Liberia was traditionally noted for its academic institutions, iron-mining, and rubber. Political upheavals beginning in the 1980s and a 14-year civil war (1989-2003) largely destroyed Liberia's economy and brought a steep decline in living standards.

The Liberian economy relied heavily on the mining of iron ore and on the export of natural rubber prior to the civil war. Liberia was a major exporter of iron ore on the world market. In the 1970s and 1980s, iron mining accounted for more than half of Liberia's export earnings. Following the coup d'etat of 1980, the country's economic growth rate slowed down because of a decline in the demand for iron ore on the world market and political upheavals in Liberia.

The 1989-2003 civil war had a devastating effect on the country's economy. Most major businesses were destroyed or heavily damaged, and most foreign investors and businesses left the country. Iron ore production stopped completely, and the United Nations banned timber and diamond exports from Liberia. UN sanctions on Liberian timber were removed in 2006; activity in the timber sector was expected to resume on a large scale during the October 2008-May 2009 dry season. Diamond sanctions were terminated by the UN Security Council in April 2007, and Liberian diamond exports have resumed through the Kimberley Process Certification Scheme. Gold deposits, some of which are currently nearing production, should soon begin to contribute to government revenues and provide additional employment.

Currently, Liberia's revenues come primarily from rubber exports and revenues from its maritime registry program. Liberia has the second-largest maritime registry in the world; there were over 3,000 vessels totaling nearly 100 million gross tons registered under its flag, earning some $18 million in maritime revenue in Liberian FY 2008/2009 (July 1-June 30). There is increasing interest in the possibility of commercially exploitable offshore crude oil deposits along Liberia's Atlantic Coast.

With a democratically elected government in place since January 2006, Liberia seeks to reconstruct its shattered economy. The Governance and Economic Management Assistance Program (GEMAP), which started under the 2003-2006 transitional government, concluded in September 2009 after helping the Liberian Government raise and spend revenues in an efficient, transparent way. In addition, the Liberian Government is working to improve the business climate, has formed a commission to deal with land tenure issues, and is reviewing tax and tariff regimes to harmonize them with neighbors in the Economic Community of West African States (ECOWAS). The Liberian National Investment Commission reported $130 million in new investment in 2008 and has set a target of at least $100 million a year for future years. Investors are finding opportunities in mining, rubber, agro-forestry, light industry, and other sectors. Arcelor Mittal Steel has negotiated an agreement to invest over $1.5 billion in the mining sector, and the Liberian Government is engaged in negotiations with several other large foreign investors.

Years of conflict and mismanagement also left Liberia with a large debt burden of $3.4 billion, owed to multilateral development banks, bilateral creditors, and commercial creditors. In April 2009, most commercial creditors agreed to accept three cents on the dollar for $1.2 billion in outstanding debt. Liberia has made strides to improve public financial management under the Heavily Indebted Poor Countries (HIPC) Initiative, and hopes to reach HIPC completion point in 2010 to qualify for irrevocable debt relief.

Economy
GDP (IMF 2009 est.): $836 million.
Real GDP growth rate (2009, projected): 1.2%.
Per capita GDP (2009 estimate): $204.74.
Average annual inflation (2008, projected): 9.0%.
Natural resources: Iron ore, rubber, timber, diamonds, gold, and tin. The Government of Liberia believes there may be sizable deposits of crude oil along its Atlantic Coast.
Agriculture: Products--coffee, cocoa, sugarcane, rice, cassava, palm oil, bananas, plantains, citrus, pineapple, sweet potatoes, corn, and vegetables.
Industry: Types--agriculture, iron ore, rubber, forestry, diamonds, gold, beverages, construction.
Trade (2007, provisional): Exports--$184.1 million (of which rubber $170.9 million). Major markets--Germany, Poland, U.S., Greece. Imports--$498.7 million (petroleum $125 million; rice $65.3 million).