Guidance

Overseas Business Risk: Sierra Leone

Updated 4 July 2019

1. General Overview

Foreign Office Travel Advice on Sierra Leone is regularly updated and should be your primary source of information before travelling to Sierra Leone.

Sierra Leone has strong historic links with the UK, going back to the founding of Freetown in 1792. Sierra Leone, originally ’Sierra de Lyoa’ meaning ’Lion Mountains’, is a country roughly the size of Wales on the west coast of Africa. To the north and east is Guinea. To the south is Liberia.

Approximately one third of the 7m population live in the capital, Freetown and the surrounding western area peninsula. Freetown is serviced by Lungi International Airport (most commonly reached by boat transfer).

Pre-Ebola the economy was expanding significantly, driven by new iron ore extraction, with growth at 20.7% in 2013. The combination of the collapse in iron ore prices and the Ebola outbreak saw GDP growth fall to 4.6% in 2014 and the economy contracted by 20.5% in 2015. The economy has recovered slowly since (growing 3.5% in 2018).

2. Political

Sierra Leone has enjoyed political stability following the end of the civil war. The 2018 Presidential, parliamentary and local elections were seen by the international community as credible, free and fair, with a largely calm and peaceful transition of power from the All People’s Congress to the Sierra Leone People’s Party. The President has made education a focus, launching a Free, Quality Education initiative. Restoring economic stability and improving government finances has also been given high priority.

With a strong executive, the state is highly centralised, with most decisions taken by the lead Minister individually, or by the President directly. There remain grievances between the main parties about the results of the election and there have been concerns the judiciary did not handle these in an independent manner. The government has suggested that it will devolve power to the local level, but no detailed policy proposals have yet been made.

Complicated interrelationships between traditional and democratic structures can be difficult to navigate, leading to disputes over land ownership, workers’ rights and community development programmes. Many successful companies use local partnerships to understand how these groups interact.

3. Human Rights

The most significant human rights problems include a lack of access to justice; and widespread official corruption in all branches of government.

Other major human rights problems include heavy-handed treatment by police; discrimination and violence against women and girls, including widespread female genital mutilation (FGM); early and forced marriage; official and societal discrimination against lesbian, gay, bisexual, and transgender (LGBT) individuals (homosexual acts are illegal); and discrimination against those with disabilities. Issues remain with regards to gender equality and ensuring media independence

Please find references to Sierra Leone in our Human Rights and Democracy Report 2018(published 5 June 2019).

More information on political risk, including political demonstrations and security risks is available in FCO Travel Advice.

4. Economic

The economy remains relatively small ($3.82bn in 2018) and heavily dependent on donor aid. Agriculture provides the backbone to the domestic economy with exports dominated by extractives. Potential offshore oil presents a longer-term commercial opportunity for Sierra Leone, if managed correctly. The IMF estimate growth in 2018 as 3.5%. The local currency (the Leone) depreciated by about 12% against the dollar in 2018.

Sierra Leone is permanently on the GMT time zone, and an Anglophone and extremely anglophile country. The small British Chamber of Commerce in Sierra Leone may be able to provide a forum to discuss and understand how UK businesses in Sierra Leone manage the challenges of doing business here.

Sierra Leone has significant natural wealth, boasting Africa’s largest natural harbour, considerable mineral deposits, and significant renewable energy potential. The majority of the land is arable and benefits from plentiful rainfall and sunlight. The country’s 400km of coastline is home to vast fishing resources, including many premium species, although overfishing is a major challenge.

Sierra Leone was ranked 163rd out of 190 economies in the World Bank Doing Business 2019 survey (PDF, 17,324KB)(economies are ranked on their ease of doing business, a high ease of doing business ranking means the regulatory environment is more conducive to the starting and operation of a local firm). This places Sierra Leone below Guinea (153), Ghana (120) and Senegal (140) but above Guinea-Bissau (176) and Liberia (172) in the region. Sierra Leone ranks 130th out of 137 in the latest World Economic Forum’s Global Competitiveness Report 2017-18.

More information on the investment opportunities available can be found in Sierra Leone: an Investor Guide (published by Herbert Smith Freehills in 2015, updated in March 2017).

5. Bribery and Corruption

Bribery is illegal. Under the UK Bribery Act 2010 it is an offence for British nationals or someone who is ordinarily resident in the UK, a body incorporated in the UK or a Scottish partnership, to bribe anywhere in the world. In addition, a commercial organisation with a business in the UK can be liable for the conduct of a person who is neither a UK national or resident in the UK or a body incorporated or formed in the UK. In this case it does not matter whether the acts or omissions which form part of the offence take place in the UK or elsewhere.

In 2018, Sierra Leone was ranked 129 out of 180 countries and territories in the Transparency International’s corruption perception index (CPI).

Corruption is common in Sierra Leone and appears in many forms and at most levels of society. Business deals can be vulnerable to corruption at the highest levels and poorly paid public servants exacerbate the problem. Businesses also face challenges from the tradition of patronage - counterproductive to fair and transparent business dealings. Claims of corruption against the business community and government have been brought by local and international press as well as international businesses.

Following the 2008 Anti-Corruption Act, Sierra Leone’s Anti-Corruption Commission has some powers – including the power to prosecute. Since then, there have been a number of successful convictions (although rarely of senior figures, and some of the sentences have been subsequently overturned). However the courts have relatively weak capacity, although a Fast Track Commercial Court now operates aiming to make commercial disputes easier and faster to resolve.

Visit the Business Anti-Corruption portal which provides advice and guidance about corruption in overseas markets.

Read the information provided on our Bribery and Corruption page.

6. Terrorism threat

Please read the information provided on the terrorism page of the FCO Travel Advice.

7. Protective Security Advice

Please visit our travel advice.

8. Intellectual Property

As in many developing countries, law and regulation around intellectual property rights are very weak in Sierra Leone, with little done to enforce them. Small-scale traders selling counterfeit DVDs and CDs are the norm around Freetown and other cities. Read the information provided on our Intellectual Property page.

9. Cyber Security

Technology in Sierra Leone is in its infancy; hence, there is low risk of crimes relating to cyber security. As the communication sector matures so will the potential for crime.

10. Organised Crime

Despite progress made by the Kimberley Process concerns over illicit activity in the diamond industry remain.

Read the information provided on our Organised crime page.

11. Precious Stones

Sierra Leone has signed up to the Kimberley Process Certification Scheme (KPCS), which imposes extensive requirements on the shipment of rough diamonds aimed at preventing conflict diamonds from entering the legitimate trade. Participants can only legally trade with other participants who have also met the minimum requirements of the scheme, and international shipments of rough diamonds must be accompanied by a KP certificate guaranteeing that they are conflict-free. Any deals that appear too good to be true probably are.

For more details visit the Kimberley Process website.