Sierra Leone sees IMF support as crucial to luring investors
Sierra Leone is counting on its program with the International Monetary Fund to attract infrastructure investments and revive an economy that’s struggling to recover from the worst-ever outbreak of Ebola.
The government of President Julius Maada Bio resumed an agreement with the Washington-based lender for a $172 million extended credit facility in December after an earlier deal with the administration of his predecessor, Ernest Bai Koroma, stalled because it didn’t meet the program’s targets.
Plagued by chronic corruption, double-digit inflation and the legacy of a civil war, economic growth probably stalled at 3.7 percent last year and has persistently failed in recent years to match expansion of as much as 21 percent prior to the outbreak of the Ebola epidemic in 2014. Growth may see a slight improvement to 5.4 percent this year, according to the IMF.
“We have to shed that image of Ebola and the war and the other calamities of the past,” Maada Bio said Tuesday in an interview with Mike McKee on Bloomberg Television. “We encourage serious investors from around the world that Sierra Leone is the place to be.”
Once one of the great hopes of West African mining, the nation was hit by the iron-ore price collapse and the Ebola epidemic around the same time. While BSG Resources Ltd., controlled by billionaire Beny Steinmetz, is working to revive the Koidu mine that has produced some of the most valuable stones in the world, Sierra Leone has few other sources of foreign revenue.
Maada Bio, 54, who briefly ruled as head of a junta during a protracted civil war in the 1990s, won elections in March last year after a tight race against the candidate of the party that was led by Koroma for almost a decade.
His government will be up to the “humongous” task of bringing down inflation, which was 17.5 percent year-on-year in December, Maada Bio said. Consumer price growth probably won’t lower to single digits before 2022, according to the IMF.
“We are working very hard to bring macro-economic stability,” he said. “We are up to the task.”
(By Andre Janse van Vuuren)