infrastructure, particularly in and around Monrovia. The civil war involved toppling the country’s ruling Americo-Liberian minority, which resulted in a brain drain and capital loss. Since 1997, some people have returned, but many have not.
Liberia has abundant water, mineral resources, forests, and an agriculturally conducive environment, but it lacks human capital, infrastructure, and stability. Liberia’s economy has a pretty typical Sub-Saharan African profile. The bulk of the population relies on subsistence agriculture, while basic commodities such as rubber and iron ore dominate exports. Local manufacturing, to the extent that it exists, is largely controlled by foreign investors.
The democratically elected administration, which took office in August 1997, inherited enormous international obligations and now gets the majority of its foreign exchange profits from the maritime register. The new government’s adoption of strong macro- and microeconomic policies, particularly the encouraging of foreign investment, will be critical to the rebuilding of infrastructure and increasing of incomes in this devastated economy.
What is Liberia’s unemployment rate?
Unemployment refers to the percentage of the labor force that is unemployed yet looking for job. Liberia’s unemployment rate was 3.30 percent in 2020, up 0.41 percent from 2019. Liberia’s unemployment rate was 2.89 percent in 2019, down 0.05 percent from 2018.
Which Liberian country is the largest?
Liberia is divided into fifteen counties, each of which is subdivided into 90 districts, which are then further subdivided into clans. Grand Bassa and Montserrado are the two oldest counties in Liberia, having been established in 1839 before the country’s independence. Gbarpolu is the newest county, having been established in 2001. With an area of 11,551 km2 (4,460 sq mi), Nimba is the largest of the counties, while Montserrado is the smallest at 1,909 km2 (737 sq mi). With 1,144,806 persons as of the 2008 census, Montserrado is also the most populous county in the state.
The president appoints superintendents to oversee the fifteen counties. The Constitution calls for the election of numerous chiefs at the county and local levels, but due to war and financial restrictions, these elections have not taken place since 1985.
Local and municipal divisions run parallel to the country’s administrative divisions. Liberia currently lacks a constitutional framework and standard regulations that govern the establishment and termination of local administrations. All existing local governments – cities, townships, and a borough were established by distinct acts of the Liberian government, and so each local government’s structure and duties/responsibilities differ substantially.
What is the current GDP?
Retail and wholesale trade industries led the increase in private inventory investment. The largest contributor to retail was inventory investment by automobile dealers. Increases in both products and services contributed to the increase in exports. Consumer products, industrial supplies and materials, and foods, feeds, and beverages were the biggest contributions to the growth in goods exports. Travel was the driving force behind the increase in service exports. The rise in PCE was mostly due to an increase in services, with health care, recreation, and transportation accounting for the majority of the increase. The increase in nonresidential fixed investment was mostly due to a rise in intellectual property items, which was partially offset by a drop in structures.
The reduction in federal spending was mostly due to lower defense spending on intermediate goods and services. State and local government spending fell as a result of lower consumption (driven by state and local government employee remuneration, particularly education) and gross investment (led by new educational structures). The rise in imports was mostly due to a rise in goods (led by non-food and non-automotive consumer goods, as well as capital goods).
After gaining 2.3 percent in the third quarter, real GDP increased by 6.9% in the fourth quarter. The fourth-quarter increase in real GDP was primarily due to an increase in exports, as well as increases in private inventory investment and PCE, as well as smaller decreases in residential fixed investment and federal government spending, which were partially offset by a decrease in state and local government spending. Imports have increased.
In the fourth quarter, current dollar GDP climbed 14.3% on an annual basis, or $790.1 billion, to $23.99 trillion. GDP climbed by 8.4%, or $461.3 billion, in the third quarter (table 1 and table 3).
In the fourth quarter, the price index for gross domestic purchases climbed 6.9%, compared to 5.6 percent in the third quarter (table 4). The PCE price index climbed by 6.5 percent, compared to a 5.3 percent gain in the previous quarter. The PCE price index grew 4.9 percent excluding food and energy expenses, compared to 4.6 percent overall.
