By: Julius Konton
The International Monetary Fund (IMF) has confirmed that Liberia’s economy expanded by 5.1 percent in 2025, signaling a strengthening recovery as the country advances through its economic reform program under the Extended Credit Facility (ECF).
The confirmation follows the successful conclusion of discussions under the Third Review of Liberia’s ECF Arrangement, conducted by an IMF staff mission led by Daehaeng Kim, which visited Monrovia from January 7 to January 20, 2026.
The mission reached a staff-level agreement with the Government of Liberia, paving the way for continued IMF financial and technical support.
A Major Milestone Under the ECF Program
Liberia’s current ECF arrangement was approved by the IMF Executive Board on September 25, 2024, providing the country with access to SDR 155 million (approximately US$210 million) over a 40-month period.
The facility is designed to support macroeconomic stabilization, fiscal discipline, debt sustainability, and structural reforms in low-income countries.
The IMF’s endorsement comes at a critical time for Liberia, a nation emerging from years of economic fragility marked by the Ebola crisis, commodity price shocks, the COVID-19 pandemic, and persistent fiscal and governance challenges.
Historically dependent on primary commodities such as iron ore, rubber, and gold, Liberia has struggled to diversify its economy and stabilize public finances.
Growth Accelerates, Inflation Falls Sharply
According to the IMF, Liberia’s macroeconomic environment has improved significantly over the past year.
“Liberia’s economic and financial reforms continue to progress, supported by favorable macroeconomic outcomes,” Mr. Kim stated at the conclusion of the mission.
Real GDP growth accelerated to 5.1 percent in 2025, up from 4.0 percent in 2024, driven largely by robust mining activity, alongside moderate expansion in the agriculture and services sectors.
Mining, which accounts for a substantial share of export earnings, benefited from improved production and stronger global demand for iron ore and gold.
Inflation, a persistent challenge in recent years declined sharply, averaging 4.4 percent in the fourth quarter of 2025, down from 12.5 percent in the first quarter of the year.
The IMF attributed the decline to tighter monetary policy, improved food supply conditions, and exchange rate stability.
The Liberian dollar remained broadly stable against the U.S. dollar throughout 2025, helping to anchor inflation expectations and improve business confidence in a highly dollarized economy.
Fiscal Discipline Exceeds IMF Targets
The IMF also highlighted stronger fiscal performance, noting that Liberia exceeded key program benchmarks.
The primary fiscal surplus (excluding grants) improved from 1.3 percent of GDP in 2024 to 1.4 percent of GDP in 2025, surpassing the ECF program target of 1.1 percent of GDP.
This improvement reflects enhanced domestic revenue mobilization, tighter expenditure controls, and reforms in public financial management.
Liberia’s fiscal consolidation efforts are particularly significant given the country’s high public debt vulnerabilities, which intensified following years of emergency spending and revenue shortfalls.
Reforms Still Crucial to Long-Term Stability
Despite the positive assessment, the IMF cautioned that continued reform implementation remains essential to sustaining gains and safeguarding long-term stability.
The Fund emphasized the need for:
Prudent fiscal policies to preserve debt sustainability
Stronger domestic revenue mobilization, including tax administration reforms
Improved public financial management and transparency
Enhanced monetary policy effectiveness and a more resilient banking sector
These reforms, the IMF noted, are critical to supporting Liberia’s development priorities, reducing poverty, and attracting long-term private investments.
High-Level Engagements Signal Political Commitment
During the mission, IMF officials held consultations with President Joseph Nyuma Boakai, members of the National Legislature, Minister of Finance and Development Planning Augustine K. Ngafuan, Central Bank of Liberia Executive Governor Henry F. Saamoi, senior government officials, and development partners.
The engagements underscored the government’s commitment to the reform agenda and its alignment with broader national goals of economic stabilization, inclusive growth, and institutional strengthening.
With growth accelerating, inflation easing, and fiscal discipline improving, Liberia’s economic outlook appears cautiously optimistic.
However, analysts note that sustaining progress will depend on maintaining reform momentum, managing external shocks, and translating macroeconomic gains into jobs, infrastructure development, and improved living standards for Liberia’s nearly 5.3 million people.
As the IMF prepares to submit the third review for Executive Board consideration, Liberia stands at a pivotal moment seeking to transform recent macroeconomic stability into durable, inclusive growth after decades of economic vulnerability.
