Economy of Sierra Leone

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The economy of Sierra Leone is that of a least developed country[1] with a GDP of approximately 1,9 billion USD in 2009.[2] Since the end of the civil war in 2002 the economy is gradually recovering with a GDP growth rate between 4 and 7%.[2] In 2008 it's GDP in PPP ranked between 147th (World Bank) and 153th (CIA) largest in the world.[3] Sierra Leone's economic development has always been hampered by an overdependence on mineral exploitation. Successive governments and the population as a whole have always believed that "diamonds and gold" are sufficient generators of foreign currency earnings and lure for investment. As result large scale agriculture of commodity products, industrial development and sustainable investments have been neglected by governments. The economy could thus be described as one which is "exploitative" and based on the extraction of unsustainable resources or non-reusable assets. Sierra Leone is a member of the WTO.

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Macro-economic trend

This is a chart of trend of gross domestic product of Sierra Leone at market prices estimated by the International Monetary Fund and EconStats [4] with figures in millions of Sierra Leone Leones.

Current GDP per capita of Sierra Leone grew 32% in the Sixties reaching a peak growth of 107% in the Seventies. But this proved unsustainable and it consequently shrank by 52% in the Eighties and a further 10% in the Nineties.

Rich in minerals, Sierra Leone has relied on the mining sector in general, and diamonds in particular, for its economic base. In the 1970s and early 1980s, economic growth rate slowed because of a decline in the mining sector. Financially disadvantageous exchange rates and government budget deficits led to sizable balance-of-payments deficits and inflation. Certain policy responses to external factors as well as implementations of aid projects and maintenance have led to a general decline in economic activity and a serious degradation of economic infrastructures. Sierra Leone's short-term prospects depend upon continued adherence to International Monetary Fund programs and continued external assistance.

Although two-thirds of the population engages in subsistence agriculture, and despite the fact that most Sierra Leoneans derive their livelihood from it, agriculture accounts for only 42% of national income. As of 2003, the government was trying to increase food and cash crop production and upgrade small farmer skills. Also, the government works with several foreign donors to operate integrated rural development and agricultural projects.

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