AFRICA

LIBERIA

UNITARY COUNTRY

BASIC SOCIO-ECONOMIC INDICATORS

INCOME GROUP: LOW INCOME

LOCAL CURRENCY: LIBERIAN DOLLAR (LRD)

POPULATION AND GEOGRAPHY

  • Area: 111 370 km2 (2018)
  • Population: 5.058 million inhabitants (2020), an increase of 2.5% per year (2015-2020)
  • Density: 45 inhabitants / km2 (2018)
  • Urban population: 52.1% of national population (2020)
  • Urban population growth: 3.3% (2020 vs 2019)
  • Capital city: Monrovia (19.2% of national population, 2020)

ECONOMIC DATA

  • GDP: 7.426 billion (current PPP international dollars), i.e., 1468 dollars per inhabitant (2020)
  • Real GDP growth: -3.0% (2020 vs 2019)
  • Unemployment rate: 4.1% (2021)
  • Foreign direct investment, net inflows (FDI): 87 (BoP, current USD millions (2020)
  • Gross Fixed Capital Formation (GFCF): Unavailable
  • HDI: 0.480 (low), ranking 175 (2019)

MAIN FEATURES OF THE MULTI-LEVEL GOVERNANCE FRAMEWORK

Liberia is a unitary, centralised constitutional republic. According to the Constitution of 1986, the authority of the government is divided among three separate, co-equal branches - the executive, the legislative and the judicial. The executive, headed by the president as head of state and government, implements the administrative, security and foreign policies of the state consistent with the laws of the republic. The president is elected by popular vote for a six-year term (renewable). The cabinet is appointed by the president and confirmed by the Senate. The legislature is composed of the Senate (30 seats; members elected by popular vote to serve nine-year terms) and the House of Representatives (73 seats; members elected by popular vote to serve six-year terms). The legislature makes the laws and passes acts for constitutional amendments, approves the budget and other expenditures of the central government and ratifies international treaties, conventions and agreements. The judiciary is the final interpreter and arbiter of legislations and executive policies and regulations to ensure their consistency with the constitution and other laws.

The local government level in Liberia is made up of counties, with authority and powers delegated by the president to oversee local government functions and service delivery by various government ministries and agencies. Counties are further partitioned into districts as an intermediate level of government. The final level of government is the municipality which consists of cities, boroughs, townships and towns. The creation of the counties was spread out over time. The first three, Montserrado, Grand Bassa and Sinoe date back to 1847. The last two current counties were created under President Charles Taylor: River Gee in 2000 and Gbarpolu in 2001. All existing local governments were created by specific acts of the Liberian government without an overall constitutional framework or uniform statutes as reference.

Following years of efforts towards decentralisation, the Local Government Act (LGA) was signed into law in 2018. The law is designed to devolve significant administrative and fiscal authorities to the counties and cities, along with the corresponding autonomies over development planning and service delivery. However, these provisions have not come into effect due to a number of political, financial and constitutional constraints.

TERRITORIAL ORGANISATION

MUNICIPAL LEVEL INTERMEDIATE LEVEL REGIONAL LEVEL TOTAL NUMBER OF SNGs (2021)
24 cities (including 15 county capitals)

126 districts
15 counties
Average municipal size:
147 864 inh.
24 126 15 165

OVERALL DESCRIPTION: The subnational organisation in Liberia is composed of 24 cities at municipal level, 126 administrative districts at intermediate level and 15 counties at regional level, totalling 165 local governments.

REGIONAL LEVEL: The county is the next level below the national government. It is governed by a county administration headed by a Superintendent and three deputies, all appointed by the president. The Local Government Act of 2018 provides for the establishment of county councils in the 15 counties, with powers including: promulgating county ordinances, rules, and regulations for the maintenance of public order and the delivery of basic public goods and services; imposing local taxes, rates duties fees and fines; approving the county development plan and the annual county budget. The county council is composed of nine members serving for a four-year term, renewable once. This provision and others in the law are yet to be implemented.

As of today, this level of government is not yet politically, administratively or fiscally autonomous from the central government. It is a means of delegating national government functions to regional entities for more effective control and better results.

