Liberia's economy expanded by 5.1% in 2025, but the country faced significant challenges, including a rise in extreme poverty. The World Bank's seventh Liberia Economic Update reported that extreme poverty increased from 34.6% in 2024 to 36.1% in 2025. This growth in poverty occurred despite the country's overall economic growth. The analysis, distilled into 15 findings, highlighted serious problems affecting ordinary Liberians, including poverty, unemployment, and weak agriculture.
The labor market in Liberia is characterized by insecure jobs, with about 78% of workers depending on informal businesses, self-employment, or unpaid family work. Most Liberian businesses are extremely small, with 86% being micro-enterprises and 89% operating as one-person businesses. As a result, most businesses remain too small to employ many people or grow into major companies. The analysis noted that the economy is not creating enough good jobs for young people entering the labor market.
Liberia's manufacturing and agriculture sectors faced significant challenges in 2025. Manufacturing declined by 2.8%, while agriculture grew by only 2.6%. Agricultural productivity has also been declining, with farmers struggling to produce more despite agriculture being a major source of livelihood. The country's dependence on mining has increased, with mining growing by 17% in 2025. Gold, iron ore, and rubber account for approximately 92.8% of Liberia's export earnings.
The Liberian government spent almost half a billion dollars importing food in 2025, with food imports reaching approximately $478.9 million. The analysis noted that the country continues to spend huge amounts of foreign currency buying food that it should be working to produce locally. Meanwhile, government investment in development projects fell sharply, with capital spending decreasing from $406 million in 2024 to $297 million in 2025.
The Liberian government's interest bill nearly doubled in 2025, with interest payments increasing from $49 million to $87 million. This increase in interest payments has left less room for other government priorities. The Liberia Electricity Corporation (LEC) remains financially weak, with liabilities reaching approximately 95% of its assets in 2024. The company also depends significantly on grant income and government support.
The analysis also highlighted weaknesses in the financial management of public corporations, with incomplete financial statements, limited external audits, and weaknesses in reporting. Government institutions themselves owe the electricity company millions, with approximately $34 million in unpaid electricity bills at the end of 2025. Uncertain land rights also remain a major hurdle, with approximately 85.6% of agricultural landholdings operating without formal registration.
The analysis offered five key messages for ordinary Liberians, including that growth is not the same as prosperity and that jobs are the real test of economic performance. The economy must create decent employment opportunities for new workers, and people need stable jobs, regular salaries, and reliable employment benefits. The World Bank's Liberia Economic Update provides a comprehensive assessment of the country's economic performance and highlights the need for policy reforms to address these challenges.
Key points
- Poverty in Liberia increased to 36.1% in 2025 despite economic growth.
- Insecure jobs and small businesses characterize Liberia's labor market.
- The country's dependence on mining and lack of investment in development projects are major concerns.
