Publication: Sierra Leone Country Economic Memorandum: From Potential to Progress: Structural Transformation and Job Creation on the Road to Middle-Income Status
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2025-06-26
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2025-06-26
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Despite its many assets and a promising recovery from the devastating civil war, Sierra Leone remains one of the poorest countries in the world. A rich mineral endowment, a young and increasingly educated population, and plentiful arable land coupled with favorable rainfall are some of the notable factors that lend immense potential to the economy. And while some positive steps have been taken to harvest this potential– including a successful transition from the civil war and the subsequent stability, a policy focus on education and gender inclusion, and designing a relatively robust legal framework–there is still substantial progress to make, as the country falls notably short of its capabilities and lags behind other comparable countries. Sustaining longterm growth and development is likely to become even more challenging due to the rising pressures from climate change. More than a quarter of the population remains in extreme poverty. Most strikingly, Sierra Leone has lost ground compared to other low-income countries–it had the 27th lowest per capita GDP in the world in 2002, it now has the eleventh lowest level. The country is now at a crossroads. The choices made at this critical moment will determine whether the country can break free from its past and achieve sustained high growth and job creation, thereby lifting its people out of poverty and enhancing their living standards, or whether it will remain trapped in a low-level equilibrium, hindered by policies focused on addressing recurrent crises. To achieve the former, ambitious, farsighted, and difficult reforms are urgently needed. These must restore macro-stability as an immediate focus and leverage the country’s strengths and endowments, including its rich natural resource and agricultural base, to make the necessary long-term investments in human, physical and institutional capital to allow business to flourish in the country. Appropriately leveraging its natural resource base by capturing revenues from mining activities and subsequently using these revenues for human and physical capital investments can help set up the foundation for private sector development and diversification to support job creation in the future. With ambitious reforms, the country can aim to achieve middle-income status in a decade. Heightened macro instability, limited gains in productivity, constrained capital accumulation, and slow human capital development are expected to be detrimental to Sierra Leone’s long term growth trajectory, delaying the country’s transition to middle-income until 2037 (under baseline assumptions). An ambitious strategy and steadfast implementation of reforms are necessary to leverage the country’s natural resource base and reap the demographic dividend. To this end, this 2025 Country Economic Memorandum undertakes an analysis of the growth record and provides recommendations to help ignite and sustain higher and more stable growth over the coming decade.
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“World Bank. 2025. Sierra Leone Country Economic Memorandum: From Potential to Progress: Structural Transformation and Job Creation on the Road to Middle-Income Status. © World Bank. http://hdl.handle.net/10986/43382 License: CC BY-NC 3.0 IGO.”
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