INTERMEDIATE LEVEL: Each county is subdivided into smaller units known as districts. Each district is headed by a commissioner who is also appointed by the president or the minister of internal affairs acting on presidential authority, on the recommendation of the superintendent. According to the provisions of the LGA 2018, the district commissioner shall establish a seven-member district advisory council of citizens to “advise on governance, finance, budget, development, peace, security and reconciliation”. These councils are yet to be set up.

MUNICIPAL LEVEL: The last census in 2008 identified 24 cities, 15 of which are county administrative headquarters. The Liberian census and statistics authority defines a city as a settlement with 5 000 or more inhabitants. While most cities are administered by a single municipal authority, there are other self-administered satellites known as townships, or boroughs within some larger municipal conurbations. Cities, townships and boroughs are headed by city mayors, township commissioners and borough administrators, all appointed by the president with the consent of the Senate.

Though the Constitution provides for the election of municipal officials, there have been no such elections in almost 50 years. City corporations have decentralised fiscal autonomy. However, their financial management procedures and processes are not governed by a unified set of regulations, and they are not linked to the fiscal regimes required by the Public Financial Management Law, such as revenue generation and budgeting process, financial rules, regular reporting and audits.


Subnational government responsibilities

According to the Local Government Act of 2018, the central government will devolve the following responsibilities from central government ministries and agencies to county level departments: (i) planning, revenue and budget; (ii) land, environment and natural resource management; (iii) general administration and personel; (iv) public works and utilities; (v) health and social welfare, (vi) agriculture and commerce; (vii) education and sports, (viii) information, culture and tourism; (ix) community enterprise development.

This transition is taking time to put into effect. In the meantime, the county administrations are limited to the oversight of local government administration and the monitoring of services provided by central government agencies. They do not participate in the planning, budgeting and service provision, though they may be called upon to help resolve local disputes arising from the process.

Main responsibility sectors and sub-sectors

SECTORS AND SUB-SECTORS Regional level Intermediate level Municipal level
1. General public services (administration) Oversight of local government at district, municipal and town levels; coordinate/monitor services provided by central government agencies in the county Oversight of local government functions in the district; coordination of traditional authorities and customary and traditional activities parallel to state functions Management of city corporation, implementation of ordinances and support for council activities
2. Public order and safety Coordinate county security council (shared) Coordinate district security council (shared) City Police
3. Economic affairs / transports Regulation of markets and SMEs
4. Environment protection Receives report from Environmental Protection Agency Parks, solid waste management, swamps, waterways
5. Housing and community amenities
6. Health Head of county management board Head of district health management board
7. Culture & Recreation Coordinate annual county sports festival (shared) Playgrounds, beaches, bars, motels, etc.
8. Education Head of county development steering committee
9. Social Welfare Receive report on women, children and social protection


Subnational government finance

Scope of fiscal data: No available data Ministry of Finance and Development Planning Availability of fiscal data:
Low
Quality/reliability of fiscal data:
Low

GENERAL INTRODUCTION: Financial management in Liberia remains centralised. Subnational government expenditures are managed by central government ministries and agencies responsible for service provision in counties and districts. Revenue generation and budgeting for these services are also administered by central government authorities. This is why it is not possible to get fiscal data and reports outside the central government framework. This is partly a result of the centralised hierarchy and partly due to the exclusion of local government units from the public financial management architecture.

Subnational government expenditure by economic classification

ⓘ No detailed data available for this country

EXPENDITURE: The county service centres in the 15 counties that operate under the supervision of the county superintendents carry out delegated responsibilities such as the processing of certificates, licences, permits and other legitimisation documents. For this they receive transfers to cover their operating costs. These, which can be considered as intermediate consumption expenditure, amounted to about USD 200 000 (~ USD 0.5 million PPP) in the 2019-2020 fiscal year.

The salaries of county administration staff are paid directly by the ministry of internal affairs. According to the recast national budget, in FY 2019-2020, the compensation of county administration employees covered by the ministry amounted to USD 2.37 million (~ USD 5.5 million PPP).

Also, in FY 2019-2020, the central government contributed to the administration and management costs of the capital city, the Greater Monrovia District, including the Monrovia City Corporation and the Paynesville City Corporation, to the tune of about USD 3.5 million (~ USD 8.2 million PPP or USD 5.1 PPP per capita), of which around 2/3 was to cover staff costs and 1/3 was for the purchase of goods and services.

