World Bank’s Latest Report Unveils 3.5 million Liberians Live in Poverty

GERALD C. KOINYENEH

Nearly one million Liberians live in extreme poverty and 2.5 million live in absolute poverty, says the World Bank in its latest poverty assessment report on Liberia. “The report finds that nearly 6 out of every 10 Liberians live in poverty based on the national poverty line. 

And in the context of multiple crises, the plight of the poor has worsened, and the number of people in poverty has increased. Roughly 1,000,000 Liberians live in extreme poverty and 2.5 million in absolute poverty,” said Ms. Georgia Wallen, World Bank Country Manager.

Speaking at the launch of the Liberia Poverty Assessment 2023 on Monday, March 18, Ms. Wallen said while the findings of the Poverty Assessment are stark and sobering, it is the Bank’s hope they will be useful for driving intensified action to address the worsening situation of poverty facing millions of Liberians — particularly the most vulnerable.

She said the World Bank and the Government of Liberia share a common ambition, rooted in the Bank’s mission to end extreme poverty and promote shared prosperity on a livable planet.

The launch of the report comes as Liberia transitions from one administration to another, and also from one development agenda – the Pro Poor Agenda for Prosperity and Development (PAPD) to the ARREST agenda – an acronym representing Agriculture, Roads, Rule of Law, Education, Sanitation, and Tourism.

Wallen said the 2020 Liberia Poverty Assessment comes at an important time for Liberia – a moment of transition marking the early days of the new Administration with six years left for delivering on Liberia’s Vision 2030 and the target date for the Sustainable Development Goals. 

The Poverty Assessment, looking to crucial years ahead, can be valuable input for the new National Development Strategy and the Bank’s new Country Partnership Framework, she said.

The report captured that after decades of relative peace more than half of Liberia’s population still lives in poverty, reflecting the scars of a devastating civil conflict and Ebola crisis.

It noted that due to poverty being much more pervasive in rural areas, the poorest areas concentrate in the country’s interior. It added that areas in and around Monrovia are some of the least poor in the country.

The event, held at the Ellen Johnson Ministerial Complex was attended by top government officials, foreign missions and development partners.

Dehpue Zuo, deputy minister for economic management, thanked the World Bank for the report, and said it will be a resource tool for the successful implementation of the government’s ARREST program.

Factors causing poverty

With half of the population in rural areas, many of which have experienced deteriorating living standards, the Bank warned that continued disparities and inaccessibility of basic services has the potential to foster discontent among a large proportion of the Liberian population.

‘Liberia’s Stagnant Agriculture Sector’

In the report, the Bank noted that most poor Liberians depend on agriculture for their livelihoods, but the agriculture sector has exhibited sluggish and stagnant growth. Despite favorable topography and climate with plentiful rainfall for tree crops, agricultural development has not taken off – due to lack of technology, education and climate change impact.

According to the Bank, rubber concession contributed to exports and growth in the 1960s, but the benefits of these are not shared broadly across the population and can limit agricultural opportunities. Rubber concessions may not have been conducive to economic prosperity for Liberians, as the benefits of the concessions were concentrated among a few.

The report also noted that currently, up to three quarters of Liberia’s land is under some form of concession agreement; adding that while these agreements provide employment and investment in local communities, their benefits often fail to reach those not directly employed.

Moreover, expansion of concessions may deprive many Liberians of vital land resources for subsistence, exacerbate the challenges posed by limited capital since most will lack opportunities beyond agriculture.

Limited skills in industrial sector

report notes that while The the industrial sector has captured a larger share of output, its potential to reduce poverty also remains limited. The persistent absence of a dynamic and comparative manufacturing sector poses a significant obstacle to economic growth and resilience.

It further states that while the industrial sector’s contribution to GDP has surged from 4 percent in 2001 to 18 percent in 2021, the share of employment in the sector has plateaued at around 10 percent over the past decade. “This stagnation curtails the sector’s potential for reducing poverty,” the Bank said.

Low Human Capital and Access to Basic Services

The report outlined that Liberia faces a major development hurdle due to its low human capital. Liberia’s human Capital Index (HCI) currently stands at 0.32, one of the lowest in the world and much work is needed across multiple sectors to close the gap to HCI frontier.

The score means that a Liberian child born today is expected to have only 32 percent of his/her potential productivity compared to a scenario where she receives complete education and achieves full health. It added that low human capital limits the country’s progress and ability to shift from agriculture to more productive work.

“Limited access to education represents a significant obstacle to efforts to reduce poverty and build human capital.”

It notes that alarming statistics reveal that school attendance is particularly low; only two in 10 children aged six to 12 from the poorest 10 percent of the population attend school.

The report also highlights that even in the richest decile, child attendance rates barely exceed 40 percent. This dismal school enrollment trails the rest of the world regarding the number of years of school a child born today can expect to achieve by age 18.

In addition, the report revealed that the poor quality of education is also a major concern, with the country’s harmonized Test score (HTS) being among the lowest in the world (332 out of a maximum 625).

The test scores are national average scores from major international and regional student achievement testing programs (ISATs and RSATs respectively), harmonized into common units – where 300 is minimal attainment and 625 is advanced attainment.

The Bank also captured poor service delivery (health, education, clan water and sanitation). Access to electricity, although improving, but the poor are less likely to have.

Way forward

To tackle poverty, the Bank called for improved macro and fiscal stability, investment in rural areas and agriculture to combat poverty and confront climate change, improved land tenure systems and strengthen agricultural concessions, and investment in human capital.

For Wallen, she reminded her audience that Liberians should take courage in its strength, people and translating knowledge into action. She said as the world considers the intense and urgent challenges of poverty in Liberia, it should remember Liberia’s strength and the richness of its heritage.

“I want to remind us that Liberia is resource rich, with regionally and globally significant natural endowments.  I want to remind us of Liberia’s proud heritage as Africa’s first Republic.  Looking at history, Liberian women and men have distinguished themselves at the global level, with world-class achievements in spheres as diverse as international affairs, business, sports, and among many others.”

She said most recently, this country has provided an example and a beacon of hope for cherishing peace and democratic values, commanding the attention of the world.  Despite many challenges — whether longstanding impacts of civil conflict; cascading impacts of multiple recent crises; and emerging risks, such as climate change — Liberia shows potential to beat the odds.

She further noted that the large numbers can sometimes be hard to grasp, but behind the numbers are individuals.  She said the Poverty Assessment shows that the face of poverty in Liberia is a young face.

“It is more likely to be female. And it is much more likely to come from a rural area. It is the face of someone who has had little or no access to education, healthcare, and basic services like water and sanitation.”

In her third reminder, Wallen said the Poverty Assessment is about translating knowledge into action.  And working towards a more resilient and inclusive recovery from the multiple shocks over the past decade will require addressing the many structural challenges facing Liberia. 

She said increased access to quality education is essential to reversing poverty and boosting income earning potential.  In addition, efforts are also needed on the demand side to increase demand for skills labor, and Liberians wage labor market.

Building resilience to shocks, including climate related shocks is also critical. Most households lack coping mechanisms to medicate the impacts of shocks, reflecting deep vulnerability.

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