世界银行-塞拉利昂经济更新_2025年11月_促进私营部门增长和创造就业机会（英）-2025_52页_4mb

Sierra Leone Economic Update Summary

Core Content

The Sierra Leone Economic Update 2025 provides an in-depth analysis of the country's economic performance and outlook, emphasizing the importance of private sector development for growth and job creation. The report highlights the challenges faced by Sierra Leone in navigating both domestic and global economic conditions, as well as the structural constraints that hinder private sector expansion and macroeconomic stability.

Main Points

1. Economic Growth and Performance

• GDP growth slowed in 2024 to 4.3%, down from 5.7% in 2023, due to weak global demand for minerals, especially from China.
• Mining remains a key sector, accounting for ~8% of economic activity, with iron ore making up ~56% of mining output.
• Agriculture showed a 3.6% yoy growth in 2024, its highest since 2019, supported by favorable rains and processing initiatives.
• Services sector rebounded in 2024, growing by 5.4% after two years of stagnation, driven by retail trade, tourism, and improved regional trade facilitation.
• Industrial activity declined to 3.2% yoy in 2024, due to slow mining and manufacturing expansion, and contraction in construction.

2. Fiscal and Debt Challenges

• Fiscal discipline remains weak, with the overall deficit reaching 5.1% of GDP in 2024, exceeding budget targets for the fourth consecutive year.
• Domestic revenue improved to 9.2% of GDP in 2024, up by 1.8 percentage points, due to tax reforms and enhanced tax enforcement.
• Debt servicing burdens have increased due to short-term domestic borrowings at real interest rates over 10%, raising refinancing costs and fiscal risks.
• Public financial management (PFM) systems are underdeveloped, leading to persistent overspending, weak budget execution, and lack of transparency.

3. Monetary Policy and Inflation

• Monetary policy is dominated by fiscal policy, limiting its effectiveness in curbing inflation.
• Inflation dropped to 5.4% yoy in September 2025, from 29.8% in 2024, due to global price declines and currency appreciation.
• The Central Bank reduced the monetary policy rate by 600 basis points to 18.75% by September 2025 to stimulate private sector credit and investment.

4. Private Sector Constraints

• The private sector is underdeveloped, informal, and undercapitalized, with limited access to finance, land, and utility services.
• Regulatory inefficiencies and weak legal frameworks for land disputes and business insolvency hinder growth.
• Digital infrastructure in land management is underdeveloped, and electronic payments are underutilized by firms.
• Financial inclusion has improved due to mobile money adoption, but remains below regional averages.

5. External Sector and Reserves

• The current account deficit narrowed to 4.7% of GDP in 2024, but international reserves fell to 1.5 months of imports by August 2025.
• The New Leone has appreciated by 5% in real terms in 2024, showing resilience to external shocks.
• Debt service obligations remain elevated, driven by foreign currency expenditures (e.g., payments to Independent Power Producers, foreign embassies, and overseas travel).

Key Policy Priorities

• Strengthen domestic revenue mobilization through tax reforms and enhanced enforcement.
• Improve expenditure controls and public financial management to restore budget credibility and transparency.
• Manage debt sustainably by lengthening maturities and prioritizing concessional financing.
• Rebuild international reserves to enhance external stability.
• Deepen financial sector reforms to reduce fiscal dominance and expand credit access for the private sector.
• Scale up "Feed Salone" and private sector-led agricultural value chains to boost food security, export diversification, and inclusive job creation.

Outlook

• Growth is projected at 4.3% in 2025, and is expected to recover to 4.6% by 2027.
• Global trade uncertainties, health risks, and climate risks continue to pose growth risks.
• Agricultural productivity, mining expansions, and services sector resilience are expected to be key growth drivers.
• Inflation is expected to remain in the single-digit range until 2027 due to declining global food and energy prices and currency stability.

Conclusion

Sierra Leone's economy faces significant challenges in growth and job creation, largely due to weak fiscal discipline, underdeveloped private sector, and external vulnerabilities. To address these issues, the report calls for policy reforms that enhance private sector participation, financial inclusion, and fiscal and monetary discipline, while also leveraging the demographic dividend through inclusive job creation and sustainable development.