DIRECT INVESTMENT: Subnational governments in Liberia do not undertake direct investment due to legal constraints imposed by the Public Financial Management Law of 2009.

Subnational government expenditure by functional classification

ⓘ No detailed data available for this country

County and district administrations are responsible to enforce public administrative services at their respective subnational levels. The activities undertaken in this line of duty include oversight of all public services in all sectors. However, they do not make autonomous budgeting decisions, whether on forecasting and revenue collection or expenditure projections and spending. Expenditures in all the sectors are made by the central government.

Subnational government revenue by category

ⓘ No detailed data available for this country

OVERALL DESCRIPTION: For the time being, county administrations do not have authority to collect taxes, though they have such powers under the yet-to-be-implemented Local Government Act of 2018. Their current sources of revenue are government budget and in-kind grants from private sources.

The central government makes two types of indirect capital transfers to counties: one is the county development fund of USD 200 000 per county, or USD 3 million in total; the other is the social development fund that represents remittance of social corporate responsibility payments from agricultural and natural resource concessions, but which is not available to all counties. These are indirect, unrestricted and general transfers. In the context of the COVID-19 crisis, none of these transfers were made in the 2019-2020 fiscal period.

At the municipal level, the legislative charters and ordinances for municipalities provide for cities and townships to generate revenues from fees, fines, and property leases. Because the central authority responsible for local government has not issued standardised regulations for revenue generation and expenditure, there is no reporting requirement. This means there is no data on municipal revenues.

Local governments may also receive grants and subsidies in the form of in-kind goods and services provided by development organisations and businesses. Such resources must first be approved by the central government relevant sector regulating agencies.

Subnational government fiscal rules and debt

ⓘ No detailed data available for this country

FISCAL RULES: County and municipal governments do not have fiscal autonomy under the Public Financial Management Law of 2009, amended in 2020. Counties have to subscribe to new fiscal rules issued by the ministry of finance at the start of each budget year, including compliance with public procurement laws and regulations, as well as the annual budget laws.

DEBT: County and municipal governments are not allowed to enter into debt contracts, except temporary liabilities to vendors for contracts executed during each financial year. The Public Financial Management Law reserves such authority exclusively for the ministry of finance.



The impact of the COVID-19 crisis on subnational government organisation and finance

TERRITORIAL MANAGEMENT OF THE CRISIS: : When the pandemic was announced, government restrictions were imposed on public and private gatherings. All travel within red-zone counties were curtailed with a curfew, travel across all county borders were banned and international air travels were restricted to urgent diplomatic and emergency services.

A Special Presidential Advisory Committee on COVID-19 (SPACOC) was established to provide the overall policy, strategic and political direction for the COVID-19 response and recovery. The Committee headed by the president is composed of government ministries, agencies of the United Nations, the World Bank and bilateral partners.

At the county level, COVID-19 response teams were established, composed of key institutions from the health, security, local government, trade and humanitarian sectors and led by the superintendents. Each of the 15 superintendents was briefed on the medical and clinical responses of the county and district health systems, as well as receiving professional advice on informing the general public of the emergency measures required. Similar communication and coordination mechanisms were taken for the different stakeholder groups included in the COVID-19 response team.

County superintendents also supervised local joint security teams comprising police, immigration, drug enforcement and, in some cases, the military to regulate movements within each county, between counties and across international borders. Similar cooperation existed among community response teams, district commissioners, mayors, town chiefs and smaller security units in those localities. These measures were supported by Liberian and foreign aid organisations who provided direct humanitarian response and public education activities.

The administrations in red zone counties collaborated with the health systems to set up quarantine and treatment centres. Positive cases from health facilities and other locations where testing took place were transferred to the quarantine and treatment facilities. Counties not officially declared as red zones isolated confirmed cases and facilitated transfers to treatment centres in the national capital or other counties.

EMERGENCY MEASURES TO COPE WITH THE CRISIS AT THE DIFFERENT LEVELS OF GOVERNMENT: The government of Liberia and the World Food Programme collaborated to distribute emergency food aid to vulnerable population in communities that faced the greatest risks from the restrictions on movements and other aspects of the lockdown. The budgeted social stimulus spending included USD 25 million in food assistance and another USD 4 million in subsidised electricity and water.

