Author: Wonderr K. Freeman

Like many countries, Liberians love rice. They can have it all day, several days, without complaints. But lately, the price and supply of rice have been shaky. The local price for rice has been stable for the past several years at $17 per 25kg sac. Lately, however, with 75% of the rice supply in Liberia coming from abroad, it’s like Liberia will either choose the price they want and accept the quantity or choose the quantity for the going price. It’s difficult to control both price and quantity in a free economy. And it’s even much more difficult to control the price and quantity of a commodity you do not produce. But when it comes to the political economy of rice in Liberia, the politics keeps getting in the way of the economics. And by politics, I mean that the current Liberian government (GOL) will continue its comical proposition that, while relying overwhelmingly on foreign farmers and suppliers, they can, meanwhile, control the rice price. So now, they have a current Commerce Minister who understands the economics and is willing to allow the price increase[1], but of course, he’s coming against a brick wall of reactionary forces at the Presidency and the National Legislature. Mr. President has contradicted the Minister on the proposed rice price[2]. And the Legislature, not wanting to be undone politically, has gone further to hold the Minister in contempt[3]. Interestingly, the very people who have the power to engender sustainable policies for Liberia’s rice troubles and who have failed to do so over the past twenty years are now holding others in contempt for doing the inevitable. “This too is Liberia!”  

Rice Issue in Liberia: A Review of the Domestic Political Economy

Let’s break down the Liberian rice problem.

Problem No. 1:            Low Production: Liberia’s core problem is they produce no more than 30% of their annual consumption[4]. This leaves a deficit of 70% that must be sourced from abroad.  

Problem No. 2:            Concentration of Supply Risk: compounding the issue of reliance on foreign sources for its staple diet, Liberia sources at least 95% of its rice imports from India[5]. Why is this a problem? It’s a concentration of risk. It is a big risk to rely on foreigners for your staple food. It is even more risky if you rely almost entirely on a single country (India).

Problem No 3:             Lack of Clear Economic Policy: The Liberian Legislature presides over the national budget and has failed miserably to do the needful. The national budget is the single most influential policy tool to promote higher-level of production of rice. But instead of promoting rice production through policies that help rice farmers and agriculture in general, our Legislators are overwhelmed by their parochial, unconstitutional, and graft-prone “legislative projects,” where funds are used in the most unaccountable and reckless manner, evading annual audit for the past eighteen years and counting. While squandering the Liberian people’s money, the same Legislature has the audacity to hold others in contempt for attempting to ameliorate the damage that eighteen years of legislative greed has wrought on the nation.  

Problem No 4:             Misplaced Priorities in Public Finance: There is a dangerous level of misplaced priorities regarding the allocation of our national budget. Whether it’s the Unity Party (UP) of Ellen Johnson-Sirleaf, the Congress for Democratic Change (CDC) of George Weah, or the current UP of Joseph Boakai, Liberia’s public finances have gone horribly wrong. Corruption, waste, abuse, and utter lack of accountability have dogged public finance in Liberia. Under the circumstances, people/agencies that don’t produce anything get the lion’s share of the budget, and those who are part of the production chain get precious little or next to nothing. How do you explain routinely giving USD10m per annum to the National Security Agency (NSA) and the Executive Protection Service (EPS), but giving on average USD 5m to the entire agricultural sector? What does this say about our national priorities? We waste our money and expect India to feed us!

Monkey work, Baboon draw; Two Faces of Indolence, Greed, and Misplaced Priorities – The Case of the Unity Party & the Congress for Democratic Change

In order to produce more rice and more food, generally, the GOL has to intervene strategically in the agricultural sector. This means helping farmers in every way possible to produce more and making it easier for them to transport and market their produce. But has that been the case over the years as power got exchanged between the UP and the CDC? Absolutely Not! The National Legislature, that is now holding the commerce minister (Modad) in contempt, continues to allocate millions and millions of dollars to themselves, while producing nothing physically. Even more sadly and irresponsibly too, they have continued to resist all calls for audit for the past eighteen years. From 2005 to the present, our National Legislature has allotted at least a billion dollars in taxpayers’ funds to themselves and has never ever been audited. Not even once. So, while proffering no solutions to the rice crisis in Liberia, they would rather grandstand politically, using their “contempt” power to harass and intimidate officials who have no option but to yield to an ostensible economic reality.

