welcoming Pres. Weah’s Biggest Foreign Direct Investment with a call to the Legislature

MONROVIA-Liberia’s national development roadmap, the Pro-Poor Agenda for Prosperity and Development (PAPD), crafted by the current administration of President George M. Weah clearly lays out the strategy for confronting the nation’s multi-faceted socio-economic and development challenges which threaten its future.

The PAPD is built on the four cardinal pillars: 1) Power to the People, 2) the Economy and Jobs, 3) Sustaining the Peace, and 4) Governance and Transparency.

Pillar Two on the economy and jobs is considered the key driver for achieving the rest, and the Liberian private sector has a leading role to play.

Under Pillar Two, the emphasis is on maintaining macroeconomic stability, building good infrastructure, and providing a business-friendly environment that can stimulate private productive investments and create more and better-quality jobs that are germane to sustaining the peace and to future economic growth.

Over the last fifteen years, ArcelorMittal Liberia has demonstrated that achieving these important deliverables is possible through its strong partnership with Liberia and its increased investment in the country with a far-reaching positive impact on the economy and revenue generation, jobs, county social development, and more.

With the signing of an amended Mineral Development Agreement and announcement of an additional USD $800 million investment in the country’s economy through the mining industry, the ArcelorMittal Liberia Phase Two expansion project will have huge transformational benefits for the country as was recently emphasized by H.E. President George M. Weah.

“Direct foreign investment in value-added projects is the cornerstone of economic growth for Liberia and an important part of initiatives under the government’s Pro-poor agenda by creating jobs and stimulating other economic benefits. Significant progress has been made in negotiations with ArcelorMittal Liberia. The goal is to amend the Mineral Development Agreement so that it gives more benefits to the Liberian people and also ensure an additional investment of $800 Million US dollars to execute the second phase of their expansion by constructing a value-addition concentrator plant,” President Weah said in his last Annual Message.

The proposed third amendment to the ArcelorMittal Liberia Mineral Development Agreement was since submitted to the legislature for ratification.

The planned new USD $ 800 million investment will be the largest foreign direct investment during President Weah’s administration.

Today, as the Liberian leader delivers his 5th Annual Address in the first joint assembly of the 5th session of the 54th Legislature, Liberians will be all ears to hear about the state of affairs of the nation, and the Government’s plans, particularly related to the economy and jobs, a subject closed to the hearts of many.

It is hoped that there will be some positive news from the Chief Executive about the widely publicized recently signed amended ArcelorMittal Liberia Mineral Development Agreement.

The expansion project – which encompasses processing, rail, and port facilities – will be one of the largest mining projects in West Africa.

It includes the construction of a new concentration plant and the substantial expansion of mining operations, with the first concentrate expected in late 2023, ramping up to 15 million tonnes per annum (‘mtpa’). Under the agreement, the company will have a reservation for expansion for at least up to 30mt. Other users would be allowed to invest for additional rail capacity.

It is no doubt, the ArcelorMittal Liberia amended Mineral Development Agreement offers huge socio-economic dividends for Liberia, most especially, the three counties of Nimba, Bong, Grand Bassa where the company operates.

Job Creation & Economic Enhancement

Beginning 2022 during the construction period of the mega concentrator plant and other mining infrastructures, 2000 (two thousand) new jobs will be created, especially for young Liberians. The concentrator plant and expansion will create about 1200 new skilled permanent positions for Liberians as the plant is planned to be commissioned in 2023.

With the training and development of people at the core of its operations, AML will utilize its Vocational Training Institute and its external network to train and prepare more Liberians to meet demands for the highly technical skills associated with operating complex technology such as the concentrator.

AML will further increase local procurement which will grow multi-fold with the 15mtpa expansion and support the development of local businesses and SMEs. This will create further indirect employment in the country, supporting Government’s Pro-poor Agenda.

County Social Development Fund (CSDF)

Under the new amendment, AML’s annual CSDF payments will increase up to $3.5 million after the amendment is ratified. Currently, 20% of the CSDF is being allocated to specific programs selected by the counties and communities, which AML is financing directly to the communities. With Govt agreeing to direct 100% of CSDF contribution directly to the 3 counties, a huge opportunity will be created for undertaking many other community development programs in these 3 counties

Increased Government Revenue

AML’s contribution to Government revenues (from royalties, taxes, duties, etc), will increase from the current level of USD $30-40 million annually to approximately $75 million annually when Phase 2 is ramped up.

Liberia Becomes a Major Iron Ore Producer Port & Rail Expanded

The expansion project – which encompasses new processing facilities, and further expansion of rail and port facilities – will be one of the largest mining projects in West Africa ramping up from the current 5 mtpa of DSO to 15 mtpa of high-value concentrate.

AML plans to further expand the operations to approximately 30 million tons which will create a major boost to Liberia’s GDP, as payments to the Government of Liberia would correspondingly increase as AML’s operations increase.

The new Amendment provides provision for this additional expansion with a feasibility study to be completed next year.

Multiuser Rail & Port Infrastructure

Proposed Amendment to AML MDA lays out a detailed multiuser arrangement for rail and port. The Government of Liberia continues to be the owner of Rail and Port infrastructure since 2007 and this Amendment further elaborates the Government of Liberia’s ownership, by GOL determining who can utilize the infrastructure corridor.

This agreement strengthens Government’s demand for other users including Guinean miners to utilize the Liberia infrastructure for their export. The other users will need to invest to increase the capacity of the rail and port for their use.

AML will operate the rail at cost with zero profit for all users of the infrastructure. These users will have to pay a transit fee to the Government of Liberia only.

A call to the Legislature

While an agreement of this scale will no doubt attract a lot of interest as we have seen over the last couple of months, ratification of the amended AML MDA serves the greater interest of Liberia and Liberians and must be done with all urgency.

We believe that our leaders in the legislature will cut through the anti-MDA ratification sentiments and the negative propaganda against the company and consider the bigger picture of the opportunities to be missed should the MDA passage be hampered.

As your employers, we the people call on you emphatically to ratify the third amendment to ArcelorMittal Liberia’s Mineral Development Agreement (MDA) now, rather than later.


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