Digging Deep for Business Success in Liberia

With a small loan, a drilling machine, and plenty of sweat and patience, entrepreneur Mohammed Prosper has probed hard patches of Liberian ground to unlock the riches lurking underneath.

It wasn’t gold, diamonds, or oil he was after, but fresh water – a precious resource in a country where only one in four has access to safe drinking water, and water-borne diseases like cholera strike regularly.

Mohammed has grown his natural mineral water business, ‘Prosperity’, thanks to four loans totaling $200,000 from Access Bank, an IFC client and investee company that is far-and-away the largest provider of small and micro loans in Liberia.

Mohammed packages thousands of sachets of water daily, selling to wholesalers who distribute them in Monrovia and elsewhere. The sachets can be purchased in small stores and are also sold by individual traders along busy roads.

“Everybody needs water and I am proud to provide it,” Mohammed said. “I started seven years ago with only a few employees and now I have hired 72 people. I have also worked for international groups like UNICEF, especially during the Ebola crisis here, and I drill boreholes for free for small communities.”

Mohammed is 40. Liberia was locked in civil war and an unsteady peace for 14 years between 1989 and 2003, more than a third of his life. He lived through the country’s darkest days, emerging as one of many toughened entrepreneurs who believes anything can be achieved in Liberia with peace -- and a little financial support, of course.

“My dream is to sell water in bottles as well as sachets and to open a bottling plant right here in Monrovia,” he said. “After that, I am interested in making juices and other drinks with my water, and then I will look at markets outside Liberia. Of course I will need Access Bank to help me grow to those heights.”

 

Unique Combination of Support

IFC also believes success is possible in fragile and conflict affected situations (FCS). Its FCS Africa Program is supporting private sector growth in all 19 countries in sub Saharan Africa the World Bank Group describes as ‘fragile situations’.

The CASA Initiative

Launched in 2008, the Conflict Affected States in Africa Initiative (CASA) was IFC’s first program dedicated to supporting private sector growth and job creation in Africa’s fragile states. Recently, CASA has begun applying ‘conflict and gender lenses’ to the IFC projects it supports in fragile states. These tools help ensure IFC contributes to peace and stability in fragile states (by spreading benefits to various groups or regions, for example) and focuses on women in development outcomes, as much as possible. CASA is supported by donor partners Ireland, the Netherlands, and Norway. Sweden provides additional support to CASA in Liberia.

FCS Africa provides a unique combination of support that includes business development, funding, and knowledge management. IFC staff on the ground in fragile states work closely with public and private sector partners, identifying sectors ripe for investment, helping remove bottlenecks, and compiling lessons to apply to  other fragile countries or regions.

In Liberia, IFC invested $156 million in 28 projects between FY08 and FY16, including $1.3 million in Access Bank, which has issued more than 100,000 business loans in the country valued at more than $140 million.

IFC has also supported improvements to Liberia’s business environment. For example, IFC partnered with Liberia’s Central Bank to establish a collateral registry to allow individuals and small businesses to apply for loans using movable assets (vehicles, inventory, etc.) for collateral. Launched in 2014, the registry has already provided access to more than $226 million in loans.

As with most fragile states, Liberia’s road to recovery and prosperity has been bumpy. Having emerged from civil war more than a decade ago, the country has since faced fresh challenges, including the Ebola epidemic, which killed thousands, slumping commodity prices, and persistent high unemployment.

Entrepreneurs like Mohammed acknowledge the challenges -- but without succumbing to them.

“There are a lot of challenges in Liberia for sure,” Mohammed said. “There are electricity and transport challenges, but the number one challenge was Ebola. It was a tough time, but Access Bank helped me through by restructuring payments and it’s a reason why I remain a number one client today,” he said.

To read more about IFC’s support for Africa’s fragile states click here.

By Jason Hopps

jhopps@ifc.org

Published in April 2017