Sierra Leone’s Finance Minister, Ahmad Fantamadi Bangura, has presented the government’s budget and financial policies for the financial year 2024, projecting resilient growth but also highlighting several factors that could derail the budget’s implementation and hinder the achievement of its objectives.

In his presentation to the Chamber of Parliament, Bangura outlined the following potential risks to the 2024 budget:

Continued Geopolitical Tensions: The ongoing Russia-Ukraine war and the Palestine-Israel conflict could exacerbate global economic uncertainties and disrupt trade flows, negatively impacting Sierra Leone’s economy.

Rising Global Food and Energy Prices: The persistent increase in global food and energy prices could translate into higher domestic prices, putting upward pressure on inflation and eroding household purchasing power.

Exchange Rate Depreciation: A continued depreciation of the exchange rate could increase the cost of imported goods and services, further fueling inflation and straining the budget.

Weak Global Economic Recovery: A sluggish global economic recovery could lead to reduced overseas development assistance and foreign direct investment inflows, limiting Sierra Leone’s access to critical financing sources.

Revenue Shortfalls: Delays or partial implementation of the Medium-Term Revenue Strategy could result in revenue shortfalls, hampering the government’s ability to fund its development priorities.

Non-Compliance by Ministries, Departments, and Agencies (MDAs): MDAs’ failure to adhere to budget limits and persistent requests for extra-budgetary expenditures, including salary increases, could strain the budget and divert resources from essential programs.

Weak Financial Performance of State-Owned Enterprises (SoEs): The poor financial performance and contingent liabilities of SoEs pose significant risks to the budget, potentially requiring government bailouts that could strain public finances.

Despite these challenges, Bangura expressed optimism about Sierra Leone’s economic prospects, emphasizing the government’s commitment to implementing prudent fiscal policies, fostering a conducive environment for private sector growth, and strengthening social protection programs to mitigate the impact of external shocks.