On my 2nd day here, I found it hilarious that I could chat in Lebanese to the supermarket owner in Monrovia (he, on the other hand was completely unfazed). It turns out there are thousands of them all over this place. They own hotels, restaurants, drycleaners, construction companies – you name it. They first came during the 19th century, as part of a wave of immigration fleeing the rough conditions of the Ottoman Empire. Their number reached 10,000 before the Liberian civil war and is estimated at 4,000 today.
Their disproportionate economic power is often cause for resentment among the Liberians. In turn, the long-established Lebanese community is resentful for being banned from becoming citizens: almost uniquely in the world today, Liberia confers citizenship on the basis of race, extending it only to ‘Negroes or persons of Negro descent’ (to understand why, see this post). This deprives the Lebanese (and other immigrant groups such as Indians and Chinese, whose number is on the rise) of the rights to vote and to own land. More importantly, it has serious economic implications for the country: If you don’t own it, you don’t invest in it. Good old Capital Flight.
It is estimated that something around $245 million leave Liberia yearly (total outflow). That’s almost 14% of GDP (2010)!
UPDATE: June 27, 2011
Since Moustapha’s comment on my post, I’ve done some more research on whether the naturalization policy imposes limitations on investments. I have to say I am agreeing more and more with him that the effect of naturalization on capital flight is probably exaggerated. Even though foreigners are not allowed to own land, they can lease it for as long as 50 years. They can also own land through private companies – even if those companies are foreign-owned. Work and resident visas are not hard to obtain and can be renewed yearly.
That being said, Liberia today continues to be perceived as a high-risk environment, attracting risk-tolerant investors who are typically more interested in short-term money-making ventures rather than long-term investments.
So, this remains an open question. If anyone has links to research done on this subject and on the role of Lebanese diaspora in African economies, please share away!