Sierra Leone’s economy proved resilient in the face of two major shocks in 2014/15: the Ebola epidemic and collapse of iron ore prices. Economic growth has resumed, however, and remains upward, supported by new investments in mining, agriculture, and fisheries. The recovery underway, according to International Monetary Fund projections, is expected to remain sustainable over the medium term.
Real Gross Domestic Growth (GDP) is projected to recover from -20.6% in 2015 to 5.4% in 2017.
However, Consumer Price Inflation continues to rise on account of exchange rate pass-through and accommodative monetary stance. Rising from a base of 9.5% in December 2015, inflation reached 17.41% in December 2016. Exchange rate pressures remain unabated. The local currency (the Leone) had depreciated by 28.73% in December 2016 (year-on-year). The Bank of Sierra Leone has increased its weekly foreign exchange auction from $1 million to $3 million since June 2016. This notwithstanding, it has been able to maintain foreign exchange reserves to at least 3.5 months.
The overall fiscal balance (excluding grants) was projected to recover slightly from -9.6% of non-iron ore GDP in 2015 to -8.1% in 2016. Total domestic revenue collection for 2017 is projected at Le3.5 trillion, up from Le2.68 trillion set in 2016.
The IMF projects medium-term growth to pick up to around 6.5% by 2020 from 4.3% in 2016. Inflation is projected to decline to 7.5% by 2020.
In 2012, Sierra Leone conducted its third democratic elections since the end of the 11-year civil war in 2002 that claimed the lives of over 50,000 Sierra Leoneans. President Ernest Bai Koroma is serving his second and final term, which ends in 2017. Elections will be held on March 7, 2018.
The 1991 Constitution is being reviewed and a draft has been presented by the Constitutional Review Committee (CRC). The government is drafting a White Paper on it, which will be tabled in Parliament for ratification. Once Parliament has enacted the new Constitution, a referendum to vote on the new Law will take place.
A national census, the research for which was conducted in 2015, put the country’s official population at 7,092,113.
The government has proclaimed the de-amalgamation of chiefdoms and an attendant re-division of the Northern Region into two distinct regions, namely: Northern Region and North-Western Region. This will bring the number of regions in the country to five from the initial four. However, the division is not expected to increase the number of constituencies in that part of the country. The National Electoral Commission (NEC), which is mandated to delimit constituencies, will not use this division for any fresh boundary delimitation process.
Moreover, the two Northern Regions will now consist of seven electoral districts in place of the previous five. The North-West Region covers Port Loko,
Until the outbreak of Ebola in May 2014, Sierra Leone was seeking to become a transformed nation with middle-income status, but the country still has high youth unemployment, corruption, and weak national cohesion. It continues to face the daunting challenge of transparency in managing its natural resources and its fiscal policy. Problems of poor infrastructure and widespread rural and urban impoverishment persist in spite of progress and reforms.
Last Updated: Apr 20, 2017