But When Did Top Liberian Gov’t Officials Get To Know Fronting Is Pervasive?
By Alfred Kollie, alfredkolliejr92@gmail.com
Observers say that while foreign investment remains critical to Liberia’s growth, improving transparency, enforcing existing laws, and empowering local entrepreneurs will be key to ensuring that the country’s economic benefits are shared more equitably among its citizens.
Monrovia, Liberia — After years of fronting in the Liberian business sector, Vice President Jeremiah Kpan Koung Sr. has publicly acknowledged the high level of fronting being carried out, something which undermines the Liberianization policy.
VP Koung disclosed that although many businesses in Liberia are officially registered under Liberian ownership, a significant number are in reality controlled by foreign individuals operating behind the scenes.
Speaking Monday on the state radio, ELBC live morning talk show, the Liberian Vice President Koung revealed that Liberians are often used as “fronts” for foreign business interests.
The Vice President statement comes days after the Chairman of the Patriotic Entrepreneurs of Liberia (PATEL), Dominic Nimely spoke of weakness in implementation of the Liberianization law restricting certain kinds of business to only Liberians and preventing foreign wholesalers from concomitantly engaging in retailing of goods.
Mr. Nimley threatened what he described as a “citizen’s arrest” against foreign nationals engaged in both wholesale and retail trade in Liberia. PATEL Chairman Threatens “Citizen’s Arrest” On Foreign Retailers—Why? – News Public Trust
According to him, these arrangements typically provide minimal benefit to the Liberian individuals involved, while allowing foreign operators to bypass legal restrictions.
“Liberians are fronting for these businesses just for a little or nothing,” Koung noted, emphasizing the imbalance in such partnerships.
The Vice President, who is has a background in business, acknowledged the complexity of addressing the issue.
Poor enforcement of Liberianization law
However, enforcement is difficult because many of the businesses are legally registered in the names of Liberian citizens, making it challenging for authorities to prove foreign control.
To tackle the problem, Koung disclosed that his office is collaborating with the Liberia Business Registry to identify solutions and strengthen oversight within the sector.
The revelation highlights long-standing concerns about business practices in Liberia, where companies are formally Liberian-owned but financed or managed by foreign nationals.
Analysts say this trend undermines economic fairness and raises questions about compliance with national laws.
Liberia’s economy has historically relied on foreign participation, particularly in sectors such as mining, trade, and large-scale industries.
However, stakeholders argue that weak enforcement of regulations, limited access to capital for locals, and legal loopholes have contributed to the growing practice of “fronting.”
Business groups, including the Liberia Business Association, have repeatedly warned that foreigners are operating in sectors reserved exclusively for Liberians.
Reports indicate that such activities are prevalent in retail trade, block making, and sand mining areas intended to empower local entrepreneurs.
Experts caution that the continued practice could have serious economic consequences, including reduced opportunities for Liberians, increased capital flight, unfair competition, and a weakening of national economic independence.
Under the Liberian Investment Act of 2010, several small-scale business activities are reserved strictly for Liberian citizens.
These include sand supply, block making, street peddling, travel agencies, rice retail, ice production, tire and auto repair, beauty salons, video clubs, gas station operations, small-scale printing, advertising, commission agencies, and the importation and sale of second-hand clothing.
The law prohibits foreign ownership or direct involvement in these sectors, and using Liberians as proxies to circumvent these restrictions is considered illegal.
Observers in the business sector say that while foreign investment remains critical to Liberia’s growth, improving transparency, enforcing existing laws, and empowering local entrepreneurs will be key to ensuring that the country’s economic benefits are shared more equitably among its citizens.