Who loses when FDI fails? Local experiences with plantation investment and divestment in Liberia

Abstract

While the merits of foreign direct investment (FDI) in producing economic growth for the host country have been debated, one seldom considered outcome of FDI is failure resulting in divestment. Little consideration has been given to the ways in which foreign divestment impacts local communities. This paper presents a case study of the Sime Darby Liberia plantation using qualitative in-depth interviews with community members surrounding the site. The cycle of investment and divestment has shaped the experiences and livelihoods of people living in the area regarding land concessions, employment, and plantation management transitions. While divestment can create undesirable outcomes for all parties involved, the structures of FDI set local people up to take the biggest losses in the case of FDI failure.