In this article, I introduce two tables that demonstrate the problem Liberia faces as it struggles to feed its 5m+ people. The tables show how the Liberian National Legislature allocates vastly more money to itself instead of allocating more money to agriculture, even though the Legislature produces nothing physical. They have yet to come up with any tangible policy to sustainably solve the rice issue. Their strategy remains the same – greed and plunder –  even as power changed hands between the UP and CDC governments. The tables show that (on average) the UP governments allocated on average 7.5% (US$45m annually) to themselves (2015-2017), while under the CDC government, 2022 – 2023, the National Legislature allocated 7.9% (US$62M annually) to themselves. Now the big question is: what did they allocate to agriculture – for more food? During the same period, the Legisature, under the CDC government, allocated, on average, only $6.3m annually to agriculture (2022-2023), constituting just about 0.8% of the total national budget (i.e., < 1%). As for the UP government, they allocated, on average, USD 9m to agriculture, constituting just about 1.5% of the total budget.

Why is agriculture that has the potential to produce something physical and more meaningful getting between <1% to 1.5% (of the national budget), but the people who are producing nothing (i.e., National Legislature) get between 7.5% to 8% of the national budget? What does this say about our priorities, as a people? With such a state of our priorities regarding our national budget, we are not going to get to the point of food security anytime soon. And sadly, the very people who are responsible for this predicament are doubling down on their malfeasance and holding innocent people in contempt for attempting to apply common sense to the rice problem. So sad. But this too is Liberia!

TABLE A

Budgetary Allocation for the Liberia National Legislature vs the Agriculture Sector	FY 2015/2016	FY 2016/2017	FY 2015 – 2017	FY 2015 – 2017
Annual Budget, Unity Party (GOL)	in millions of USD	in millions of USD	Ave 2015-2017	% Allocated/ Total budget
Total Budget	622.7	600	611.35	100%
Natl Legislature’s share	41.8	49.0	45.4	7.4%
Ministry of Agriculture’s share	4.6	8.4	6.5	1.1%
Other Agriculture Agencies’ share	1.3	3.7	2.5	0.4%
Total Agric Sector’s share	5.9	12.1	9.0	1.5%

*** National Budget FY 2015/2016 & FY 2016/2017 [Liberia] (Amounts in millions of US dollars)

TABLE B

Budgetary Allocation for the Liberia National Legislature vs the Agriculture Sector	FY 2022	FY 2023	FY 2022 – 2023	FY 2022 – 2023
Annual Budget Congress for Democratic Change (GOL)	in millions of USD	in millions of USD	Ave 2015-2017	% Allocated/ Total budget
Total Budget	786	782	784	100%
Natl Legislature’s share	64.4	60.0	62.2	7.9%
Ministry of Agriculture’s share	4.6	2.7	3.6	0.5%
Other Agriculture Agencies’ share	2.7	2.7	2.7	0.3%
Total Agric Sector’s share	7.3	5.4	6.4	0.8%

