Better Administering Liberia’s Mining Licensing System to Capture and Develop Natural Resources Market Forces for Inclusive Economic Growth and Jobs

In 2003, a negotiated peace ended 14 years of civil war in Liberia. The conflict had killed more than 10 percent of the prewar population and “destroyed or damaged almost all structures and institutions of the state, the economy, and everyday life” (Vinck, Pham, and Kreutzer 2011). Nearly one in two Liberians, including 45 percent of the country’s skilled workforce, had left the country (Friedman 2012), while an entire in-country generation had little access toeducation.

A goal of the elected postwar government was to rebuild the civil service. In 2011, President Johnson Sirleaf promoted an expatriate corporate lawyer, Patrick Sendolo, from head of the governance and economic management assistance program to minister of lands, mining, and energy. In 2012, Minister Sendolo began a partnership with the German Agency for International Cooperation (GIZ), the Norwegian Revenue Development Foundation (RDF), the Australian Agency for International Development (AusAID), and the World Bank Group to better manage mining contracts. Nearly 90 percent of the mining sector consisted of small-scale operations and 0.5 percent of large-scale operations (Wilson, Wang, Kabenge, and Qi 2017), and vested interests vied to retain lucrative concessions.

Between 2003 and 2015, the Liberian economy grew from US$0.4 billion to US$2 billion,1 but multidimensional poverty and near-poverty persisted in 91.5 percent of the population (United Nations Development Program 2017), and corruption in the public sector was identified by 97 percent of surveyed Liberians as a problem or a serious problem.2 This small, natural resource–rich country had transitioned to peace in the same manner as it had gone to war: with an opaque legal and regulatory system for mining that concentrated power in the executive branch and in large international investors—and failed to finance broad-based development.