Personal Income
In the fourth quarter, current-dollar personal income climbed by $106.3 billion, compared to $127.9 billion in the third quarter. Increases in compensation (driven by private earnings and salaries), personal income receipts on assets, and rental income partially offset a decline in personal current transfer receipts (particularly, government social assistance) (table 8). Following the end of pandemic-related unemployment programs, the fall in government social benefits was more than offset by a decrease in unemployment insurance.
In the fourth quarter, disposable personal income grew $14.1 billion, or 0.3 percent, compared to $36.7 billion, or 0.8 percent, in the third quarter. Real disposable personal income fell 5.8%, compared to a 4.3 percent drop in the previous quarter.
In the fourth quarter, personal savings totaled $1.34 trillion, compared to $1.72 trillion in the third quarter. In the fourth quarter, the personal saving rate (savings as a percentage of disposable personal income) was 7.4 percent, down from 9.5 percent in the third quarter.
GDP for 2021
In 2021, real GDP climbed 5.7 percent (from the 2020 annual level to the 2021 annual level), compared to a 3.4 percent fall in 2020. (table 1). In 2021, all major subcomponents of real GDP increased, led by PCE, nonresidential fixed investment, exports, residential fixed investment, and private inventory investment. Imports have risen (table 2).
PCE increased as both products and services increased in value. “Other” nondurable items (including games and toys as well as medications), apparel and footwear, and recreational goods and automobiles were the major contributors within goods. Food services and accommodations, as well as health care, were the most significant contributors to services. Increases in equipment (dominated by information processing equipment) and intellectual property items (driven by software as well as research and development) partially offset a reduction in structures in nonresidential fixed investment (widespread across most categories). The rise in exports was due to an increase in products (mostly non-automotive capital goods), which was somewhat offset by a drop in services (led by travel as well as royalties and license fees). The increase in residential fixed investment was primarily due to the development of new single-family homes. An increase in wholesale commerce led to an increase in private inventory investment (mainly in durable goods industries).
In 2021, current-dollar GDP expanded by 10.0 percent, or $2.10 trillion, to $22.99 trillion, compared to 2.2 percent, or $478.9 billion, in 2020. (tables 1 and 3).
In 2021, the price index for gross domestic purchases climbed by 3.9 percent, compared to 1.2 percent in 2020. (table 4). Similarly, the PCE price index grew 3.9 percent, compared to 1.2 percent in the previous quarter. The PCE price index climbed 3.3 percent excluding food and energy expenses, compared to 1.4 percent overall.
Real GDP rose 5.5 percent from the fourth quarter of 2020 to the fourth quarter of 2021 (table 6), compared to a 2.3 percent fall from the fourth quarter of 2019 to the fourth quarter of 2020.
From the fourth quarter of 2020 to the fourth quarter of 2021, the price index for gross domestic purchases grew 5.5 percent, compared to 1.4 percent from the fourth quarter of 2019 to the fourth quarter of 2020. The PCE price index climbed by 5.5 percent, compared to 1.2 percent for the year. The PCE price index increased 4.6 percent excluding food and energy, compared to 1.4 percent overall.
Source Data for the Advance Estimate
A Technical Note that is issued with the news release on BEA’s website contains information on the source data and major assumptions utilized in the advance estimate. Each version comes with a thorough “Key Source Data and Assumptions” file. Refer to the “Additional Details” section below for information on GDP updates.
In 2021, which country will have the greatest GDP?
What are the world’s largest economies? According to the International Monetary Fund, the following countries have the greatest nominal GDP in the world:
Is Liberia’s economy getting better?
Economic growth is predicted to recover to 3.6 percent in 2021, then steadily climbing to an average of 5.2 percent between 2022 and 2025, according to the analysis. The predicted recovery in the mining sector, bolstered by recent increases in commodity prices, will drive growth in the short run.