Proud Legacy - Sierra Leone Peoples Party

When I read the article, "John Benjamin Blasts Ernest- say the truth about the economy" in Awareness Times’ 27 November edition, I was happy and proud that someone is telling Mr. President the truth. In the 28 November edition, I read another article titled both "Ernest and IMF are Right". The article referred to an, interview with Momoh Conteh, one of my many APC friends. I read the article immediately after leaving Momoh Conteh’s office.

I noticed the responses were inadequate in content and done by someone who has not participated in economic management dialogue in Sierra Leone. I wanted to stay out but on second thought, I decided to participate for two reasons. As an Economist who has monitored the economic developments in Sierra Leone for over 15 years, I thought I should set the records straight. Also, I had to come in so that Mr. President, first gentleman of Sierra Leone does not mislead the public. With him (Mr. President), when he talks, all his cronies and supporters believe and start to re-echo his message. I therefore decided to come in so that Mr. President wrong message does not keep going. I wanted to come in as a Development Economist but I am also the National Secretary-General of the SLPP. I will wear my two hats and come in as both a Politician and an Economist.

Of course, President Koroma spoke like a Politician. I can forgive him. But let me just say Mr. President, when next you talk to IMF officials, know they deal with macroeconomic issues including stabilisation and structural reforms and economic growth is a principal variable for them. For IMF like all economic institutions, economic growth is a necessary condition for poverty reduction and improving living standards. When you talk with the World Bank, you can discuss structural reforms and sector issues such as social protection, health and education issues. Even with them, growth is fundamental as you only distribute what you produce (Gross Domestic Product) or receive as donations.

For students of economics and young economists, let me inform you that the arguments have been about economic growth and distribution. The APC is saying the growth was meaningless as it was not distributed. The SLPP is saying, No, there was growth and efforts were made to distribute the proceeds from growth through policies like more grants-in-aid, free tuition, girl child education, free examination fees, school bus services, subsidized tractor services, free drugs for vulnerable groups (disabled, lactating and pregnant women) post-war resettlement assistance. Undoubtedly, distribution is more difficult as it involves institutional reforms including new laws and procedures as well as infrastructure and logistic challenges.

Let me start with the macro-economy and latter the distribution of gains of economic growth. I, however, beg my readers to take them through memory lane and develop a basis for my arguments. The period of APC rule was characterized by the following:

Acute shortage of foreign exchange and thus scarcity of essential goods like rice and petroleum products.
Large parallel markets for food items, fuel products, national currency the Leone and foreign exchange.
Inflation reached three digits climbing from 76.6% in 1985 to 178.7% in 1987. Economy was on a steady decline with outputs from agriculture and industry plummeting to their lowest levels.
Frequent shut down of businesses. Few examples include the closure of Marampa mines, Bata, PZ, UAC, Railway, NDMC and later SLPMB.

Unemployment and poverty were the consequences of the gloomy era. These coupled with the shrink in public sector, left thousands of people out of jobs with many migrating to urban towns where they eke out living through resorts to informal petty trading activities.

The situation worsened during the war period caused by this very APC Party. Thousands of people were forced to flee their homes and displaced. Social and economic infrastructure destroyed. Economic activities came to a halt as farmers abandoned farm lands leaving behind farm implements and essential inputs. Business firms including mining installations and factories shut down. New investments in the productive sector slowed down with few exceptions in construction and informal commercial sectors. All these heightened the dismal job problem.

During the SLPP era, there were unprecedented levels of economic growths rising from -17% in 1998 to over 7% in 2006. In absolute terms, GDP rose from merely $700 million to about $1.1 billion for the same time period. Yet, this national cake was not enough for the now nearly 5 million people to share. Also, remarkable in the records were gains in institutional changes and structural reforms that impeded economic growths. Some of these are improvement in Budget Formulation and Management – the process became more participatory and transparent. Public Procurement and Government Budgeting and Accountability Acts were enacted. Social Security which is also a distribution mechanism was set up thus removing the long queues for retirement and pension benefits in front of the Treasury. The political will was there to liberalise the markets of goods including petroleum products. Black markets reduced as there was enough foreign exchange in the economy, enough rice and enough petroleum products. The characteristic of the APC regime toe-line disappeared.

