Liberia is facing its dire human and economic impact, with real GDP projected to contract by 2.6 percent in 2020, according to the first Liberia Economic Update. The population living below the national poverty line is expected to increase from 55.5 percent in 2019 to 68.9 percent, which means that an additional 526,000 Liberians are at risk of falling into poverty. Economic growth could further slowdown if government’s policy response is delayed, not well-targeted, or if the external environment does not improve significantly this year.
The World Bank welcomes efforts by the Liberia authorities to manage the community spread of COVID-19, building on the lessons from the Ebola experience. iberia’s near-term outlook is highly uncertain. Under the baseline scenario, a sharp rebound is expected with real GDP growth projected to rise to an average of 4.1 percent during 2021-22. However, under the downside scenario, real GDP is expected to recover more slowly, growing at an average rate of 3.7 percent in 2021-22. In both scenarios, the medium-term recovery will be underpinned by the post-COVID-19 normalization of economic activity and the implementation of structural reforms designed to alleviate constraints on productivity growth and support economic diversification.
Policy options in four critical areas that can help Liberia lay the foundation for the recovery in the immediate and short-term: (i) scaling up social protection programs; (ii) ensuring continued access to education; (iii) promoting the continuation of essential trade and market activities; and (iv) supporting financial-sector development to bolster the response to COVID-19.