The Liberian government is embroiled in a contentious debate over the operational control of the crucial Yekepa-Buchanan railway, a vital artery for the nation’s iron ore industry. The Inter-Ministerial Concessions Committee (IMCC), tasked with overseeing such decisions, initially and unanimously voted to retain ArcelorMittal Liberia (AML) as the operator, citing the company’s existing investment in the railway, ongoing operational control, and the need for stability to maintain investor confidence. This decision was formally communicated to all stakeholders, emphasizing AML’s significant contributions to maintaining and upgrading the railway, and highlighting the potential disruptions and legal challenges that could arise from altering the existing agreement. The IMCC’s rationale centered on minimizing operational uncertainty and avoiding potential legal battles that could deter investors. Furthermore, the committee underscored AML’s willingness to grant multi-user access to the railway at no cost to other companies, including High Power Exploration (HPX), a competing entity vying for control.
However, the IMCC’s carefully considered decision was swiftly thrown into disarray by alleged behind-the-scenes lobbying by Minister of State Sylvester Grisby, who is accused of advocating for HPX. Grisby reportedly escorted HPX’s Liberia CEO, Brownly Brown, to President Joseph Boakai’s private residence to pressure him to overturn the IMCC’s decision and reopen negotiations favoring HPX. This alleged intervention has sparked significant controversy and raised concerns about transparency and due process within the Liberian government. Critics point to the potential for undue influence and question the rationale for potentially jeopardizing a stable arrangement with a company that has already invested heavily in the railway infrastructure. This interference comes despite the National Investment Commission (NIC) and the IMCC’s concurring assessments that retaining AML as the operator is economically sound, particularly given Liberia’s current fiscal constraints.
The crux of the dispute lies in HPX’s desire to gain operational control of the existing railway, despite having made no investment in its development or upkeep. HPX plans to use the railway to transport iron ore from Guinea to the Port of Buchanan in Liberia. While AML has offered to accommodate HPX and other users through a regulated framework, HPX has persistently pushed for exclusive control, seemingly disregarding AML’s existing legal rights under its Mineral Development Agreement (MDA). Adding to the controversy are allegations that Minister Grisby has disclosed sensitive negotiation details to HPX, bypassing official government channels. This alleged breach of protocol has further fueled concerns within the Executive Mansion and amongst other government officials. The situation is exacerbated by HPX’s failure to deliver on its previously announced $5 billion Liberty Corridor project, a regional infrastructure initiative that included a new railway from Guinea to Liberia.
The Liberty Corridor project, initially envisioned as a partnership between HPX and South Africa’s Guma Africa Group, promised substantial infrastructure development, encompassing a new railway, road upgrades, power enhancements, and telecommunications improvements. However, Guma Africa has reportedly withdrawn from the venture, purportedly due to concerns that HPX’s primary focus was acquiring access to Liberia’s existing railway rather than constructing new infrastructure. Furthermore, HPX has allegedly failed to secure its share of the project funding, which was reportedly linked to a U.S. government fund intended to counter Chinese influence in Africa. This funding was subsequently blocked by U.S. Senate Republicans, leaving the Liberty Corridor project in limbo. The combination of HPX’s unfulfilled promises regarding the Liberty Corridor project and its aggressive pursuit of control over the existing railway, despite not having invested in it, has raised red flags about the company’s intentions and capabilities.
The current situation draws uncomfortable parallels to a similar incident in 2021, during the George Weah administration. HPX’s lobbying efforts at that time reportedly contributed to the collapse of an $800 million investment deal with AML, leading to significant economic setbacks for Liberia. The disruption of the 2021 deal resulted in job losses, delayed infrastructure upgrades, and a substantial loss of potential government revenue and social development funding. This historical context amplifies the concerns about the current situation and the potential for repeating past mistakes. Many observers fear that Minister Grisby’s intervention and HPX’s persistent lobbying could derail AML’s amended agreement, which is currently in advanced stages. This agreement promises significant economic benefits for Liberia, including job creation, increased government revenue, and substantial contributions to social development funds.
The stakes are high for Liberia, as the decision regarding the railway’s operation has far-reaching implications for the nation’s economic recovery and future investment prospects. Critics argue that jeopardizing a stable and beneficial agreement with AML for the sake of a company that has yet to demonstrate its commitment to Liberia’s development could have devastating consequences. The IMCC’s upcoming meeting holds significant weight, as it will determine whether the government reaffirms its initial decision to retain AML as the operator or succumbs to external pressures to reconsider. The outcome will signal Liberia’s commitment to fostering a stable and predictable investment environment. The international community and potential investors are closely watching the unfolding events, assessing whether Liberia will prioritize long-term economic stability and responsible development or risk repeating the costly errors of the past. The decision will also have a profound impact on the lives of ordinary Liberians, who stand to benefit from the jobs, infrastructure improvements, and increased government revenue promised by AML’s investment.