As a result of the SLPP effective economic management, Sierra Leone benefited from substantial debt relief under the Heavily Indebted Poor Country (HIPC) Initiative and Multi-lateral Debt Relief Initiatives (MDRI).Today, Sierra Leone external debt stock is about US$0.5 billion compared to US$ 1.7 billion in 2004. The relief expanded the government fiscal space and by September, 2007, a total cash balance of Le 542 billion was left at the central bank for utilization by the APC government and there was external reserve of US$184million; equivalent to 3-4 months of imports. In addition, the commercial banks have reasonable foreign exchange. The Leone has been stable around Le 2,800 - Le 3,100 to I US$ for over 4 years now. Inflation has been under control estimated slightly above 10% in September 2007.

For Mr. President to say there is nothing to write home about the economy is most unfortunate. Indeed, Mr. President missed the point. The APC should be honest to admit the goodies the SLPP left behind.

We are quietly waiting for the budget speech. The APC has no option but to talk about the good economic performance in 2007 otherwise donors will back out.
On ending the war in 2002, the Government was morally right and economically justified to allocate scare resources for resettlement, disarmament, demobilization, reintegration, rehabilitation and reconstruction activities as well as restoration of basic social infrastructure like schools and health facilities. Free tuition, examination fees and girl child school support, institutional feeding, provision of learning and teaching materials, health care assistance for displaced and vulnerable persons in rural communities were all part of the distribution package of the SLPP administration. Obviously, this was at the expense of essential urban facilities. The impacts of these policy choices were, however, great. For example, school enrolment at primary school level rose from about 300,000 in 1998 to over 1.3 million in 2006. Over 900 Peripheral Health Units are functioning compared to less than 500 during pre-war years. Thousands of people who were locally displaced and fled as refugees in neighbouring countries and relied on NGOs for hand-outs returned home and started economic activities. With subsided tractor services and other farming assistance, one can notice resumption of agriculture activities as one travels around the country even in APC strongholds of Bombalil, Port Loko amidst transportation difficulties. The fact is that the over 1 million people that have returned are better off than their ugly days in displaced camps. In essence, it is incorrect and dishonest that people were made worse off during the SLPP era. On the contrary, livelihoods of most people have improved compared to the 90s days.

Admittedly, there are visible signs of youth unemployment and poverty in urban communities. This definitely was a direct consequence of the war. Most of these youths dropped from high schools during the war period. The rural youths moved in search of greener pastures and swelled the army of unemployed urban youths. With little or no employable skills coupled with low investments, several of these youths had to peddle their living through dollar sales, money changing, petty trading, stone breaking, car washing, security jobs and other low paid jobs. The SLPP government started the Youth Employment Scheme and negotiated for a youth component to be included in the Peace Building Fund. Government also provided tractor services to youth groups for farming activities. The resumption of mining activities and construction activities also created jobs for thousands of youths. Agreeably, this was the situation which the SLPP faced after the war. The APC and other parties capitalized on it and fooled our people with the bogus concept of change.

Now APC is here. The prices of essential goods have gone up. Rice which was Le 72,000 per bag in the last days of the SLPP has risen to about Le 100,000. Poda Poda price from Kissy to central Freetown is now Le1, 000 compared to Le 800 few months ago. No jobs yet for the youths despite rhetoric by Mr. President and ministers. Armed robbery is on the increase. We have returned to the reign of indiscipline as APC pursues its ‘massification’ policy (pro-people and want to hurt no one).

To the APC, purging competent guys, mostly from the South & East and perceived to be SLPP and replacing them with less qualified people is the best way out.
For the APC, spending US$32 million to 15 megawatt generator using diesel fuel is preferred to spending less than that amount to complete Bumbuna with capacity to generate 50 megawatt and address the distribution and institutional problems.

Good luck, Mr. President. But you are missing the point.

SLPP

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