MONROVIA, Liberia — For more than two decades, Liberia has relied on international aid to rebuild its economy following a brutal civil war and the devastation of the Ebola crisis. The United States, through the United States Agency for International Development (USAID), has been one of the country’s largest donors, providing hundreds of millions of dollars annually to support critical sectors such as education, healthcare, agriculture, and infrastructure. However, with an abrupt huge reduction in funding, the Liberian government is now shifting its focus from dependency on foreign aid to domestic revenue generation, trade, and investment.
The decline in U.S. foreign assistance began under the Trump administration, which sought to scale back global development funding. USAID had previously played a crucial role in Liberia’s economic and social recovery, funding programs that facilitated school construction, teacher training, maternal and child healthcare, and support for farmers. According to reports, USAID’s financial commitment to Liberia has ranged between $90 million and $120 million annually, making it one of the most significant sources of external funding for the nation.
The cuts have had wide-reaching implications. Liberia’s education sector, which depends heavily on foreign aid, has seen a slowdown in school development projects. Similarly, the healthcare sector, which USAID previously supported with funding for malaria prevention, HIV/AIDS treatment, and maternal health programs, is grappling with budgetary constraints. In agriculture, USAID-backed initiatives aimed at improving food security, increasing farmers’ access to capital, and enhancing mechanized farming have also been affected.
President Joseph Boakai’s administration acknowledges the challenges presented by the aid reduction but sees this as an opportunity for economic transformation. “The conversation now is shifting beyond aid to look internally at domestic revenue generation,” said Kula Fofana, Boakai’s Press Secretary. “We are focusing on making Liberia a more attractive destination for investment and trade.”
Finance and Development Planning Minister Augustine Kpehe Ngafuan has emphasized the urgent need to reprogram and redirect certain projects that are not yielding the desired returns, particularly in light of the recent reduction in USAID aid. “We are facing a significant shock due to the USAID aid cut, and immediate measures are being taken to mitigate its impact,” Minister Ngafuan told OK FM recently. He further outlined that the government is committed to addressing the gap created by the recent cancellation of USAID-funded projects through the implementation of fiscal reforms and policy measures. “We have issued fiscal rules to streamline government expenditures and have urged ministries and agencies to prioritize their priorities,” Ngafuan explained.
One of the government’s key strategies is to modernize its agricultural sector. Liberia has long depended on subsistence farming, with smallholder farmers producing low yields due to a lack of access to technology, credit, and modern farming techniques. Authorities are now pushing for large-scale mechanized agriculture and are exploring the creation of an agricultural bank to provide financial support to farmers and agribusinesses. The government also aims to boost food production, create employment opportunities, and develop a sustainable export market.
Beyond agriculture, officials are working to attract foreign investment by improving the business climate. This includes implementing policy reforms to enhance the ease of doing business, reducing bureaucratic inefficiencies, and engaging new trade partners. The government has also signaled a shift toward infrastructure development, aiming to improve roads, energy access, and industrial zones to make Liberia a more competitive destination for investors.
Despite these efforts, economic analysts warn that Liberia’s transition from aid dependency will not be without difficulties. “With the level of support USAID has provided to Liberia, this funding cut creates a huge gab,” said George Wisner, Former Head of Liberian National Investment Commission. “Losing that level of funding creates immediate fiscal pressure on critical sectors that still lack strong domestic funding mechanisms.”
To mitigate the impact, the Liberian government says it is making adjustments to its national budget, prioritizing key sectors most affected by the cuts. Government also promised Cost-cutting measures to maintain financial stability while fostering long-term economic resilience.
In addition, Liberia is looking beyond its traditional partners to new sources of investment. Officials are engaging with international financial institutions, regional trade blocs, and investors from Asia and the Middle East in hopes of diversifying economic partnerships. The administration has also initiated discussions with the African Continental Free Trade Area (AfCFTA) to explore new trade opportunities within the region.
Liberia’s journey toward economic independence will take time, but with the right policies and investment climate, the country has the potential to create a more sustainable and resilient future.
Joseph Daniels reports for OK FM Liberia as Executive Mansion Correspondent. With a vested interest in making the voices of people from different walks of life heard, he has covered investigative stories relating to education, health, the environment, corruption, and violence against women and girls, among others. He graduated from the United Methodist University with a Bachelor of Art Degree in Mass Communications in 2020. Joseph is also a fellow at New Narratives, a non-profit organization helping media deliver independent, truthful information to its people so they can make informed decisions.