*** National Budget FY 2022 & FY 2023 [Liberia] (Amounts in millions of US dollars)

Supply-Side Policies, Gimmicks, and Mismanaged International Aid

The current administration is resorting to the usual rice politics. Face with upward pressure on the price of rice, the Joseph Boakai administration has set up a “Rice Committee” to “dismantle the “rice cartel”. How laughable! For starters, Joseph Boakai was president of the Senate from 2005 – 2017 as part of his official duties as Vice President. Every year from 2005-2017, he was present when our Legislature repeatedly carved out a lion’s share of the budget for themselves, leaving the agriculture sector to fend for itself or to rely on donors. At the time, Mr. Boakai said nothing and did nothing, even though he was reputed to be knowledgeable about agriculture and agribusiness. Now, he’s sidestepped the Ministry of Agriculture (MOA) and sidestepped the Ministry of Commerce & Industry (MOCI) to put together a “Rice Committee” headed by “political dinosaurs” to find a political solution to an economic problem. When Boakai became President, he had a second chance of doing something “big” for agriculture. But no, he won’t! This is a man who has an ingrained propensity to squander opportunities. He went right along with the business-as-usual chorus by allocating no more than 1% of the national budget to agriculture while allowing the Legislature to continue feasting on the Liberian people’s money. By contrast, in FY 1979/1980, President Tolbert’s government allocated at least USD 29.5m to the agriculture sector, representing some 9.3% of the total national budget[6]. Mr. Boakai also continued the business-as-usual posture by splashing 10’s of millions (USD) on agencies that produce nothing and are riddled with corruption, like the Ministry of State, the NSA, and the EPS. Not only is Mr. Boakai splashing 10’s of millions on non-productive agencies, but he’s also guaranteeing them freedom from audit – as he’s done with the NSA and EPS. Using the budget process, Mr. Boakai could have done more for stable rice prices and supply just by using his presidential pen. But when one is bereft of ideas, you can have the solution and still not know. So, you go for the superficial, the mundane, and the vain: Rice Committee. Of course, President Tubman did exactly that in 1968 and never succeeded[7]. What is revolutionary about another “Rice Committee”?

In terms of partially successful policies, there were the Area Development Projects (ADPs), like the LCADPs (Lofa County1 1976) and the BCADP (Bong County, 1979). These projects were focused on public sector investment to incentivize and promote supply-side growth in rice production. However, these projects were heavily donor driven. And, as is typical with donor-driven projects, if the recipient country does not take ownership and continue them on a sustainable basis, then the project(s), no matter how laudable, will end. Also, there were governance-related shortcomings, which were never corrected, causing most of these ADPs to die out with funding closures. During his tenure, ex-President Samuel K. Doe initiated his Green Revolution Policy in the 1980s, emphasizing training and skills development. However, the policy coming late in his tenure was truncated by the conflagration of the Liberian civil war, which lasted from 1989-2003.

I noted earlier how the GOL spends most of the country’s money on non-producing agencies while denying funding to the agriculture sector.  And even when foreigners come to our aid, our ministers and directors do the most dishonorable thing of squandering these opportunities, breaching contracts, and, worst of all, failing to account for donor funds. Take the case of the PL 480 Rice Support Project, funded by the United States Government (USGov). The PL-480 was the USGov way of helping Liberia stabilize the price and availability of rice on the Liberian market in the wake of the consequences of the 1979 rice riot. The idea was to have US producers sell rice to Liberia on concessional debt-financing terms. The Liberian government, for its part, was to sell the rice on the local market and deposit the funds in a special account to ensure the continued viability of the project. This was between 1980 – 1984, and the Liberia Produce Marketing Corporation (LPMC/GOL) was assigned this task. This fell into the lap of our man, “Rescue 1”, as head of LPMC and subsequently as Minister of Agriculture.  As head of the LPMC and later as Minister of Agriculture (when the audit report came out), Joseph Boakai did what he always does: squander opportunities. Instead of giving you hearsay, just read below what the 1985 audit report[8] said about LPMC/Boakai’s stewardship of the project (PL-480).

… Of the $65 million expected from rice sales, the Government of Liberia as of March 16, 1985, had not deposited sales proceeds of $16.5 million into the special account for transfer to development projects. The required special account was closed by the government.

… Government counterpart funds were limited because the Liberia Produce Marketing Corporation sold rice on credit and transferred rice to other government organizations without payment. Their weak sale and credit policies resulted in accounts receivable amounting to $14.4 million, including $7.4 million which is considered uncollectable. The Government of Liberia also failed to submit required reports on self-help measures taken pursuant to the PL480 Title I agreements

We are recommending that USAID/Liberia NOT award additional PL480 Title I, assistance until the Government of Liberia (1) reestablishes the special account, and (2) deposits the outstanding sales proceeds.

