Sierra Leone economy is projected to expand by 6 percent in real terms in 2017 during a discussion by IMF Staff to initiate a possible IMF-supported financial arrangement for the country.
Though the macroeconomic situation remains challenging, the IMF team states they welcome the authorities’ plan to enhance domestic revenue, while increasing public investment aimed at reducing social and infrastructure gaps.
The outcome of the discussion is that the economy proved resilient in the face of two major exogenous shocks: the Ebola epidemic and collapse of iron ore prices and associated loss of production in 2014-2015.
An International Monetary Fund (IMF) team led by John Wakeman-Linn visited Freetown from March 14-28, 2017, to initiate discussions on a possible Extended Credit Facility arrangement that could be supported by the IMF.
At the conclusion of the visit, Mr. Wakeman-Linn said renewed iron-ore exports contributed to a strengthening of the trade balance, but it was not enough to compensate for the decline in donor support. As a result, the current account deficit is estimated to have widened from 17.5 percent in 2015 to 19.9 percent in 2016.
“Against this backdrop, the authorities aim to safeguard macroeconomic policy and institute a package of structural reforms that place the country on a sustained path toward economic diversification and growth, employment creation, and improved social conditions, consistent with the objectives of the Agenda for Prosperity and the Sustainable Development Goals (SDGs).
“The IMF team welcomes the authorities’ plan to enhance domestic revenue while increasing public investment aimed at reducing social and infrastructure gaps. Staff support the plan to take decisive steps to increase the efficiency, effectiveness, transparency and accountability in the use of public resources, while strengthening social protection for the most vulnerable,” he said.
The team met with President Koroma, Minister of Finance, Momodu Kargbo, and Minister of State for Finance Patrick Conteh; the Deputy Governor of Bank of Sierra Leone, Dr. Ibrahim Stevens, senior government and BSL officials, representatives of the financial sector, private sector, civil society, and development partners.