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THE SIERRA LEONE ECONOMY IS AT RISK

By Titus Boye-Thompson

 

The global economic crises played havoc across the Western world with dire consequences for households and business. Jobs and homes were lost and the damage to savings and investments severely inflicted social and political fabric of those societies. These problems resulted in socioeconomic tensions with fragile governments managing failing economies prone to collapse, especially across Europe. In Africa where the poorest countries are concentrated, the dependence on foreign direct investment has opened the continent to the vagaries of international markets.

While commodity prices soared, the producing Countries were prohibited from benefitting from increased margins due to locked in arrangements and contracted purchasing and royalty regimes. On the other hand, significant proportions of the expanded margins on world market prices for commodities were eaten up by higher borrowing and interest rates cost and stringent loan to capital ratios for maintaining large producing plants, equipment and technologies.

All in all, whilst Africa produced the raw materials for high end technological items, the Continent was hampered from feeding itself because of low agricultural yields and end prices for internationally processed food items impacted by spiralling oil prices. Africa therefore became locked in a double whammy, unable to increase its income from widening margins for raw materials and constrained by higher prices of finished goods, unable to feed its populations and hence locked into a cycle of poverty.

Sierra Leone shares similar characteristics with other Countries in the continent with identical economic and strategic environment so is therefore not immune to the adverse conditions facing the Continent. Additionally, Sierra Leone has to contend with being an emerging economy in a fragile state with all the attendant drawbacks of a post conflict environment. This means that insurance costs for investing or operating in this Country remains prohibitive. With such costs to reckon with, the movement of goods and people was none the least problematic. In the event, it was much more expensive to take a flight to Sierra Leone from London than to any other destination in West Africa. The same can be said for freight of goods and materials with higher insurance at Lloyds for vessels docking at Freetown Ports.

 

It may be argued that the previous Government of President Tejan Kabba have a lot to answer for the management of the economy and for the failure in moving Sierra Leone out of its post conflict stage fast enough. That failure was characterised by the unanimous decision of international donor communities and development partners to withdraw or otherwise ceased funding of projects in Sierra Leone at a critical time prior to the 2007 elections. Their main reason for that action has now been made clear that probity and accountability in the management of public finances were problematic to say the least and moreover, it became clear at some point that corruption was so rampant that regime change offered the best opportunity for consolidation of the democratic gains that had been secured by the end of the civil war.

 

There is also another consideration, that the International Community would have bought the arguments proffered by the then leader of the opposition party, the All Peoples Congress, Ernest Bai Koroma that he offered a better route out of the economic malaise through his vision for an Agenda for Change, the context and content of the election manifesto offered by the APC Party in 2007. Additionally, the growing public hostility towards what was widely seen to be a corrupt regime was confounded by the increasing realization that a more sustainable alternative had presented itself in the stature of the APC and its Leader, Ernest Bai Koroma and the overwhelming outcry was for regime change in the face of a more compelling and popular dispensation. In the event, the situation that currently exist cannot be compared to the pre 2007 era because significantly,  there is no outcry for change as was so evident in 2007, rather, President Bai Koroma is applauded as a World’s best!

 

While the opposition may be tempted to refer to the price of rice as an indication of bad management of the economy, what they are admitting to without realizing is that the price of rice, compared with what now obtains in producer countries and extrapolated to include freight and other insurance costs, final mile costs to markets etc ought to be well over the current price that obtains in Sierra Leone but for the prudent management of the macro-economy. The Ernest Bai Koroma Government has been able to suppress further increases in commodities prices due to robust public finance management, effective fiscal policies with transparent taxation and public expenditure profiles. For the first time in a long while, a Government in Sierra Leone is investing in the Country’s infrastructure with funds generated and collected locally. In the event, the economy is growing and that growth is being expended for the benefit of the whole Country. ‘

 

Roads and bridges, ports and jetties are being built and refurbished all over the Country and not just in areas considered as strongholds of the All Peoples Congress Party. For the first time in a long while, a Government in this Country is investing side by side with international development partners to secure availability of free health care to pregnant women and lactating mothers thereby reducing the infant and maternal mortality in the Country and significantly moving the Country up from the dire position of being last in the world according to the UN Human Development Index.

 

What this translates to is more and better roads with remote parts of the Country being opened up so that increased agricultural yields are processed and sold in local markets. This also means that we are now a healthier nation, with much less of our people dying when they try to give birth or fewer of our children not being allowed to reach their full potential as constructive citizens of this Country due to early and untimely death.

 

There should therefore be no argument whatsoever that economic growth that has not happened in this Country in the last five years. So when those who do not understand global economic theory or the practical implications of the synchronistic workings and intricate interactions within a global market utter the inane statement that rice has risen up from the level that this Government met it in the past five years, they ought to be told to put up or shut up because it is clear that the price of rice in Sierra Leone has been constrained by a sound and robust fiscal and monetary policy together with prudent public finance management than it would otherwise have been.

 

In a few words, the price of rice would have risen even if the SLPP were still in power and there is nothing they could have done about it. In fact, from the experience of their previous tenure of office, this Country would have suffered a much larger increase in the price of rice were they still in power. In the event, the Sierra Leone economy is at a greater risk if the SLPP is allowed to take over power by winning the November 2012 elections.

The record of the opposition flag bearer does not augur well for any assurance of prudent financial management but all indications going by past experience of their stewardship denotes a regime more attuned to plundering of the State treasury. They would sell off the resources of this Country for their private benefit just the same way as they sold off passports and accepted the proceeds in their private bank accounts.

 

They would have no breech for human rights and justice just the same way that they presided over the extra-judicial killings of 29 innocent Sierra Leoneans on a flimsy allegation of some sort. They would sign off authority to make arms deals to civilian relatives thus putting the Country in grave danger of conflict, spiralling debt and unenforceable contracts. They would put this Country in danger as much as they put the economy in danger and what have been built up over the past five years will go up in smoke.

 

The only way to stop this is for Sierra Leoneans to vote in a President who has promised to do more for his Country. To do more in bringing investment to our mining sector, agriculture and other sectors, to do more in securing the gains from this Country’s resources for the benefit of all. To do more in securing the peace and development now being consolidated by sound and robust principles and practice.

 

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