Liberia: EO 166 Bans Guinea Unprocessed Rubber Transshipment

• Liberia has banned the transshipment of unprocessed rubber from Guinea through its ports, a decision confirmed by Minister of Agriculture Dr. J. Alexander Nuetah.
• This action stems from Executive Order 166, which prohibits all unprocessed rubber from leaving Liberia, including transshipments from other countries via Liberian ports.
• Trade experts view this ban as a breach of international treaties, including WTO Article V GATT, ECOWAS trade agreements, and the AfCFTA framework, which guarantee freedom of transit.
• The policy has triggered regional trade crises, leading to accusations from traders, reduced customs revenue at the Liberia-Guinea border, and business losses for truck owners.
• This is Liberia's first such action against regional trade, setting a potential precedent for unilateral restrictions that could destabilize supply chains and increase legal risks in West Africa.

By unilaterally restricting the movement of goods in transit, Liberia risks establishing a precedent for similar protectionist measures across West Africa.

The Liberian government has initiated a significant shift in its regional trade policy, effectively implementing a ban on the transshipment of unprocessed rubber originating from Guinea. This new directive prevents such goods from passing through the Liberian corridor, specifically utilizing the Freeport of Monrovia for onward international shipment. The decision was officially confirmed by Dr. J. Alexander Nuetah, the Minister of Agriculture, who indicated that the action follows a direct Executive Order issued by the President of Liberia.

This presidential mandate, designated as Executive Order (EO) 166, initially established a comprehensive moratorium on all natural unprocessed rubber from leaving Liberian territory. However, the order contains a crucial extension of this prohibition. Section 3, Part E of EO 166 explicitly states that any violation of its terms encompasses the shipment of unprocessed rubber through Liberian ports, even when that rubber originates from another country. This specific provision is widely understood by trade experts to constitute a complete prohibition on the transshipment of raw rubber, directly impacting countries like Guinea that rely on Liberian ports for export. The move marks a critical development in regional commerce, particularly concerning the flow of agricultural commodities.

This recent policy shift by Liberia is widely viewed by trade experts as a direct contravention of international treaties designed to promote and facilitate free trade across borders. Critically, the action places Liberia in a position of non-compliance with the mandates of the World Trade Organization (WTO). Liberia is a signatory to a multitude of international and regional trade agreements that either explicitly provide for or recognize the unimpeded transit of goods originating from other countries through its territory.

Among these crucial agreements is the comprehensive World Trade Organization (WTO) framework, which notably includes Article V of the General Agreement on Tariffs and Trade (GATT), a cornerstone provision guaranteeing freedom of transit. Further commitments are enshrined within the ECOWAS Inter-State Road Transit Convention and the Revised ECOWAS Treaty, both of which contain explicit provisions for freedom of transit and broader regional economic integration. Liberia's obligations also extend to the African Continental Free Trade Area (AfCFTA) framework and the Mano River Union (MRU) framework, both established to foster regional cooperation and streamline trade facilitation. Consequently, the current policy raises serious concerns regarding Liberia's adherence to its extensive international legal and trade commitments.

The immediate consequence of Liberia's new transshipment policy has been the emergence of significant regional trade crises, particularly impacting its commercial relationship with Guinea. Traders directly affected by the restrictions have openly accused Liberia of adopting an overly stringent and uncooperative approach to regional commerce, fostering a climate of distrust. Beyond the direct trade dispute between Liberia and Guinea, the measure has generated tangible economic repercussions across various sectors.

Customs officials stationed at the Liberia-Guinea border have observed and reported a distinct drop in revenue collection since the ban was instituted. Moreover, the livelihoods of individuals and businesses within the transportation industry have been directly compromised. Truck owners, who previously relied on income generated from the movement of unprocessed rubber across the border, are now expressing considerable concern over substantial business losses resulting from the abrupt halt of these vital transshipment operations. This demonstrates the far-reaching economic disruption caused by the unilateral action.

The current imposition of a transshipment ban marks a notable departure from Liberia's historical engagement in regional trade. Investigations reveal that this is the first occasion on which the nation has taken such a direct action against regional commerce. While a previous Liberian administration did institute a comparable moratorium on unprocessed rubber originating within Liberia, that earlier policy specifically excluded transshipment rubber from its purview, highlighting a significant change in the current government's strategy.

This unprecedented move raises critical questions regarding the rationale behind the policy shift and its potential long-term ramifications for regional stability. By unilaterally restricting the movement of goods in transit, Liberia risks establishing a precedent for similar protectionist measures across West Africa. Such actions could profoundly impact the stability of supply chains and escalate legal liabilities for businesses operating within the region, necessitating close monitoring by legal and compliance professionals advising on West African trade.

Lawyers and compliance officers advising clients on regional trade in West Africa, particularly those involved in the rubber sector or utilizing Liberian ports for transshipment, should assess the immediate compliance risks and potential for trade disputes arising from Liberia's breach of international trade agreements like WTO, ECOWAS, and AfCFTA. This action could set a precedent for similar unilateral trade restrictions, impacting supply chain stability and legal liabilities for businesses operating in the region.

Source: Original reporting via Liberian Observer