#SierraLeone has been receiving financial support from the International Monetary Fund
@IMFNews to help improve its economy. Recently, the IMF completed its sixth and seventh reviews and decided to continue providing assistance until November 2023. As part of this extension, Sierra Leone received $20.7 million.
However, the IMF also pointed out some of the economic challenges that Sierra Leone is facing. These challenges include rising prices, a decrease in the value of the country’s currency, and a high level of debt compared to its economic output.
One of the problems is that the government has been borrowing a lot of money from banks, which has made it harder for ordinary people and businesses to get loans. Banks prefer lending to the government because they think it’s a safer investment. This means that people and businesses have less access to funds, and it can also drive-up interest rates.
The government has been spending more money than it is generating in revenue. A significant portion of the money the government collects from taxes and other sources is used to pay wages and interest on loans. This leaves very little money for other important government activities, like building infrastructure or providing services.
The government’s spending on wages and salaries has been increasing every year, which has contributed to the problem. They have also been borrowing money to finance their activities. This excessive spending and borrowing have led to a high level of debt, which means a large part of the country’s income goes toward repaying these debts.
As a result of all this, prices have been going up rapidly, making it harder for people to afford basic necessities. The value of the country’s currency has also been decreasing, which makes it more difficult for businesses to buy goods and services from other countries.
It’s important for Sierra Leoneans to understand that although the government celebrated the completion of the IMF reviews, there are still significant challenges to overcome. The government did not meet certain targets set by the IMF, and waivers had to be approved to allow the program to continue. The IMF has also asked the government to implement policies that could further burden the private sector, which is already heavily taxed.
The truth is, Sierra Leone’s economy is facing difficulties, and it’s important for the government and the people to work together to address these challenges and improve the country’s financial situation.
read the IMF statement: https://imf.org/en/News/Articles/2023/06/05/pr23196-sierra-leone-imf-exec-board-completes-6th-7th-rev-under-ecf-arrangement