"Within one month our revenues had jumped over 50%."

Trade in Sierra Leone

village market
Sierra Leone is a constitutional representative democratic republic, whereby the President is both the head of state and the head of government. Legislative power is vested by the House of Parliament of Sierra Leone. The Judiciary of Sierra Leone is independent of the executive and the legislative and is headed by the Supreme Court. Sierra Leone had an estimated population of 6.3 million, for 2008, according to the CIA World Factbook. Sierra Leone has a tropical climate, with a diverse environment ranging from savannah to rainforests, as reported by the World Guide. Freetown is the capital, largest city as well as its economic, educational and financial center. The second largest is Bo. Other major cities are Kenema, Makeni and Koidu Town.The country has relied on mining, especially diamonds, for its economic base; it is among the top 10 diamond producing nations in the world, and mineral exports remain the main foreign currency earner. Sierra Leone is also among the largest producers of titanium and bauxite, and a major producer of gold. The country has one of the world’s largest deposits of rutile. Sierra Leone is also home to the third largest natural harbour in the world; where shipping from all over the globe berth at Freetown’s famous Queen Elizabeth II Quay. Despite this natural wealth, over 70% of its people live in poverty, according to Index Mundi. Sierra Leone is slowly emerging from a protracted civil war and is showing signs of a successful transition. Investor and consumer confidence continue to rise, adding impetus to the country’s economic recovery. There is greater freedom of movement and the successful re-habitation and resettlement of residential areas.Sierra Leone is also known for its blood diamonds that were mined and sold to diamond conglomerates during the civil war, in order to buy the weapons that fuelled the atrocities of the civil war, according to BBC News. Annual production of Sierra Leone’s diamond estimates range between $250–300 million. Some of that is smuggled, where it is possibly used for money laundering or financing illicit activities. Sierra Leone’s economic development has always been hampered by an overdependence on mineral exploitation. Successive governments and the population as a whole have always believed that “diamonds and gold” are sufficient generators of foreign currency earnings and lure for investment. As a result, large scale agriculture of commodity products, industrial development and sustainable investments have been neglected by governments. The economy could thus be described as one which is “exploitative” and based on the extraction of unsustainable resources or non-reusable assets.Overall, Sierra Leone is still a poor market to invest in, unless your business is involved in the mining industry. Since independence, the Government of Sierra Leone has encouraged foreign investment, although the business climate suffers from uncertainty and a shortage of foreign exchange because of civil conflicts. Investors are protected by an agreement that allows for arbitration under the 1965 World Bank Convention. Legislation provides for transfer of interest, dividends, and capital. With its small population and low GDP per capita levels, estimated at $780 in PPP terms by the IMF in 2010, Sierra Leone has a very small GDP of only $$4.837 billion. In essence, it is a very difficult country to do trade or business in.

Tags: ,

Author:Globial International Business Team

The Globial International Business Team researches, analyzes, and reports on all things related to global trade and business.

Subscribe

Get our news and articles

No comments yet.

Leave a Reply

CommentLuv badge