NewsWest AfricaSierra Leone: Slow transformation in Freetown

Thu,23Nov2017

Posted on Friday, 30 August 2013 08:55

Sierra Leone: Slow transformation in Freetown

By Gemma Ware in Freetown

A decade after the civil war ended, Freetown is rebuilding/Photo©Getty ImagesSix months after his election for a second term, President Ernest Bai Koroma is telling the population to be patient as new iron-ore mines and a drive for oil exploration improve the economy more slowly than predicted.

 

As the rainy season arrives, the streets of Freetown are beginning their transformation from sunny and dusty thoroughfares to fast-flowing rivers of muddy red water.

The country's economic growth has been like one of those early rainstorms: despite a flood of high percentages, most of the benefit has been quickly absorbed by a country thirsty for jobs and investment.

Running on promises of job creation and infrastructure spending, President Ernest Bai Koroma and his All People's Congress (APC) were re-elected for a second term in November 2012 with 58.7 percent of the vote. It was a largely peaceful poll, praised by international observers.

Impressive as it still is, it could have been better

"Naturally we're relieved that we've won," says Koroma's chief of staff, Richard Konteh, "but we have a challenge in en- suring that we keep our people happy, that we fulfil the mandate that we set out for ourselves to achieve."

However, as in neighbouring Ghana, the opposition Sierra Leone People's Party (SLPP) and its candidate Julius Maada Bio, a former junta leader, challenged the results, filing a petition at the end of November against national election commissioner Christiana Thorpe and the APC on the basis of ballot stuffing and irregularities in vote counting.

The supreme court threw out the case on 14 June on proceedural grounds. Bu-Buakei Jabbi, a barrister and SLPP member of parliament, believed the party had "ample evidence" to win the case.

As The Africa Report went to press, the SLPP leadership was considering its next move. The party – itself in the midst of reorganisation – was divided over taking the case to court.

Fuelled by revenue from foreign investment in iron-ore and diamond mines, Sierra Leone's economy grew 15.2% in 2012, according to the central bank, which expects growth to slow to 13.2% in 2013.

"Impressive as it still is, it could have been better," says Bank of Sierra Leone governor Sheku Sesay. The government's original prediction was 52%, but companies only produced half as much iron ore as was projected and ore prices plummeted. "Luckily, we did not make over-ambitious expenditure expectations," he says.

Inflation, which stood at 16.6% in 2011, fell to 11.4% in 2012.

Most Sierra Leoneans have seen little of this new growth. The middle-class consumerism sweeping the continent is yet to arrive.

While the number of people living in absolute poverty in urban areas dropped to 30% between 2003 and 2011, 72% of the rural population still lives on around $30 per month.

No jobs for youth

In an alleyway off Wilkinson Road in Freetown next to the new building housing the five-month-old National Minerals Agency, two young men are studiously hammering away at the chain of a broken generator.

Watching on, Milton Sam, a 38-year-old pastor and former carpenter, says things are hard.

"We have all these minerals, but they are not actually capacitating the economy of this country," he says. "There are no jobs for the youth. Young guys are doing nothing," Sam says, bemoaning the standard of education for his two young children. "[The President] is trying but he needs to do more."

The government has spent much political energy since the election on drawing up the Agenda for Prosperity, a five-year poverty reduction-strategy that follows the Agenda for Change.

A draft seen by The Africa Report set a target for Sierra Leone to achieve middle-income status by 2035, which would require the economy to triple in size.

New borrowing strategy

With less money than expected for now, the government is looking for new ways to keep its promises and is pinning its hopes on the private sector.

Finance minister Kaifala Marah implemented a 'no new domestic borrowing' rule in January that has dramatically lowered interest rates on domestic debt in an effort to stimulate commercial bank lending to the private sector.

"The strategy is to is- sue a long-term bond," Marah says, and he is looking to launch a 200bn leone ($46m) infrastructure bond "sometime in July".

The government is also planning to establish a sovereign wealth fund, called the Transformation and Development Fund (TDF).

"There will be special procedures for ensuring that TDF expenditure only goes towards projects and programmes which meet pre-determined criteria for bringing about transformation and development," says Marah.

Mineral revenue is still small and substantial oil revenue is still a long way off. Last year's awarding of eight offshore blocks raised eyebrows when the government put some bidders together in forced marriages.

Kosmos Energy, which won a block with African Petroleum, a venture backed by Romanian-Australian businessman Frank Timis, quietly pulled away.

Adekunle King, senior legal officer at the Petroleum Directorate, admits the government could have received more money if it had waited until finds in four existing blocks became commercially viable.

Anadarko and its partner Tullow are still assessing data. "[The new licences] increased the government take," says King, explaining that the previous four blocks came without government stakes and signature bonuses.

On the political agenda is a review of the 1991 constitution, which is expected to take around two years.

State House strongly denied that Koroma was eyeing changes to allow him to run for a third term in 2018. Other reforms include a review of the public procurement act, a freedom of information bill and ongoing reform of the public sector.

Privatisation will also be another tool to raise cash. So far the government has chosen management contracts rather than outright privatisation: Lebanese firm MDIC manages state-owned telecoms firm Sierratel and French group Bolloré runs Freetown's container terminal. The government intends to list its 51% shareholding in Rokel Commercial Bank on the fledgling stock exchange, but progress on other privatisation deals has stalled.

Struggling on many fronts

Sierra Leone's private sector has struggled to take advantage of foreign investment. "There's not a single Sierra Leonean bank funding anything in the mining sector," says Claudius Bart-Williams, chief executive of consultancy Pennarth Greene.

Although a couple of local companies are winning contracts in the extractive sector, such as drilling company EDAL and engineering group CEMMATS, they are the exception. Onlookers suggest the government is sensitive about losing control.

During the war years it was locally-owned businesses that sustained the country when foreign firms fled.

International donors still play a large role. They consult on and help to draft key government policy documents. They also provide a large share of government financing: 22.2% of total revenue in 2013.

A milestone is approaching in March 2014: the United Nations (UN) Integrated Peacebuilding Office, which has helped manage the post-conflict transition since Sierra Leone's civil war ended in 2002, is due to complete its draw down. It will transfer many of its responsibilities to the UN Development Programme.

Sierra Leone will struggle to meet the UN Millennium Development Goals (MDGs) by 2015.

There was a 29.6% reduction in infant mortality between 1990 and 2010, although it is still the highest in Africa, at 114 per 1,000 deaths, according to the 2012 progress report on the MDGs.

The maternal mortality rate is also one of the highest, with 857 out of every 100,000 women dying in childbirth. A free maternal healthcare programme is making progress, but poor rural roads mean women often get to clinics too late.

The poor performance of the health system was compounded by the disappearance of more than $1m earmarked for vaccinations from the GAVI Alliance between 2008 and 2012, causing the programme's suspension.

Anti-corruption commissioner Joseph Kamara indicted 29 people, and cases are progressing well through the courts.

Kamara explains that there were 29 convictions and 13 acquittals for corruption cases in 2012. He says he is frustrated with the treatment of cases by the judiciary, most recently in the case of Momoh Kemoh Konte, a vice-presidential aide on trial for taking a bribe in last year's 'Timbergate' scandal, who was acquitted in late May.

On 6 June, the courts handed down two custodial sentences to officials from the finance ministry. They were the first custodial sentences for corruption since 2004.

But a Ugandan judge, one of two Commonwealth judges working in Sierra Leone, delivered them. "The fact speaks for itself," says Kamara. ●



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