Other types of proposed social spending included paying off bank loans owed by petty traders and street hawkers (mostly women) whose trading activities were disrupted by the restrictions on movements and closures of market places. This was included in a supplementary budget proposal submitted by the government and approved by the Legislature.

IMPACTS OF THE CRISIS ON SUBNATIONAL GOVERNMENT FINANCE: The two sources of transfers to county administrations – central government transfers and corporate social responsibility CSR) funds from companies – were impacted by the government reallocations to combat COVID-19. No money was spent for county development funds (direct government transfers) and social development funds (corporate CSRs) according to the draft national budget for the FY2020/21 of the government. In comparison, in FY2018/19, USD 1.1 million were spent for the county development fund. Both fiscal periods (2019/20 - 2020/21) present drastic cuts compared to the previous fiscal periods when the combined annual transfers for both funds averaged USD 6 to 7.5 million.

Some of the COVID-19 response measures that curtailed direct person-to-person contacts and the partial closure of local commercial activities had some impact on municipal revenue. Municipal authorities experienced reductions in the revenue they received from internally generated funds. The curfew being mostly in the major cities, fees from services such as city parking, daily market charges, and garbage collection were affected.

ECONOMIC AND SOCIAL STIMULUS PLANS: With the support of the United Nations in Liberia, a Socio-Economic Response and Recovery Plan was developed with an 18-month horizon (September 2020 – March 2022). The plan is structured around five strategic pillars: 1. Protecting health systems and services during the crisis, 2. Protecting people and basic services, 3. Economic response and recovery: Protecting jobs, SMEs and informal sector workers, 4. Macroeconomic response and multilateral collaboration, and 5. Social cohesion and community resilience. The implementation of this plan was estimated at USD 192 million.

Bibliography


Socio-economic indicators

Source Institution/Author Link
World development indicators World Bank
World population prospects United Nations
Demographic and Social Statistics United Nations
Unemployment rate by sex and age ILOSTAT
Human Development Index (HDI) United Nations Development programme; Human Development Reports
2008 National Population And Housing Census: Preliminary Results Liberia Institute of Statistics and Geo-Information Services

Socio-economic indicators

Source Institution/Author
World development indicators World Bank
Link: https://data.worldbank.org/indicator/
World population prospects United Nations
Link: https://population.un.org/wpp/
Demographic and Social Statistics United Nations
Link: https://unstats.un.org/unsd/demographic-social/index.cshtml
Unemployment rate by sex and age ILOSTAT
Link: https://ilostat.ilo.org/data/
Human Development Index (HDI) United Nations Development programme; Human Development Reports
Link: http://hdr.undp.org/en/content/human-development-index-hdi
2008 National Population And Housing Census: Preliminary Results Liberia Institute of Statistics and Geo-Information Services
Link: https://www.emansion.gov.lr/doc/census_2008provisionalresults.pdf

Fiscal data

Source Institution/Author Link
National Budget and Monthly Debt Stock Ministry of Finance & Development Planning    
Annual Report Liberia Revenue Authority

Other sources of information

Source Institution/Author Year Link
Financial Statements of the Consolidated Fund Accounts Fiscal Year 2019/20 Ministry of Finance & Development Planning 2020    
Amendment and Restatement of the Public Financial Management Act of 2009 Ministry of Finance & Development Planning 2019
Local Government Act of 2018 Ministry of Internal Affairs 2018 -
UN Liberia COVID-19 Socio-Economic Response and Recovery Plan UNDP 2020

Other sources of information

Source Institution/Author Year
Financial Statements of the Consolidated Fund Accounts Fiscal Year 2019/20 Ministry of Finance & Development Planning 2020
Link: https://www.mfdp.gov.lr/index.php/reports/consolidated-financial-statement
Link: https://www.mfdp.gov.lr/index.php/reports/consolidated-financial-statement
Amendment and Restatement of the Public Financial Management Act of 2009 Ministry of Finance & Development Planning 2019
Link: https://www.mfdp.gov.lr/index.php/docs/acts/amendment-and-restatement-of-the-public-financial-management-act-of-2009/download
Local Government Act of 2018 Ministry of Internal Affairs 2018
-
UN Liberia COVID-19 Socio-Economic Response and Recovery Plan UNDP 2020
Link: https://liberia.un.org/en/102667-un-liberia-covid-19-socio-economic-response-and-recovery-plan

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