Controversy Deepens Over Liberia’s Lone Railway – Pundit Quips: “Favoring Foreign Ore Over Domestic Mining?”

MONROVIA – It seems government of Liberia’s attempt to indulged into “eat so, eat so” – a local parlance referring to duality of interest on a single affair – regarding the use of the country’s single railway is fast continuing to becloud the state of the mining sector, with economic implications for both government and concessionaires. All alerts and counsels from experts for the Boakai administration to get sober regarding the dangers at bar are seeming elbowed and shrugged, prompting an economic commentator has voiced out his perspective for the purpose of providing more counsel, thus doubling down on the matter. The Analyst reports.  

Liberia’s rail infrastructure is at the center of a growing controversy as the government appears to prioritize foreign companies’ interests over the development of its own mining sector. With mounting concerns from industry stakeholders, critical questions are being raised about the government’s approach to managing the country’s rail and port assets.

ArcelorMittal Liberia (AML) is currently undertaking a major expansion project that promises to bring immense economic benefits to Liberia. The expansion will create 2,000 new jobs, generate an additional $200 million in annual revenue for the government, and significantly increase AML’s corporate social responsibility (CSR) contributions to local communities. This investment represents one of the most substantial commitments by a private entity in Liberia’s recent history.

However, despite these benefits, AML is facing growing opposition from foreign interests seeking to remove it as the operator of Liberia’s key rail infrastructure. These competing interests, particularly HPX, are lobbying for control over the railway and port facilities to facilitate the transportation of Guinean iron ore through Liberia. The government’s consideration of this proposal raises concerns about the long-term implications for Liberia’s economic stability and mining sector.

ArcelorMittal, Liberia’s largest mining investor, is advocating for a user-operator model in Guinea’s bauxite mining sector. Under Guinea’s approach, the government has designated the Compagnie des Bauxites de Guinée (CBG) as the rail operator while allowing two other mining firms access to the railway. These companies contribute to capital expenditures (CapEx), are allocated capacity, and enjoy rail access—but none has independent operational control over the infrastructure.

Meanwhile, the Liberian government is taking a starkly different approach. Instead of ensuring that its own mining companies fully benefit from the existing rail infrastructure, it is considering allowing foreign ore, particularly from Guinea, to transit through Liberia. This raises critical concerns about the future of the country’s mining industry and infrastructure sovereignty.

A fundamental question arises: Why is the Government of Liberia (GoL) actively facilitating the transportation of Guinean ore through Liberian infrastructure while limiting its own mining sector’s capacity to expand and use that same infrastructure? Mining companies in Liberia are subject to rigorous regulations and investment requirements, yet foreign entities appear to be gaining privileged access without making comparable commitments to the country’s development.

The potential entry of High Power Exploration (HPX), a company pushing for a cross-border ore transportation route from Guinea through Liberia, further complicates the issue. If HPX is granted permission to move its ore through Liberia, the government will receive no major investment from the deal. Additionally, it will reduce rail capacity for Liberian companies that contribute royalties, taxes, employment, and local business growth. This decision could effectively sideline the domestic mining industry, hampering long-term economic growth.

The most pressing concern is why Liberia is seemingly sacrificing its own rail capacity to accommodate foreign mining interests. By allowing Guinean ore to take precedence, the government is reducing the available infrastructure for Liberian mining companies that could bring far more economic benefits to the country.

This stands in stark contrast to Guinea’s rail and port infrastructure policy. The Guinean government has required mining companies to invest in the development of the country’s rail and port infrastructure while retaining control over these assets for 35 years. This model ensures that user-operators not only contribute to national development but also remain responsible for expanding capacity to accommodate additional users. Even after the initial 35-year period, the original user-operators retain operational control.

Another critical concern is Liberia’s approach to infrastructure management. If the government continues on its current path, potential investors may hesitate to invest in the country’s rail and port facilities. No company would be willing to commit substantial financial resources if they know that the government could later seize control and hand operations over to an external entity under the pretext of an Executive Order or through the creation of a National Rail Authority (NRA).

This issue becomes even more pressing when considering AML’s substantial investment in Liberia’s infrastructure. The company has invested millions into the rail line, making it the backbone of Liberia’s mining industry. However, foreign interests are aggressively seeking to have AML removed as the rail operator, despite its continued commitment to Liberia’s economic growth.

If Liberia allows foreign companies to dictate the terms of its rail and port management, it risks losing control over key national assets. AML’s expansion plan offers undeniable benefits, including job creation, increased government revenue, and greater community investment. Allowing external players to undermine this investment would not only discourage future investors but also weaken Liberia’s ability to capitalize on its natural resources.

The government must weigh its options carefully. Will it support a proven investor with a strong track record in Liberia, or will it open its infrastructure to foreign companies that seek to benefit without making long-term commitments? As Liberia navigates these complex policy decisions, it must ensure that its choices align with national interests. If the government truly aims to maximize the benefits of its rail and port infrastructure, it should prioritize domestic mining development rather than offering its resources to foreign competitors at the expense of local economic growth.