-Hosts workshop on Mainstreaming Climate Change into Liberia’s Financial Sector
By Jerromie S. Walters
The Central Bank of Liberia (CBL), in partnership with the World Bank, hosted a workshop Thursday, June 5, 2025, to validate critical report on integrating climate risks into Liberia’s financial sector. The workshop, held at the Mamba Point Hotel, brought together government officials, financial regulators, and international partners.
Representing CBL Executive Governor Hon. Henry F. Saamoi, Development Finance Director Jay Gbleh-Bo Brown noted that climate change is no longer just an environmental issue but a full-scale economic emergency. According to him climate change is an existential threat to the nation’s economy and financial stability.
Brown noted that without urgent action, climate-related disasters could shrink Liberia’s GDP by 15% and push an additional 1.3 million people into poverty by 2050, according to World Bank projections. He emphasized that Liberia’s heavy reliance on climate-sensitive sectors like agriculture, forestry, and fisheries makes it particularly vulnerable. “Flooding, rising sea levels, and unpredictable rainfall are not distant threats—they are already destroying livelihoods, destabilizing businesses, and putting financial institutions at risk,” he said.
The report, developed with support from the World Bank and the NDC Partnership, warns that unchecked climate impacts could lead to widespread loan defaults, insurance crises, and inflation spikes. Consultant Louise Brown, who led the study, explained that banks and insurers must immediately assess their exposure to climate risks, as failing crops, flooded properties, and storm-damaged infrastructure could trigger financial sector instability.
To avert disaster, the CBL announced a series of urgent reforms, including mandatory climate stress tests for banks, the creation of a dedicated climate risk unit, and new regulations to incentivize green investments. The bank also plans to introduce a “green taxonomy” to classify sustainable projects and explore climate bonds to fund resilience efforts.
Brown stressed that Liberia must also tap into global climate finance, noting that the country currently receives less than 2% of available funding despite being one of the most vulnerable nations. The World Bank has pledged support through its Liberia Investment, Finance, and Trade (LIFT) Project, but officials warned that delays in implementation could prove catastrophic.
During a presentation at Liberia’s National Climate-Financial Workshop, climate finance specialist Louise Brown flagged delivered the growing risks climate change poses to financial systems worldwide, with particularly dire implications for vulnerable nations like Liberia. Brown emphasized that while Africa urgently requires $2.8 trillion in climate adaptation funding by 2030, the continent’s most at-risk countries, including Liberia, currently receive less than 2% of available global climate finance – a dangerous disparity that leaves economies unprotected against mounting threats.
The consultant pointed to alarming warnings from financial institutions across the globe that should serve as urgent wake-up calls for Liberian policymakers. The Bank of Korea has projected potential trillion-dollar losses for financial sectors due to climate impacts, while the Philippines Central Bank has officially classified climate change as a systemic risk to financial stability. Major insurers have begun sounding alarms about possible sector-wide collapses from escalating climate disasters, with current stress tests dangerously underestimating potential financial losses.
Brown explained that climate change threatens financial systems through two primary channels. Physical risks include the increasing frequency and severity of climate disasters such as floods, droughts, heatwaves, and coastal erosion, which lead to direct economic losses from damaged infrastructure, reduced productivity, and the devaluation of vulnerable assets. Transition risks emerge from the economic shifts required to address climate change, including disruptive new technologies, changing climate policies, and evolving consumer preferences that can rapidly devalue carbon-intensive industries and investments.
The presentation highlighted how these global risks translate to Liberia’s context, where climate-vulnerable sectors form the backbone of the economy. Brown warned that standard financial safeguards remain woefully inadequate, failing to account for cascading failures across interconnected sectors or the long-term devaluation of climate-exposed assets. Current risk assessment methods don’t properly evaluate compound threats, such as simultaneous droughts and supply chain collapses, leaving financial institutions unprepared for the true scale of potential losses.
Calling for immediate action, Brown outlined critical steps Liberia’s financial sector must take to build resilience. These include implementing mandatory climate risk assessments for major loans, developing disaster contingency plans for key economic sectors, creating incentives for climate-resilient investments, and establishing early warning systems for climate-related financial risks. The consultant stressed that Liberian financial leaders now face a historic choice – to proactively address these mounting threats or risk being remembered for failing to act before it was too late.
Moreover, Brown’s presentation made clear that climate finance is no longer just an environmental concern, but rather an urgent economic imperative for protecting Liberia’s financial stability and future prosperity. She highlighted global examples demonstrating the catastrophic potential of climate-related financial crises.
Following the consultant’s presentation, an interactive question and answer session was held among participants. This was followed by a breakout group discussion on the financial and public sectors. A report was made from the breakout groups as well as a roadmap. The Central Bank of Liberia (CBL) was established on October 18, 1999, by an Act of the National Legislature of the Republic of Liberia. It became functional in 2000 and succeeded the National Bank of Liberia (NBL). Mr. Elie E. Saleeby served as the Bank’s first Executive Governor.
The principal objective of the CBL is to achieve and maintain price stability in the Liberian economy. To this end, it seeks to preserve the purchasing power of the national currency; promote internal and external equilibrium in the national economy; encourage the mobilization of domestic and foreign savings and their efficient allocation for productive economic activities; facilitate the emergence of financial and capital markets that are capable of responding to the needs of the national economy, and foster monetary, credit and financial conditions conducive to orderly, balance and sustain economic growth and development.
