Authors: Gregory Coleman and Ben Spatz
Site of publication: Global Initiative against transnational organized crime
Type of publication: Policy Brief
Date of publication: June 2022
Introduction
Complex truths regarding Liberia’s governance and political life appear to be rooted in contradictions. Liberia is both a post-conflict success story and a cautionary tale of the limits of external intervention. International pressure helped to end the civil war in 2003, and with the help of a large United Nations (UN) peacekeeping mission until 2018, peace continues to be upheld. Liberia is a post-conflict success story and a cautionary tale of the limits of external intervention. Donor assistance cleared Liberia of US$6 billion in debt, stabilizing its economy and allowing the nation to begin its recovery process. Yet, Liberia’s story is also one of stubborn underdevelopment, corruption and unfulfilled democratic promises. The country ranks 175 out of 189 states on the Human Development Index,1 it has deteriorated every year since 2015 on the Fragile States Index and remains one of the world’s most fragile states, and the Transparency International’s Corruption Perceptions Index categorizes it as ‘corrupt’, and shows worsening ranking since 2012. The 2021 Enhancing Africa’s Ability to Counter Transnational Crime (ENACT) Organised Crime Index stated that ‘ubiquitous corruption [in Liberia]…permeates state structures’.
This creates a fertile environment for organized criminal activity, which flourished in Liberia during its war years. The good news is that post-war Liberia has relatively low levels of organized criminal activity.5 The bad news is that Liberia is deemed one of the least resilient states to organized crime, as measured by its ability to withstand and disrupt criminality through political, economic, legal and social mechanisms. Furthermore, the ENACT Organised Crime Index tracks an overall decrease in Liberia’s resilience to organized crime between 2019 and 2021, in line with the majority of African States. Such low, and diminishing, resilience means that Liberia is at risk of sliding into the ‘worst possible situation’ – high criminality and low resilience.
The evolution of Liberia’s ‘fused’ political economy
Liberia’s elite-dominated post-war political economy originates from its elite-dominated history going back to its founding in 1847. Samuel Doe’s military dictatorship (1980–1990) was a new form of elite oligopoly which morphed into an internationalized war economy during years of violent conflict and state collapse (1990–1997). From 1997 to 2003, Liberia took on the characteristics of a criminalized state. This period saw the country become increasingly isolated internationally, as it was enmeshed in illicit global trade networks of arms and commodities and beset by regional violence and internal war. This paper briefly describes this history for essential context, highlighting the role of international actors and intervention in developing the current system. Liberia’s history is a reminder that despite ongoing challenges, the country has made considerable progress. Since peace has held since 2003, the rationale for ignoring corruption has weakened The post-2003 peacetime period saw Liberia’s political economy become fused to illicit activity in its current form, characterized by non-violent political activity and the manipulation of government processes to conceal untoward activity. In the years following the war, this behavior was framed as a necessary compromise to keep the peace and pursue a post-conflict state building agenda. In other words, a blind eye was turned toward corruption, as material benefits were exchanged for loyalty and support to enact reforms, pass budgets and codify legislation.14 Since peace has held since 2003, the rationale for ignoring corruption has weakened. Corruption, unconnected from larger political goals, has become increasingly brazen.
Corruption in the context of post-war institutional state-building: 2003–2017
Liberia’s civil war ended in 2003 and Ellen Johnson Sirleaf’s administration took power to much fanfare in 2006. Previously the Liberian Minister of Finance and a collaborator with the UN and World Bank, she campaigned on this experience and pledged to use international support to build a professional government that would be accountable to the Liberian people. In partnership with the international community – led by the US – she aimed to fundamentally revamp Liberia’s government institutions. This partly represented the donor community’s standard requirements of a post conflict state, but it was also a response to Liberia’s long history of institutional weakness and manipulation. Despite immense challenges, major changes were made quickly. Sirleaf took over an economy that had contracted by 90% between the mid-1980s and the mid-1990s and successfully worked to have creditors cancel Liberia’s US$5 billion debt, a necessary first step given that the Liberian government’s budget was a mere US$80 million.
From 1997 to 2003, Liberia took on the characteristics of a criminalized state. This period saw the country become increasingly isolated internationally, as it was enmeshed in illicit global trade networks of arms and commodities and beset by regional violence and internal war
The security sector was fundamentally reformed. The US led the recruitment, vetting and training of a new army, duplicative security services were eliminated or merged with existing services and a new Police Act was passed. There was a total overhaul of the extractive industries, which had been drivers of conflict. The FDA was restructured and new forestry laws, regulations and processes were established in accordance with current international best practices for timber. The diamond trade underwent a similar transition, with the government implementing systems to adhere to the Kimberly Process Certification Scheme as well as other checks. As a result, timber and diamond sanctions ended in 2006 and 2007 respectively.
