Liberia - Industry
In the 1960s Liberia was one of the biggest exporters of iron-ore, with deposits of 800 million tons of 35-to 67-percent purity ore, and new deposits of 1 billion tons of high grade ore had been discovered. Many international companies were exploiting the ore from Liberia, but in the 1980s the industry suffered from depressed steel prices and the parastatal NIOC closed in 1985. Other companies made cutbacks, leading to a reduction in production to only 1 million tons in 1989, from a high of 15 million tons in the mid-1980s. All production halted early in the war, and no figures have been produced since 1992, when production was estimated at 145,000 tons. Revival of the sector will take huge investments to repair mines and replace equipment, though several international companies have appeared interested.
Diamonds and gold are produced by small-scale mining, though reliable figures have never been available due to smuggling. In 1988, diamonds accounted for US$9 million of exports officially, and gold production yielded an estimated US$6 million a year in the mid-1980s. The illicit mining and export of diamonds remains widespread. In early 1999, the government estimated that there were 5,000 unlicensed and 1,000 licensed mines in Liberia. The government does not have the resources to tackle the problem of unlicensed mines. Official diamond exports tripled between 1998 and 1999, but this is almost entirely due to smuggling of diamonds from Sierra Leone now that there are restrictions on Sierra Leone diamond export to prevent the proceeds supporting the rebel movement there.
Before the civil war manufacturing and construction accounted for around 20 percent of the GDP; that figure dropped to 10 percent by 2000. Manufacturing was dominated by iron-ore production and rubber processing, but domestic and industrial consumption goods were also produced. The size of the local market in Liberia is very small (the United States market is 15,000 times larger in terms of purchasing power), and this makes investment to produce goods for domestic consumption in Liberia unattractive. Political instability has further discouraged investment, particularly from foreign sources. Looting during the civil war means substantial investment is needed to revive the sector. Construction should be stimulated in the post-war period due to reconstruction.