Overview:
Importers generally target their goods to the needs of demographics with higher levels of disposable income, including large business entities, government officials, NGO workers, diplomats, civil servants, and the expatriate community. Sales and promotional materials should be in English, the official and most common language in Liberia. A pidgin version of English, known as colloquial, is also widely spoken. Engaging in commerce with most Liberians without some acquaintance with this version of English may be challenging.
Trade Promotion and Advertising
Many trade organizations exist but there are few organized trade promotion programs. Newspaper and television ads, the traditional media for trade promotion, are concentrated in Monrovia. Radio and, increasingly, mobile phone advertisements are popular and effective outlets for country-wide coverage. Trade promotion and advertisements are done in English, local languages, and the commonly spoken colloquial English. On the street, popular methods of advertising include banners, billboards, graphic designs, stickers, fliers, branding of company’s assets, printing on merchandise, corporate brochures, business cards, catalogues, logos, editorial ads, and outdoor events. The Liberia Chamber of Commerce (LCC) sometime organizes local trade shows and buyer programs in Monrovia meant to promote and advertise “made-in-Liberia” products. When considering advertising options, businesses must keep in mind that more than half of the Liberian population is considered illiterate.
Pricing
Most prices in Liberia are market driven. However, the Ministry of Commerce & Industry (MOCI) monitors prices and sets price ceilings for certain essential commodities such as petroleum products, rice, and cement. Historically, MOCI price controls have repeatedly contributed to product scarcity, price hikes, and black-market sales, sometimes resulting in civil unrest and economic disruption. Importers are required to submit cost information to MOCI for approval. Permitted mark-ups vary by product and are based on free on board (FOB) value. Invoiced prices are subject to arbitrary revision. MOCI requires all business entities to display price tags on their commodities denominated in either Liberian dollars or U.S. dollars, in line with prevailing exchange rates. Prices may fluctuate frequently, depending on exchange rate changes. Although the CBL sets the official exchange rate, market forces determine the prevailing street rates, which affect prices. Although MOCI conducts market inspection exercises, it does not effectively enforce the government’s regulation on price tagging of commodities. Additionally, see the Import Tariffs section above.
Sales Service/Customer Support
The quality of sales service and customer support varies. Generally, customer service or customer support is poor at many business centers in Liberia. Most businesses find that new employees require extensive and ongoing customer service training. A few large stores in Monrovia have exclusive after-sale support services available, but generally require their customers to purchase such services separately.
Local Professional Services
There are several business associations, banks, accounting firms, law firms, car rental services, ICT services, business development services, and tax and investment consultancy firms. There are also several law firms as well as investment and tax advisory services providers. Presently, there is no single database or website of local professional service providers.
Principal Business Associations
There are several business associations, trade unions, and professional bodies in Liberia. The primary roles of those associations include providing and offering representation, advocacy, and lobbying for the interests of their members. Some associations provide technical training for their members and serve as a common platform where members meet to share experiences and exchange ideas. Membership of the associations or unions can be overlapping such that an organization or individual business can be a member of more than one association or union simultaneously. Several associations were established by law, including the Liberia Chamber of Commerce (LCC), which accepts foreign businesses as members, and the Liberia Business Association (LIBA), which was established under law for Liberian-owned businesses. The LCC welcomes U.S. companies as members as well as any other local and foreign businesses with offices in Liberia. Business associations include, but are not limited to:
· Liberia Chamber of Commerce (LCC)
· Liberia Business Association
· Liberia Marketing Association
· Association of Liberian Construction Contractors (ALCC)
· Engineering Society of Liberia
· Liberia Timber Association (LTA)
· Liberia Labor Congress
Limitations on Selling U.S. Products and Services
The Liberia Investment Act of 2010 imposes general statutory limits and restrictions on foreign ownership of or entry into 16 business activities/enterprises and sets minimum foreign capital investment thresholds in 12 others. A schedule attached to the Act provides that, “Ownership of the following business activities or industries shall be reserved exclusively for Liberians:”
· Supply of sand
· Block making
· Peddling
· Travel agencies
· Retail sale of rice and cement
· Ice making and sale of ice
· Tire repair shops
· Auto repair shops with investments of less than US$550,000
· Shoe repair shops
· Retail sale of timber and planks
· Operation of gas stations
· Video clubs
· Operation of taxis
· Importation or sale of second-hand or used clothing
· Distribution in Liberia of locally manufactured products
· Importation and sale of used cars (except authorized dealerships that may deal in certified used vehicles).
· Production and supply of stone and granite
· Ice cream manufacturing
· Commercial printing
· Advertising agencies, graphics, and commercial artists
· Cinemas
· Production of poultry and poultry products
· Operation of water purification or bottling plants (exclusively the production and sale of water in sachets)
· Entertainment centers not connected with a hotel establishment
· Sale of animal and poultry feed
· Operation of heavy-duty trucks
· Bakeries
· Sale of pharmaceuticals.
The Act also stipulates that, “For enterprises owned exclusively by non-Liberians, the total capital invested shall not be less than US $500,000. For enterprises owned in partnership with Liberians and the aggregate shareholding is at least 25 percent, the total capital invested shall not be less than US $300,000.” The Act raised the threshold for foreigners to $500,000 but lowered it for joint ventures with Liberians to $300,000. Otherwise, Subsection 6.3 of the Act provides that “foreign investors may wholly own, or in partnership with Liberians, control business organizations in any sector of the economy in Liberia.” In addition to the restrictions imposed by the Act, non-Liberians are not allowed to own land in Liberia, which disincentivizes quality construction of buildings.