Economic Outline

flag Sierra Leone Sierra Leone: Economic Outline

Economic Indicators

For the latest updates on the key economic responses from governments to address the economic impact of the COVID-19 pandemic, please consult the IMF's policy tracking platform Policy Responses to COVID-19.

Sierra Leone’s economy was hit by various shocks these last years, including the Ebola epidemic (more than 14,100 cases, 3,900 deaths and a revenue loss equivalent to 29% of the country’s GDP according to the WHO), the drop in the prices of iron ore, the Covid-19 pandemic and the war in Ukraine. After rebounding to 4.1% in 2021, driven by the resumption of investment in mining activities and private consumption GDP growth slowed down to 2.8% in 2022, due to a deterioration of the terms of trade and increased uncertainty about global economic prospects (IMF). According to IMF forecast, GDP growth should strengthen to 3.1% in 2023 and 4.8% in 2024, driven by higher iron ore production. Growth will also be supported by private consumption, the recovery of agriculture and expatriate remittances (Coface).

In 2022, as Sierra Leone’s economy was still recovering from the effects of the Covid-19 pandemic, it was severely impacted by spillovers from the war in Ukraine and higher inflation, which exacerbated the already-limited fiscal space, increased debt, and reduced external buffers (IMF). High fuel, food and fertilizer prices, combined with the depreciation of the Leone (60% during 2022), pushed inflation to 27.2% in 2022, up from 11.9% in 2021 (IMF, World Bank). It is expected to further soar to 37.8% in 2023 before decreasing to 25.9% in 2024 (IMF). Inflation will thus remain well above the 10% ECOWAS convergence criterion. Fiscal deficit worsened from -7.3% GDP in 2021 to -10.9% GDP in 2022, due to additional priority spending in response to social pressures and stability concerns (IMF). Fiscal consolidation efforts should help bring the deficit down to -6.2% GDP in 2023 and -2.9% GDP in 2024 (IMF). Due to the cost of domestic debt, concessional loans are given priority to finance the deficit (Coface). Public debt rose from 79.3% GDP in 2021 to 98.8% GDP in 2022, and while it is expected to decrease, it will remain very high in 2023 (92.2% GDP) and 2024 (84.9% GDP) (IMF). Sierra Leone remains at high risk of debt distress. The 2023 budget will prioritise programmes and policies that will enhance economic resilience and protect the livelihoods of the most vulnerable. The government is committed to the IMF program supported by the Extended Credit Facility arrangement. Its main objectives are revenue mobilization, safeguarding financial stability, and addressing external vulnerabilities (IMF). The government will also continue to implement the National Development Plan (NDP), which gives priority to macroeconomic stability, infrastructure development and the maintenance of key social programmes (free education, health, social protection). The National Agricultural Transformation Programme 2019/2023 aims to double agricultural production.

Unemployment (3.7% of the workforce in 2021 according to the World Bank, modeled ILO estimate), high poverty levels (especially in rural areas) and lack of infrastructure, corruption as well as social unrest continue to hamper the country’s economic development. Unemployment among young people reached 50% and more than 90% of the population has a vulnerable job. The Human Development Index ranks Sierra Leone 181st out of 191 countries. The country has to pave the way forward in the post-Ebola and post-Covid-19 period, which has been marked by an increase in poverty and social tensions, exacerbated by inflation and austerity measures.

 
Main Indicators 20222023 (E)2024 (E)2025 (E)2026 (E)
GDP (billions USD) 3.993.523.613.743.97
GDP (Constant Prices, Annual % Change) 4.02.74.75.24.5
GDP per Capita (USD) 480415417423440
General Government Gross Debt (in % of GDP) 95.888.982.679.073.5
Inflation Rate (%) n/a42.929.819.314.6
Current Account (billions USD) -0.35-0.24-0.25-0.21-0.24
Current Account (in % of GDP) -8.8-6.8-7.0-5.7-6.1

Source: IMF – World Economic Outlook Database - October 2021.

Note: (e) Estimated Data


 
Monetary Indicators 20152016201820192020
Leone (SLL) - Average Annual Exchange Rate For 1 MUR 144.93174.48233.73253.81249.80

Source: World Bank - Latest available data.

 

Main Sectors of Industry

 
Breakdown of Economic Activity By Sector Agriculture Industry Services
Employment By Sector (in % of Total Employment) 42.7 11.9 45.4
Value Added (in % of GDP) 57.4 5.9 32.3
Value Added (Annual % Change) 2.5 17.4 2.9

Source: World Bank - Latest available data.

 

The Active Population in Figures

201820192020
Labour Force 2,615,2352,681,0782,717,263

Source: International Labour Organization, ILOSTAT database

 
201720182019
Total activity rate 58.95%58.90%58.80%
Men activity rate 58.93%58.71%58.39%
Women activity rate 58.97%59.09%59.22%

Source: International Labour Organization, ILOSTAT database

 

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Indicator of Economic Freedom

Definition:

The Economic freedom index measure ten components of economic freedom, grouped into four broad categories or pillars of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labour freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom). Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms.

Score:
51,7/100
World Rank:
150
Regional Rank:
34

Economic freedom in the world (interactive map)
Source: Index of Economic Freedom, Heritage Foundation

 
 

Country Risk

See the country risk analysis provided by Coface.

 

Indicator of Political Freedom

Definition:

The Indicator of Political Freedom provides an annual evaluation of the state of freedom in a country as experienced by individuals. The survey measures freedom according to two broad categories: political rights and civil liberties. The ratings process is based on a checklist of 10 political rights questions (on Electoral Process, Political Pluralism and Participation, Functioning of Government) and 15 civil liberties questions (on Freedom of Expression, Belief, Associational and Organizational Rights, Rule of Law, Personal Autonomy and Individual Rights). Scores are awarded to each of these questions on a scale of 0 to 4, where a score of 0 represents the smallest degree and 4 the greatest degree of rights or liberties present. The total score awarded to the political rights and civil liberties checklist determines the political rights and civil liberties rating. Each rating of 1 through 7, with 1 representing the highest and 7 the lowest level of freedom, corresponds to a range of total scores.

Ranking:
Partly Free
Political Freedom:
3/7

Political freedom in the world (interactive map)
Source: Freedom in the World Report, Freedom House

 

Indicator of Freedom of the Press

Definition:

The world rankings, published annually, measures violations of press freedom worldwide. It reflects the degree of freedom enjoyed by journalists, the media and digital citizens of each country and the means used by states to respect and uphold this freedom. Finally, a note and a position are assigned to each country. To compile this index, Reporters Without Borders (RWB) prepared a questionnaire incorporating the main criteria (44 in total) to assess the situation of press freedom in a given country. This questionnaire was sent to partner organisations,150 RWB correspondents, journalists, researchers, jurists and human rights activists. It includes every kind of direct attacks against journalists and digital citizens (murders, imprisonment, assault, threats, etc.) or against the media (censorship, confiscation, searches and harassment etc.).

World Rank:
75/180

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Sources of General Economic Information

Useful Resources
Ministry of Finance
Ministry of Energy
Ministry of Agriculture
National Minerals Agency
Central Bank of Sierra Leone
 
 

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Latest Update: December 2023