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Liberia & Sierra Leone Country Risk Report Q4 2017

Liberia & Sierra Leone Country Risk Report Q4 2017

Core Views

Healthy remittance inflows and an ongoing recovery in iron ore outputare the two bright spots for the Liberian economy over the comingtwo years. However, we do not believe that these will be sufficientto bring headline growth anywhere near its levels of recent yearsas low iron prices and a difficult operating environment will continueto deter much-needed investment.

It is difficult to predict who will win Liberia's October 10 2017 presidentialelection given a large field and the lack of an obvious frontrunner,and we believe a second round is almost certain. Regardlessof who ultimately prevails, we expect broad policy continuity and,more importantly, broad stability in the lead up to and the aftermathof the vote.

Major Forecast Changes

No major forecast changes.


BMI Index
BMI Risk Index – Liberia
BMI Risk Index – Sierra Leone
Executive Summary – Liberia
Core Views
Major Forecast Changes
Key Risks
Chapter 1.1: Economic Outlook – Liberia
SWOT Analysis
Economic Growth Outlook
Strong Remittances, Iron Ore Output Will Not Offset Poor Investment Outlook
Healthy remittance inflows and an ongoing recovery in iron ore output are the two bright spots for the Liberian economy over the coming
two years. However, we do not believe that these will be sufficient to bring headline growth anywhere near its levels of recent years as
low iron prices and a difficult operating environment will continue to deter much-needed investment.
Chapter 1.2: 10-Year Forecast – Liberia
The Liberian Economy To 2026
Extractive Industries Will Drive Growth
Our previously bullish long-term outlook for Liberia has been knocked off course by the Ebola outbreak. Although growth will still be
robust, it will be slower than anticipated. There also remain significant infrastructure challenges.
TABLE: LONG-TERM MACROECONOMIC FORECASTS
Chapter 1.3: Political Outlook – Liberia
SWOT Analysis
Domestic Politics
Victory Hard To Call In Presidential Election But Stability To Prevail
It is difficult to predict who will win Liberia's October 10 presidential election given a large field and the lack of an obvious frontrunner,
and we believe a second round is almost certain. Regardless of who ultimately prevails, we expect broad policy continuity and, more
importantly, broad stability in the lead up to and the aftermath of the vote.
Long-Term Political Outlook
Putting The War Behind It
Liberia will continue on its road towards becoming a stable democracy over the coming decade, steadily recovering from its civil war.
However, poverty, inequality and corruption will remain major challenges to stability and the Ebola crisis set back advances.
Executive Summary – Sierra Leone
Core Views
Major Forecast Changes
Key Risks
Chapter 2.1: Economic Outlook – Sierra Leone
SWOT Analysis
Economic Growth Outlook
Mudslide To Weigh On Fiscal Accounts And Headline GDP Growth
A mudslide that killed hundreds and left thousands homeless in August 2017 will place pressure on the country's strained fiscal
accounts and weigh on growth. The effect on growth and fiscal dynamics is somewhat mitigated, however, by the fact that a portion of
the response will be financed by the international community and by the fact that iron ore production will be unaffected by the disaster.
Contents
Chapter 2.2: 10-Year Forecast – Sierra Leone
The Sierra Leonean Economy To 2026
Ebola After-Effects Will Continue To Weigh On Growth
Our long-term growth forecasts for Sierra Leone have been revised down as a result of the Ebola crisis. Delayed investment into
important growth industries such as iron ore mining will weigh on future economic activity.
TABLE: LONG-TERM MACROECONOMIC FORECASTS
Chapter 2.3: Political Outlook – Sierra Leone
SWOT Analysis
Long-Term Political Outlook
Stability Will Continue Despite Ebola Upheaval
Sierra Leone will enjoy increasing political and social stability over the coming decade as it continues to recover from its civil war.
Nevertheless, poverty and economic inequality will remain key challenges and the Ebola outbreak threatens to set back recent gains.
Chapter 3: BMI Global Macro Outlook
As Good As It Gets?
TABLE: GLOBAL MACROECONOMIC FORECASTS
TABLE: DEVELOPED STATES – REAL GDP GROWTH, % y-o-y
TABLE: EMERGING MARKETS – REAL GDP GROWTH, % Y-O-Y
TABLE: LIBERIA – MACROECONOMIC DATA AND FORECASTS
TABLE: SIERRA LEONE – MACROECONOMIC DATA AND FORECASTS

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