Sierra Leone offers opportunities for U.S. firms across various sectors, but the market presents significant challenges. Macroeconomic instability, characterized by high inflation, debt-driven government spending, loose fiscal and monetary policies, a depreciating currency, and rising living costs, remain challenges in the business environment. Capital market opportunities are limited, with the Sierra Leone Stock Exchange remaining largely inactive despite over a decade of operation.
The labor force is predominantly informal, with 90% of workers engaged in subsistence farming or small-scale agriculture. A shortage of skilled professionals, due to insufficient vocational training, poses recruitment and training challenges for foreign investors. Infrastructure deficits, including unreliable electricity and energy access, further hinder investment, domestic travel, and routine operations.
Corruption is pervasive, particularly in government procurement, licensing, regulatory enforcement, customs clearance, and dispute resolution. While the Anti-Corruption Act of 2008 criminalizes bribery and empowers the Anti-Corruption Commission (ACC) to block contracts against national interests, corruption remains a major issue. Sierra Leone ranked 114th out of 180 countries on the 2024 Transparency International Corruption Index, scoring 33 out of 100. Although the country ratified the UN Convention against Corruption in 2004, it is not a party to the OECD Anti-Bribery Convention.
Customs clearance processes remain slow and bureaucratic, despite automation and the expansion of Freetown’s major seaport. Engaging a clearing agent can help expedite the process. Accessing land is challenging, particularly outside the capital, where traditional leaders play a central role in land tenure. The country operates two land tenure systems: a freehold system in the Western Area, including Freetown, and a leasehold system in the provinces, governed by local communities and land committees under the Customary Land Rights Act of 2022.
Sierra Leone’s legal system allows for the enforcement of property and contract rights, with foreign investors having equal access, but it is slow and often influenced by financial and political factors. Property management procedures are lengthy, costly, and unreliable. While Sierra Leone imposes minimal restrictions on foreign company ownership, regulatory frameworks can be complex and opaque, complicating compliance with local laws. Export licenses are required for certain goods, and gold and diamond exports must adhere to Kimberley Process certification standards. The Petroleum Act, amended in 2014, restricts petroleum exploration and production licenses to companies registered or incorporated in Sierra Leone. Although U.S. interests face no discriminatory treatment, these challenges, combined with the fragile rule of law and limited intellectual property protections, affect all foreign firms operating in the country.