New links in the value chain
Returning members of the diaspora and local businessmen are injecting much-needed investment into the country’s weak private sector
Founded in 1948, the Red Lion Bakery still does busy trade selling bread in and around Freetown. It is one of the last of the old guard, and most of the well-known indigenous brands have since shrunk or faded away. Now, the country’s private sector is showing new signs of life, led by a wave of returnees from the diaspora and local business owners.
Dragon Transport, a Freetown-based trading and logistics company, started operations in August 2010. Its agents buy basic produce and transport it from the farm to the market in three refrigerated trucks. Highly perishable goods require refrigeration and without it farmers are not incentivised to produce because so much is wasted. Middlemen also take large cuts. “It’s bad news for our farmers. They have no leverage and they get a very small percentage of the final sales price,” said Dragon Transport’s managing director, Modupe Taylor-Pearce.
A graduate of West Point Military Academy in the US, Taylor-Pearce returned to Sierra Leone to fight in the war and was shot twice. He left to work in the US but decided to return with his family last year. Alongside Dragon Transport and a uniform company run mainly by his wife, Taylor-Pearce is also setting up an amphibious transport business called Salma Watabus, which is due to begin trips from Lungi airport to Freetown this April.
Last year Dragon Transport received $1.1m of investment from ManoCap, a CDC-backed private equity fund. “There’s more opportunity than we’ve been able to take advantage of,” said ManoCap director Tom Cairnes. It has invested $15m in Sierra Leone so far, with plans for another $7m in 2011.?The toll of war still weighs heavily on the business world. “If you lose 10 years, you have a dearth of middle- management talent, which is a real barrier,” says Cairnes, who admits much of the firm’s day-to-day business is in crisis management.
Undeterred, a number of other diaspora returnees have been busy setting up small enterprises. Mantie Cole has set up the Kidszone, a centre for ‘edutainment’ in Freetown, while Karefa Kargbo has opened Shangri La, a restaurant and jazz lounge along the Lumley Beach Road in Freetown.
Kargbo is part of a local push to rebuild the tourism industry. In the 1980s there were hardly any Sierra Leoneans running hotels, says Cecil Williams, general manager of the Sierra Leone tourist board. “Now, Sierra Leoneans are reducing the Lebanese dominance in the tourism sector.” Local entrepreneurs are rejuvenating three boutique resorts – Tokey Beach, Eden Park and Lakka Cotton Club – and Wilfred Sam-King is leading a $2m investment in the Taia Resort Hotel on Lumley beach.
Today’s entrepreneurs are also receiving better business support. Business Bomba, a donor-funded business plan competition run by the African Foundation for Development in Sierra Leone, is now in its second year. It will announce 20 new winners in late April.