SIERRA LEONE maq 4ª.indd - agrilife - Europa
SIERRA LEONE maq 4ª.indd - agrilife - Europa
SIERRA LEONE maq 4ª.indd - agrilife - Europa
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2 Description of the Context in Sierra Leone<br />
26<br />
Figure 3. Economic Growth in Sierra Leone (percentage change of GDP)<br />
Source: The World Bank: World Development Indicators 2009.<br />
766 US$ PPP 5 in 2008, Sierra Leone remains<br />
not only one of the (economically) smallest and<br />
poorest, but it would seem that Sierra Leone is not<br />
particularly efficient in converting its economic<br />
resources into social well-being (UNDP, 2009).<br />
Lastly, its Human Poverty Index (HPI-1) of 47.7%<br />
reaches position 128th out of 135 countries<br />
(UNDP, 2009). According to the 2004 Integrated<br />
Household Survey (SLIHS, 2007) 70% of the<br />
population was living in poverty and 26% in<br />
extreme poverty. Given these figures and the<br />
general conditions of the country, UNDP (2007,<br />
xii) argues that Sierra Leone will not be able to<br />
reach the Millennium Development Goals.<br />
Regarding other key macroeconomic<br />
variables6 it is worth highlighting that while<br />
economic growth has been impressive,<br />
particularly in the early years of the 2000´s,<br />
Sierra Leone has struggled to control inflation.<br />
5 The 2008 estimated GDP per capita varies according to the<br />
multiple sources: 350 US$ (PRSP II, 2009), 725 US$ (IMF,<br />
2009).<br />
6 National data for key economic indicators should be<br />
carefully considered since there are still shortcomings<br />
in the collection and estimation of balance of payments<br />
and national accounts data. Although the authorities are<br />
cooperating fully in providing and disseminating data,<br />
efforts should be maintained to improve the timeliness and<br />
quality of economic and financial data (IMF, 2009).<br />
Both, increased food and oil prices accelerated<br />
inflation in 2007 and throughout 2008. The 12<br />
month inflation rate for June 2008 increased to<br />
16.8 percent from 13.8 percent in December<br />
2007 and 8.3 percent in December 2006. More<br />
specifically, according to data from Statistics<br />
Sierra Leone, Freetown consumer prices for<br />
imported rice showed an accelerating rate of<br />
inflation: the cost of imported rice in December<br />
2007 was 21 percent higher than in the<br />
preceding December while the June 2008 price<br />
was 49 percent higher than the preceding June.<br />
The Government tried to limit some of these price<br />
increases in 2008 by reducing import tariffs on<br />
rice, flour, and petroleum products (World Bank,<br />
2009). However, the external current account<br />
deficit (including official transfers) increased<br />
to 8.4% of GDP in 2008 (World Bank, 2009)<br />
from 3.5% of GDP in 2006 following a slight<br />
deterioration in the terms of trade (IMF, 2009).<br />
At the end of September 2008, official reserves<br />
declined to 212 million US$ (or 4.6 months of<br />
import coverage) (IMF, 2009) 7 .<br />
The main challenges to economic growth<br />
are poor infrastructure, including lack of access<br />
7 Estimated at 209 million US$ or 5.1 months by the World<br />
Bank (2009).