Liberia clears last hurdle to WTO accession
On 14 June 2016, Liberia ratified its accession package to the WTO, clearing the last hurdle for the West African country to become the global trade body’s 163rd member. Liberia will become a full-fledged member of the WTO on 14 July 2016, 30 days after it notified the ratification of its Protocol of Accession to the organisation.
The country’s eight-and-a-half year long accession process culminated on 16 December 2015 at the Nairobi ministerial conference (MC10), when WTO members formally approved Liberia’s accession to the WTO (See Bridges Nairobi Update #3, 16 December 2015).
In his remarks at MC10, Director General Azevêdo described the immense impact WTO membership can have, and while paying tribute to Liberia’s President Ellen John Sirleaf, announced that the WTO “will keep working with you [Liberia] to ensure that these benefits are delivered.”
At the ministerial conference, President Sirleaf also stated that the path to accession has “come with milestones of economic growth with a GDP growth from 5.3 percent in 2005 to 8.7 percent in 2013.”
Regarding its pledged commitments, Liberia has negotiated tariff concessions and commitments that bind tariff rates for agricultural products at 23.8 percent, and non-agricultural products at 27.2 percent. Liberia also made commitments in 11 service sectors, including telecommunications, legal services, banking, and medical and dental services.
Liberia’s Minister of Commerce and Industry noted in 2015 that developing the services sector is a priority for Liberia to diversify “the economy from an extractive growth driven to a services economy.”
Because the accession process to the WTO can often be prolonged, complex, and a drain on resources, the organisation’s members decided in June of 2012 to streamline and facilitate the accession process for LDCs. Invoking this decision, members agreed to grant Liberia transitional periods for trading rights, customs valuation, technical barriers to trade (TBT), sanitary and phyto-sanitary (SPS) issues and intellectual property rights.
The transitional periods for TBT and SPS issues allow measures to be applied on a non-discriminatory basis until August 2017, meaning any changes made within Liberian laws regarding the those fields will not be viewed as a deviation from consistency with WTO rules.
Path to recovery
With its history of patrimonial regimes and civil wars now behind it, Liberia has transitioned to a democratic system, and its acceptance as a WTO member further signifies its commitment to transparency. Experts say that it will bring the country into a rules-based system that will encourage economic reforms, helping set the Liberian economy on the path to lasting recovery (see Bridges Africa, 12 October 2015).
Its previous economic progress was interrupted by the shock resulting from the Ebola outbreak. GDP growth fell from 8.7 percent in 2013 to less than one percent in 2014 and 2015 after the outbreak. While the health crisis has since been contained and resolved, the economic dimensions of the crisis are likely to be felt for years to come.
In particular, the private sector is at its lowest point since the end of the civil war in 2004. In 2015, 50 percent of households were out of work and the majority of sectors decreased wages dramatically. The loss of livelihoods and decreased consumer spending has made it increasingly difficult to maintain operations to produce and supply goods to the market.
For this reason, reviving the private sector, and the economy in general, has made WTO accession a priority for President Sirleaf. As mentioned previously, accession is predicted to increase market access for Liberian businesses, and establish a transparent rules-based trading environment.
Once officially a WTO member, Liberia will become the 35th LDC to enter the WTO. Other LDCs that are currently negotiating the terms of their accession include Bhutan, Ethiopia, Liberia, Comoros, Sao Tome & Principe, Sudan, and Equatorial Guinea.
ICTSD reporting; "Liberia to become 163rd WTO member," WTO, 15 June 2016. "Overview of Liberia's Commitments," WTO, 16 December 2015.