Conflict is a major cause of political instability and poor institutional quality, leading to low foreign direct investment (FDI) in Sierra Leone. The country has suffered various conflicts, including revolutionary warfare, insurgency, and conventional warfare, driven by political power struggles and resource competition.
These conflicts have tarnished Sierra Leone’s international reputation, branding it as a nation plagued by political instability, civil war, and blood diamonds. This negative image hampers FDI and economic development. According to the 2023-24 Human Development Index (HDI) from the United Nations Development Program (UNDP), Sierra Leone ranks 184th out of 193 countries, with a score of 0.458, down from 0.477 in 2021.
The HDI measures human development based on life expectancy, education, and standard of living. Researcher Eric Johnson from Stanford University noted the severe social and economic costs of Sierra Leone’s civil war, highlighting atrocities such as murder, rape, and mutilation. The war from 1991 to 1999 claimed over 75,000 lives, displaced half of the population, and turned 500,000 Sierra Leoneans into refugees. The economy lost millions in illegal diamond trading during this period.
These memories remain fresh, raising concerns about business safety following the recent coup attempt on November 26 and the forthcoming deployment of an ECOWAS Stabilization Force. Immediate action is needed to end these sources of death and destruction, whether through tripartite negotiations or the ECOWAS deployment.
Colonel Issa Bangura, Director of Defense Public Relations and Information, stated in an AYV Media interview that the ECOWAS force will reinforce Sierra Leone’s security amid recent unrest. This move, following a decision at the 64th ECOWAS Ordinary Session in Abuja, Nigeria, aims to prevent unconstitutional power grabs. The ECOWAS delegation, led by President Dr. Omar Alieu Turay, discussed the deployment with the Bio administration, marking a significant step toward enhancing security.
During President Bio’s state visit to China from February 27 to March 2, he sought to attract investments by meeting with Chinese companies. He assured investors of a conducive environment, citing successful examples like Leone Rock Company. However, financial planner Brian Perry emphasized that investors assess economic, political, and business risks. Stability in Sierra Leone is crucial to reducing political risk and attracting FDI.
Additionally, Sierra Leone faces declining diaspora remittances, which impact FDI. Despite an initial increase from $113.94 million in Q3 2022 to $142.69 million in Q2 2023, remittances fell to $111.8 million in Q4, an 11.9% decrease. The Central Bank projects a potential rebound, but this depends on the country’s stability.
If Sierra Leone can overcome greed, tribalism, nepotism, and regionalism, and embrace peace, it can transform its international image. Leveraging the diaspora’s social, political, professional, and intellectual capital can enhance institutional capacity, attract FDI, and promote inclusive and sustainable development.
