Outfits: narrowly tailored laws that harm instead of help

A case study of Liberia’s telecommunication laws

Rosalia de la Cruz Gitau

Introduction

Africa has more than one billion inhabitants that have largely been isolated from consumerist culture. To the enterprising ear this translates into one billion new prospective cell phone users, internet surfers and retail bank depositors. The opportunity to make a great deal of money in largely unchartered territory has shown itself too attractive to resist, if recent trends in banking and telecommunications on the continent are any indicators. The telecommunications sector, in particular, presents many exciting prospects to international investors, and many billion-dollar projects are already underway across the continent. The legacy of international involvement in Africa - both politically and economically - has proven overwhelmingly detrimental. Many of the continent’s current problems can be traced to the exploitation it has experienced whilst ‘doing business’ with the foreign entities in the past. As regards telecommunications, there are billions of dollars to be made - or lost. African governments must be vigilant in preventing yet another one of its resources from being taken at a bargain. Half of the sub-Saharan population lives below the poverty line (World Bank 2010a). Creating legal protections can help to prevent another economic pillaging.

This study will present the case of Liberia, and the development of its telecommunications sector, as an opportunity for pillage or profit. I argue that the legal framework of the telecommunications sector - both laws and enforcement - compromise the type of development the government needs to achieve in order to ‘develop’. This argument will first require a background discussion of: (a) development and its relationship to the law; (b) the advancement requirements of a country like Liberia to reach a stable level of development; and (c) an overview of how investment operates in Liberia - with an emphasis on the role that international donors play in the process. With this background in place, I will support my argument by demonstrating that current Liberian telecommunications laws offer a competitive advantage to international investors. Collectively, such a legal environment compromises the development requirements of a country like Liberia. This study will rely on reigning literature in law and development, the author’s field research, research of major donor agencies and reports of the Liberian telecommunications industry pertinent to the period covered by this study.