Liberia's Economic History

Older Times 

The early inhabitants of modern day Liberia are believed to have originated from the western Sudan.  With their culture and traditions they also brought with them a form of small-scale trade.  For instance, the indigenous peoples would trade handmade items (pottery, basket, and masks) or weaponry between the different tribes for other items of value.  Iron rods, in particular, are believed to have been a major item used as a medium of exchange. Later on, after European contact, modern day Liberia was involved in many different trades which consisted of spices, gold, alcohol, horses, weapons, and even slaves.[1]   

The Pepper Coast, as it was so called by European traders, is believed to be inhabited as least as far back to the 12^th century.  Local skills consisted of cotton spinning, cloth weaving, iron smelting, and even rice cultivation.  In fact, from older times to the newer times, iron has played a major role in Liberia’s economic history.[2] 

 

Recent Times 

Liberia is one of the poorest countries in the world with an extremely undeveloped economy.  Even though Liberia is rich in water, minerals, forest, and agriculture, it suffers from a ravaged economy primarily due to political upheavals.  The capital city of Monrovia, for instance, has poor human capital and infrastructure.  In addition, the small percentage of local manufacturing is foreign owned, causing even more damage to the Liberian economy.[3] 

The First Liberian Civil War (1989-1996) made a major impact on Liberia’s economy.  Prior to the war, in the 1970s and 1980s, Liberia relied heavily on mining iron ore.  In fact, iron accounted for more than half of export earnings.  However, during the war, many skilled workers fled the country.  In addition, since the coup d’état in 1980, the demand for iron ore significantly declined causing the economy to slow down tremendously.[4]

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[1] “The Grain Coast, Malaguetta Coast or Pepper Coast before 1822”, http://www.liberiapastandpresent.org/Peppercoastbefore1822.htm.

[2] “Liberia”, http://en.wikipedia.org/wiki/Liberia.

[3] “Economy of Liberia”, http://en.wikipedia.org/wiki/Economy_of_Liberia.

[4] “Economy of Liberia”, http://en.wikipedia.org/wiki/Economy_of_Liberia.