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publicationDecember 15, 2022

Sierra Leone Poverty Assessment: Poverty Trends, Development, and Drivers

Sierra Leone Poverty Assessment 2022


  • The new poverty assessment for Sierra Leone says the country faces many challenges in improving the welfare of citizens, but that urbanization offers an opportunity to improve living standards and reduce poverty among the population.
  • The analysis offers several recommendations including the need to invest in secondary cities, which could have considerable effect on poverty reduction and economic growth.
  • The report also provides several reform priorities for government consideration, including increased investment in education provision and quality to help citizens access more formal opportunities, thus enabling firms to expand and demand more skilled employees.

FREETOWN, December 15, 2022 – Urbanization presents an opportunity to promote productivity, improve living standards, expand markets efficiently and reduce poverty in Sierra Leone, but only if the right policies are in place to maximize its potential, according to a new World Bank poverty analysis for Sierra Leone.

The 2022 Sierra Leone Poverty Assessment, Poverty Trends, Development, and Drivers, notes that increased investment in education provision and quality can help more Sierra Leoneans access formal opportunities, while at the same time investment is needed to ease the production constraints faced by firms so that productivity can improve and enable firms to expand and demand more skilled employees. In 2020, an estimated 44 percent of Sierra Leone’s population lived in urban areas. Poverty has been declining more rapidly in urban areas than in rural areas even as urbanization only partially reflects ‘push’ factors (such as lack of services) in rural areas rather than ‘pull’ factors (such as rapid job creation in manufacturing) in urban areas. The report found that poverty reduction has likely stagnated or even reversed during the height of the COVID-19 pandemic as estimates show that GDP contracted by more than 2 percent in 2020 due to imposed mobility restrictions, which mostly affected the service sector.

“The increasing concentration of poverty in less economically vibrant areas seems to signify that macroeconomic developments and structural changes in the economy are the first place to start in unpacking the drivers of welfare improvements in Sierra Leone. So, the key message of this report is that, with prudent policies in place, the forces of urbanization can be leveraged to maximize living standards thereby reducing poverty among the populace,” said Paul Andres Corral Rodas, World Bank Senior Economist and lead author of the report.

The report indicates that poverty fell by about 6 percentage points between 2011 and 2018—a significant achievement given that iron ore prices crashed in 2016 and the country suffered from an Ebola outbreak. The gains in poverty reduction were achieved exclusively in urban areas. However, the rural population remained impoverished. Extreme poverty in rural areas rose from 9 percent to 13 percent, although it remained unchanged nationally. The growth elasticity of poverty fell from -0.9 to -0.7—meaning in the latter period, for every one percent increase in GDP per capita, poverty fell by 0.7 percent. Moreover, the increase in mining did not indicate structural transformation since there were little or no spillovers into other parts of the economy. During this period, Sierra Leone’s economy became more dependent on agriculture—a pattern that differs from other developing countries.

While prudent policy measures are being undertaken to increase growth and improve welfare, the report also recognizes the major role the government has in providing basic services as well as initiating policies that can sustainably transform the economy. It provides recommendations in several areas and key reform priorities include:

  • Closing the gaps: this is to ensure all Sierra Leoneans – regardless of where they are born – have access to adequate services and opportunities to improve their livelihoods
  • Invest in secondary cities: these could offer a higher return on investment to government as investment can reach a much higher percentage of the poor at a lower cost. This could also yield considerable poverty reduction as well as economic growth
  • Increase investment in education and skills: increased investment in education provision and quality can help more Sierra Leoneans access formal opportunities; accessing formal employment in cities means rural Sierra Leoneans will likely have to acquire more education and skills
  • Lack of basic amenities affects growth: lack of infrastructural amenities such as access to electricity limit job creation and hamper poverty reduction. It also leads to considerable losses to businesses. Therefore, improving access to electricity and other facilities such as water, sanitation could improve people’s wellbeing

In addition to investing in poverty reduction, the report identifies that despite informal jobs being an effective avenue for job creation and poverty reduction, these are not long-term solutions and are unlikely to spur economic transformation. They can serve as short- to medium-term coping strategies in the face of shocks, but formal employment is a viable path towards escaping chronic poverty.