The Sierra Leone Government has devised a new project to cushion the effect of the US Dollar against the local currency, Leone.
On July 5, the Ministry of Finance said that all new projects special accounts to be opened at the Bank of Sierra Leone.
The Finance Ministry said the move is “a new policy of the Government” that should be acted upon with “immediate effect”.
“The Bank of Sierra Leone will provide banking services for both the foreign currency and the Leone accounts,” the Minsitry said.
The letter was principally addressed to Permanent Secretaries in Government Ministries including Ministry of Basic and Senior Secondary Ministry of Agriculture and Ministry of Health and Sanitation.
The Finance Ministry warned all Project Managers and Coordinators to comply with the new policy.
“Please note that the Accountant General will not process any request to open special account outside the new policy framework,” the letter read.
Experts said that the new policy will lead to the depreciation of the dollar against the local currency.
The Leone has been performing poorly against other foreign currencies for more than a year now. This coupled with inflation has badly affected the Sierra Leonean economy.
In 2022, the Johns Hopkins Hancke’s Currency Watchlist placed the Leone among the top five most depreciated currencies in the world.
But recently, the Leone has been slowly shortening the gap against the US Dollar and other foreign currencies.