During an exclusive interview with New Narratives’ Anthony Stephens inside the US Embassy in Monrovia, Madam Sarah Morgenthau, said the Liberty Corridor has “potential” to “unlock significant opportunities.” Credit: US Embassy in Monrovia.

MONROVIA, Liberia—In a brief visit, Sarah Morgenthau, outgoing US President Joe Biden’s Special Representative for the Office of Commercial and Business Affairs, pressed the Liberian government to urgently improve its investment environment so the US-Liberia relationship can move more quickly to one based on investment by American companies rather than aid from the US taxpayer.

The US government provides more than $US110 million to Liberia, making it the largest donor by far to the $200 million in aid the country receives each year. Donor funding is equivalent to about 25 percent of the national budget. At the same time there are very few American companies operating in Liberia.

“We can really grow the trade and investment opportunities for Liberia, which I think are endless,” said Madam Morgenthau in an exclusive interview at the US embassy in Monrovia. The special representative’s words were given extra urgency by a weekend tweet from Elon Musk, the South African-born billionaire who has been appointed to lead a new office promising to cut $2 trillion dollars from the US government’s $7 trillion annual spending when President-elect Donald Trump takes office next month. Mr. Musk’s tweet – asking why the US spent more on aid that the next nine countries combined – signalled that US aid may be in the firing line

Governments in rich countries are growing increasingly wary of aid, especially when so much public money is being stolen. Ms. Morgenthau, who visited Liberia as a senior official at the US Peace Corps and has a long family connection to the country, urged the government to work harder to attract US companies.   

“The United States believes that we are the global partner of choice, because we deliver deals that are mutually beneficial. US companies are already here on the ground in Liberia, and we look forward to paving the way for more opportunities for US investment. US companies employ local Liberians. They partner with local Liberian businesses, and this results in workers developing transferable skills and expertise, which in turn fosters global innovation and growth.”

Investing in Liberia has been difficult for American companies. A US law known as the Foreign Corrupt Practices Act – which imposes heavy penalties on companies that are found to have engaged in corruption – has made it risky. Companies have also avoided Liberia because repeated high-profile cases have shown they cannot rely on the rule of law to protect their investments.

After the $50 million Liberia Traffic Management concession was cancelled by President Weah in 2023, one US investor told FPA/New Narratives that he would “not invest another dime in the country” because his investments were not safe from corruption.

The 2024 US State Department Investment Climate report warned:

“Liberia suffers from corruption in both the public and private sectors, which is widely viewed as the primary reason Liberia’s democracy and economy is not strengthening, why few investors come to Liberia, why jobs are not being created, and why instability is a risk.” 

A lack of infrastructure – transport, electricity and internet – has also meant foreign investment has been mostly limited to resources extraction which, on its own, creates relatively few jobs. If companies were established to process those resources in Liberia instead of shipping them overseas to process, there would be more jobs and money in the local economy.

R-L- Joseph Nyuma Boakai, Liberia’s president Mr. Robert Friedland, CEO of HPX, Mr Robert Gumede of Guma Africa Group. Credit: Executive Mansion.

In her meeting with Wilmot Paye, minister for lands, mines and energy, Madam Morgenthau urged the government to move faster on the so-called Liberty Corridor, a multi-billion-dollar project with US mining company High-Power Exploration’s (HPX) and South Africa’s Guma Group that would build a new railway from HPX’s iron ore mine in Guinea to a modern deepwater port on the Liberian coast. In February the parties signed a letter of intent with the Liberian government to “own, design, finance, develop and operate” the Corridor. A formal agreement has yet to be signed and the Liberian and Guinean governments have reportedly grown suspicious of HPX’s ability to raise the financing.  

UK-Indian steelmaking giant Arcelor Mittal and HPX have been engaged in a multi-year tussle for access to an existing rail line that Arcelor Mittal rehabilitated and uses to ship ore from its mine in Yekepa on the Liberian side of the border. Though Liberia has a policy of encouraging multi-use of the line, Arcelor Mittal’s agreement allows it to prevent any competitors causing “unreasonable interference” with its use of the railway.  

In addition to the rail line the letter of intent said the Liberty Corridor would also see “an extension of the existing hydropower network from Côte d’Ivoire into Liberia and Guinea, an upgrade of existing road networks in the Nimba district to all-weather roads and the implementation of fiber optic telecommunication cable connecting Liberia to the Nimba district and potentially beyond.”

Madam Morgenthau urged Minister Paye to resolve the obstacles so that Liberia could take advantage of regional opportunities for trade that the Corridor would offer. “Energy and digital connectivity are absolutely critical and essential for a good business environment to ensure that economies are growing, and certainly very critical to Liberia,” said Madam Morgenthau. “Projects like the multiuser rail line in Liberia have the potential to integrate the region and unlock significant opportunities. Improving the infrastructure can grow key sectors like agriculture, energy, mining serving as a catalyst for economic growth job creation and sustainable development.”

Though Liberia has seen a steady rise in the number of Liberians with access to electricity the percentage is still only 31.8 percent according to a 2022 World Bank report, one of the lowest in the world.

“Liberia making is making significant progress in renewable energy development with support from the Millennium Challenge Corporation and USAID,” said Madam Morgenthau. “These projects are crucial for sustainable development and energy diversification. US investments in infrastructures provide reliable power to thousands of Liberians. Since 2015 the United States has invested $US165 million to 11 energy infrastructure projects, and the United States’ goal is for US companies to partner with you on future mining and energy opportunities that may help supply renewable energy to the grid.”

In a WhatsApp message on Sunday, Minister Paye confirmed meeting Madam Morgenthau, but did not respond to requests for comment.

During her visit Madam Morgenthau took the opportunity to visit a special reading room at the Louis Arthur Grimes School of Law at the University of Liberia named for her mother, Ruth Schachter Morgenthau. The senior Madam Morgenthau had been a professor at Brandeis University and mentor to Olubanke King Akerele who was the first woman to serve as Liberia’s foreign minister. Madam Akerele named the room in her honor.

Madam Morgenthau, who will leave the office next month, encouraged Liberians to build on their strength and resilience in the years to come.

“I see a real energy and strength in Liberians. There’s a warmth, there’s a brilliance. Reach for the stars.”

This story was a collaboration with FrontPage Africa as part of the Investigating Liberia project. Funding came from the Swedish Embassy in Liberia. The funder had no say in the story’s content.