Demand-Side Policies & Agribusiness Promotion

Rice Committees, Rice Stabilization Funds, and the like policies are all window dressing. It’s the kind of dishonesty that underscores why many people dislike politicians. Stop giving Liberians the impression that there will always be cheap rice, farmed in Asia (e.g., India/China), and available for Liberians to eat. The most important part of the rice supply chain, i.e., the farming and the milling, is done in foreign countries. Consequently, you will obviously experience abrupt price changes and supply shortages because, at the international level, a hundred things might be happening that could immediately (or potentially) affect your local price or availability. For example, more recently, international trade has been affected by myriad global challenges – e.g., the Russian Aggression in Ukraine, Indian export taxes on rice, Houthis’ missiles flying over ships traversing the Suez Canal. Even if there are no man-made challenges, as noted here, there are always Acts of God, like COVID-19, which make it difficult for rice to continue to be supplied to Liberia at the same price and quantity. But admitting to this reality is not what politicians do generally, and this is even worse in Liberia.

So, while funding supply-side policies to increase local rice farming and supply, the GOLt can also shift the demand for locally-produced rice. They can pass regulations mandating that only Liberian rice be served at state functions and institutions. In a country where government spending is everything, this is a huge game-changer. With the new rules, GOL-funded institutions must now buy Liberian rice for school feeding projects, for hospitals feeding, for security forces deployment supplies, for GOL conferences/workshops, etc. A policy like this will definitely have a multiplied effect on the agriculture sector and the economy. This kind of policy is bound to incentivize private-sector investments. But of course, our Legislators are way too focused on their “legislative projects” to think about the common good. And with the average Liberian voters shuffling between two [opportunity] squanderers (i.e., UP/Boakai and CDC/Weah), it’s hard to see how such a policy can go mainstream. So, while the average voter uses her votes to elect corrupt politicians, they must suffer the consequences of high rice prices, food insecurity, and poverty. Elections have consequences; you make your choices, and you enjoy or suffer the consequences. This is not rocket science! This is just the natural law of cause and effect.

Absence of Data on the Nature & Scope of Liberia’s Problem

It’s difficult to see how Liberia can get past these difficulties. There is an absence of clear-cut economic policies aimed at food security. Worst yet, there is no data to aid policymaking. The MOA website (www.moa.gov.lr/) has no data. How do they even know the full scale of the rice problem without data? The last time I checked, their last available annual report was in 2015. For the last seven years, and probably after using at least USD 30m, there have been no annual reports. How are we going to solve a problem with no information? Why doesn’t the MOA website have live data on local agricultural produce? Why? The same thing can be said of the MOCI (www.moci.gov.lr/). The website has no updated data on local production, food prices/quantities, or international trade in general. Yet they want to convince us that they are doing their best to solve the rice problem. The last available trade bulletin is from FY 2017. It seems life ended at the Ministry of Commerce in 2018. What’s the report on Liberianization and SME promotion? It’s mandated by law. How far is it in terms of implementation?  How is it possible that MOCI has no statistics on rice consumption and production in Liberia? What’s the data on international trade statistics on rice for Liberia and food in general? President Boakai’s solution: another “Rice Committee” with trusted “political dinosaurs” at the helm. Their mission?  To rescue the rice price and stabilize the supply. I already presaged how this will end – in another failure – just like President Tubman’s “Rice Committee” of 1968. To try a policy that was tried before and failed is not business as usual; it is, in fact, worse than business as usual. Sadly, that is how far Boakai’s and his Unity Party’s ideas go. The CDC, the largest party in Parliament, like their leader, has no ideas. Check your Bible. it says: “Where the leaders lack vision, the people will NOT have rice to eat.”  

Concluding Remarks

The problem with the price of rice and its availability is not politics. It’s economics. Political grandstanding which passes for policy will not get us anywhere. Rice Committees do not work, much less to talk of rice committees spearheaded by “political dinosaurs”. Relying on foreigners to supply 70-80% of your staple diet (rice) is a recipe for continuous disruptions and price increases. Foreign aid is not sustainable and is most frequently mismanaged, as I have shown with the USGov/GOL PL-480, which was squandered between 1980-1984, by Joseph Boakai/LPMC and the GOL. The ultimate solution is to produce rice locally. But to do that, our legislature must stop being greedy. They must stop carving out a lion’s share to budget for themselves. The GOL must devise both supply-side and demand-side economic policies. Supply-side policies are intended to increase local production of rice and other food products. This could mean anything from helping farmers with equipment to improving farming skills and easing access to finance and transportation logistics for farmers.  Demand-side policies are intended to ensure that locally-produced rice is consumed all across Liberia. This may be anything bordering on demanding that institutions on government subsidy/funding procure local rice. By hyping up the demand for local rice, GOL will make the sector more profitable and ostensibly incentivize significant private-sector investment.