Corruption in the context of enhanced state capacity: 2018 – present
Lessons on how to wield the tools of government appear to have been internalized. Liberia’s current political economy is characterized by bureaucratic processes that obscure how formal government structures are used for personal gain. Though robust on paper, the bureaucratic systems and practices established by President Sirleaf’s post-war government never obtained practical strength or became fully independent. More recently, these fledgling institutions have been gradually and systematically hollowed out. Independent oversight mechanisms and integrity agencies have been undermined, co-opted and hobbled (as this paper details in the case of President George Weah’s efforts to eliminate tenure for leaders of Liberia’s accountability institutions). The result is an opaque and weak system by design, with few avenues for accountability. Widespread corruption in the context of enhanced state capacity and absent meaningful oversight mechanisms has become a new and particularly concerning feature of the current system. This situation occupies an illicit economic sweet spot, although it is not ‘illicit’ in a conventional sense. In this context, an illicit economy 1) has limited diplomatic risk due to not relying on violence or overtly ‘criminalized’ illicit activities of concern to high profile major global players (i.e. drug trafficking, war economies, cybercrime or nuclear proliferation); 2) is easily overlooked as fraudulent government processes formally conceal illicit activities; and 3) is lucrative for those involved.
The case of ArcelorMittal, Prista Port and Solway Mining
In 2005, Dutch steel producer ArcelorMittal, the second largest in the world, obtained a concession to mine and export Liberia’s iron ore. The deal was signed by Liberia’s post-war interim government and was criticized for not adequately benefiting Liberia. There were also allegations of corruption, and the Dutch anti corruption police was concerned enough to investigate the circumstances of the contract’s award. When Ellen Johnson-Sirleaf took office in 2006, she prioritized renegotiation of the deal (along with other previously signed natural resource concessions). A renegotiated deal signed into law on 27 April 2007 granting the company a 25-year Mineral Development Agreement concession to mine in Nimba County and transport ore to the Port of Buchanan in Grand Bassa County for shipment. Since then, ArcelorMittal has been among the largest companies operating in Liberia and one of the government’s largest sources of tax revenue. In 2019, the Liberian government appears to have courted two companies – Prista Port Buchanan LLC and Solway Mining – to operate in areas that overlap with ArcelorMittal’s pre-existing concession area. Given ArcelorMittal’s relatively long history in Liberia as one of the first large-scale post-conflict mining concessions in the country, the concession’s boundaries are well known and delineated on government cadastral maps. As there are no provisions or technical standards regarding granting overlapping concessions, doing so appears to break the rules. Furthermore, there is no indication that Prista Port and Solway Mining won their concessions through an open bidding process, as set out in the PPCC Act.
Despite immense challenges, major changes were made quickly. Sirleaf took over an economy that had contracted by 90% between the mid-1980s and the mid-1990s and successfully worked to have creditors cancel Liberia’s US$5 billion debt, a necessary first step given that the Liberian government’s budget was a mere US$80 million
Undermining accountability: the case of eliminating tenure for Liberia’s integrity institutions personnel
Perhaps the most worrying current trend is the current government’s efforts to undermine accountability institutions. Just after assuming office in 2018, George Weah tried, and ultimately failed, to eliminate one of the bedrock reforms of Liberia’s post-conflict era, by pushing for a bill to remove tenure from all positions in the executive branch of government. This would have eliminated tenure of leaders of Liberia’s most politically sensitive integrity institutions such as the PPCC, LACC, LEITI, LRA, Financial Integrity Unit (FIU) and IAA. The only entities recommended to keep tenure were the Central Bank of Liberia, the National Elections Commission and the GAC. The ease and speed with which the bill passed the Liberian House before being rejected in the Senate reveals the government’s priorities. It also shows the perceived roadblocks that such institutions present for full control over Liberia’s political economy. On 30 October 2018, George Weah submitted one of his first bills to the legislature, entitled ‘An Act Prohibiting the Tenure of Public Officials within the Executive Branch of Government’. Having tenure means that individuals appointed by the President cannot be fired during their fixed term appointment, although they can be removed from their positions by the boards that directly oversee their duties. Having tenure is understood to be international best practice, especially for integrity institutions, because it provides these individuals with some insulation to make judgements based on the rule of law and not under political pressures. One of the most effective ways to undermine independent oversight mechanisms – including integrity institutions – is to eliminate the tenure of officials leading these institutions, and then place loyalists in top positions.