Geneva, 14 December 2010 - Since the end of civil war in 2002, Sierra Leone has achieved political stability and embarked upon a comprehensive reform programme to re-establish conditions for economic and social development, notably through increased levels of foreign direct investment (FDI), national officials and investment experts said today at a meeting unveiling UNCTAD´s Investment Policy Review (IPR) of Sierra Leone.
The IPR - the 30th carried out by UNCTAD at the request of developing and transition countries - recommends steps to address deficiencies in infrastructure, to improve education and job training, to establish an effective fiscal regime, and to spur business and trade as ways of increasing incoming foreign investment. And it calls for well-designed government policies to create employment and improve living conditions, with the support of the international community, to create firm grounds for peace.
The review was presented today at a forum in Geneva during which government representatives, development partners, and the private sector of Sierra Leone debated the legal and strategic recommendations proposed by UNCTAD in its report.
UNCTAD Secretary-General Supachai Panitchpakdi highlighted the importance of the ongoing reform process and praised the country for its open and favourable FDI regulatory regime. "I hope the IPR will contribute to strengthening the country´s investment framework and policies, attract high-quality FDI, and continue to move the country forward on the path toward sustainable development," he said.
Samura Kamara, Minister of Finance and Economic Development of Sierra Leone, said the Government is firmly committed to creating the conditions that will enable the private sector to flourish and become the main driver of job creation and sustainable development in the country. He highlighted a number of key reforms adopted recently, including a new public-private partnership law to foster private investment in infrastructure, and various major projects. He also stressed, however, that much of the investor community lags 10 years behind in its perception of Sierra Leone´s reality. He said he hopes the IPR will contribute to correcting the country´s image.
UNCTAD encouraged Sierra Leone to promote and attract FDI more effectively, notably by streamlining FDI regulations, by strengthening "aftercare," in which foreign investments are well-monitored and managed, and by creating a favourable image of the country among potential investors. The report also recommends strengthening the international investment framework through an enlarged network of bilateral investment treaties and double taxation treaties, which will integrate key elements of a strategy to stimulate investment.
"The consequences of the war have impacted the image of Sierra Leone vis-à-vis foreign investors, leaving a gap between reality and perceptions of the country," said James Zhan, Director of UNCTAD´s Investment and Enterprise Division. He also called for targeting investment towards sectors such as mining, commercial agriculture, fisheries, and tourism.
Ahmed Ahmed, Chief Director of the Sierra Leone Ministry of Trade and Industry, endorsed the recommendations of the IPR and presented the objectives of the government with respect to foreign investment. He said numerous reforms have been carried out over the past few years relating to the tax regime, the national "companies law," and port privatization. He said efforts have been made to tackle corruption and to ensure macroeconomic stability. He said the challenges that remain include infrastructure and human capital development, and stated that legal reforms will soon be adopted for special economic zones, for enhancing competition, and for protecting consumers. He also indicated that further technical assistance from UNCTAD to implement reforms has just been approved.
Development partners and senior representatives of the private sector commented on the IPR and said the country is on the right path for attracting more private investment, but must continue its reform process.
UNCTAD undertakes Investment Policy Reviews of developing and transition countries at the request of their governments. The in-depth studies evaluate investment regimes and advise governments on how to maximize the development impact of FDI. A follow-up review is generally performed five years after an IPR is issued to see if the recommendations have been implemented and to determine the effects of altered government policies on FDI flows.
