New developments have surfaced concerning the Mineral Development Agreement between the Government of Liberia and Arcelor Mittal Liberia. Sources tell LiberianEconomy.com that these developments majorly benefit the AML both on the short and long term, and are not in compliance with Executive Order 112 issued by President Weah. If approved, significant damages will be caused both to the country’s economy and Liberian citizen’s incomes.
According to our sources the revised drafts of the agreement prioritize and grant a privileged position to AML as the user operator of the infrastructure corridor to the detriment of all other users, therefore negating the benefits of the Infrastructure Corridor overall and failing to deliver maximum use of this critical Liberian national asset.
Moreover, the Revised Drafts contradict the policy of the Liberian Government, and also existing Liberian law, both of which are set forth in Executive Order 112 issued by the President of Liberia. Executive Order 112 states that “the Government is committed to the core principles of open, nondiscriminatory access on a multi-user basis to the Liberian lnfrastructure Assets for ArcelorMittal Liberia, lvanhoe and SMFG (or their affiliates) together with any other eligible users” and commits that “Eligible User access arrangements for the Liberian lnfrastructure Assets [shall] conform to the Core Principles.”
On the other hand, the consequences for Liberia in case this amendment is adapted are significant.
Liberia will receive no other investment on the Liberian Infrastructure Assets until 30 June 2025, as no other user will be allowed to construct capacity.
Furthermore, this potential investment will be prevented without any guarantee that ArcelorMittal will actually invest in and construct its own 15 mtpa capacity. The National Railway Authority will be disempowered and operation of the Liberian Infrastructure Assets will be subject to ArcelorMittal’s control. Excess capacity will not be utilized efficiently as use of it would require consent from ArcelorMittal on ArcelorMittal’s terms. This will result in less usage of Liberian Infrastructure Assets and therefore less revenue generated.
ArcelorMittal can continue using and operating the Liberian Infrastructure Assets for extensive periods of time while in breach of its obligations to Liberia, potentially even harming the Assets themselves if it is in breach of its role as Operator, while there will be no way to hold AML accountable to the Government or the People of Liberia and therefore no way of ensuring the Liberian Infrastructure Assets are operated and maintained to appropriate standard.
Ultimately, overall exploratory work in Liberia decreases, reducing the potential for future projects and related revenue. This results to lower income for Liberians and lower number of jobs for them, while the country simultaneously loses millions in profit.
It is up to the Liberian authorities to decide on whether they put Liberia first, or they grant the earned benefits of its citizens to Arcelor Mittal instead.
Tags: Arcelor Mittal Liberia, Economy, Executive Order 112, Government of Liberia, Liberian citizens’ incomes, LiberianEconomy.com, Long term, mineral development agreement, Revised drafts, Short term