In terms of the don’t do’s. There are many. Specifically, instead of giving around USD 45m – 60m yearly to the National Legislature, take that money and give it to the agriculture sector, and take the agriculture sector budget (USD 6.5-9m) and give it to the Legislature. The economics behind this budgetary swap is simple and even “biblical” [see Matther 13:12]. Institutions that produce more get more funding, and those that do nothing but “blah blah blah” get less. If the President and/or Legislature are serious about solving the rice problem, then that is exactly what they should do. Even better, instead of spending USD 10-15m annually on institutions like the Ministry of State, the EPS, and the NSA, where all they do is just steal this money, save 60% or more of that money, and make it available to Liberian agribusiness entrepreneurs. Just make sure that there are productivity and accountability guarantees tagged to the requirements.

Scrap that “Rice Committees”; they are 100% guaranteed to fail. Also, end the legislative grandstanding about holding ministers in contempt. The MOCI has no power to influence the price of rice in Liberia. Mr. Amid Modad, like every other Liberian, is simply a price taker (in a market that approximates perfect competitive market models).  If anyone can actually influence the price of rice in the medium to long term, then it’s the very National Legislature and the President. And here’s what they must do:

1. Stop wasting the Liberian people’s money on fat salaries, lavish living, useless foreign trips and the 100 other wasteful and corrupt activities. Instead, put that money into sound economic policies that will increase rice production and in agribusiness. Cheap available food is an economic problem requiring an economic solution, not politics.

1. Institute accountability into your handling of government money, starting with audits, since our Legislature has been resisting audits for the past 18 years. Audit all persons who receive government funding. You can start with money-wasting agencies like the Ministry of State, the NSA, and the EPS. After the audits, cut down the budget of these crooked agencies and put the money where your mouth is (where production occurs).

And to the Liberian voters, you, too, have a role to play. You continue to vote for corrupt people (like Joseph Boakai, George Weah. Prince Y. Johnson, Jeremiah Koung, Nat McGill, Alex Tyler, etc.) and expect life to get better. This is impossible. Maybe, just maybe, higher rice/food prices may turn out to be a blessing in disguise. In a democratic society, the process of making life better for all starts with the wise use of the power to vote. The more you use your vote to elect corrupt people, the more life will get harder. This is simple logic.  There are no short-term solutions to Liberia’s rice problem. I have laid out a case of multiple medium to long term solutions. But all parties mentioned here must take that vital first step and remain on the most logical path to food security in Liberia.

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[1] See more @ https://frontpageafricaonline.com/news/liberian-government-approves-rice-price-increase-amid-importers-pressures-pledges-focus-on-local-production/

[2] See more @ https://smartnewsliberia.com/political-weight-of-rice-president-boakais-decision-and-its-implications-for-liberia/

[3] See more @ https://www.liberianobserver.com/news/house-holds-commerce-minister-modad-in-contempt/article

[4] Jeanine Bernard, 2023, Getting rice right in Liberia. Accessed online (06.01.2024) at https://www.brookings.edu/articles/getting-rice-right-in-liberia/

[5] In 2022, Liberia imported Rice primarily from: India ($121M), United States ($1.49M), Cote d’Ivoire ($1.22M), Turkey ($210k), and Brazil ($193k). Data from www.oec.world/en  

[6] David Hughes et al, 1989, Liberia Agriculture Marketing Survey, p. 83

[7] David Hughes et al, 1989, Liberia Agriculture Marketing Survey, p. 90

[8] USAID Office of Regional Inspector General for West Africa, 1985, Audit of the PL480 Title I Program

to Liberia, from 1980-1984.

Wonderr K. Freeman is a Liberian Investment Attorney, Political Economist, Accountant, and Certified Financial Crimes Specialist (CFCS) currently based in Minneapolis, USA. Mr. Freeman’s professional interests span the intersection of law and economics, including the political economy of development, economic justice, international trade/investment law, and financial crimes law. He can be reached at [email protected]. He blogs at https://wonderrfreeman.com