By Sallieu S. Kanu
Washington, DC – November 26, 2025: The International Monetary Fund (IMF) announced that it has reached a staff-level agreement with Sierra Leone on the first and second reviews of the country’s economic program under the Extended Credit Facility (ECF). The agreement, subject to approval by IMF Management and the Executive Board, could unlock approximately US$78.8 million in financing.
The IMF mission, led by Christian Saborowski, visited Sierra Leone from October 3–10, 2025, to assess progress under the program approved in October 2024. The first review had been delayed due to spending overruns, reserve depletion, and delays in structural reforms. However, recent improvements in fiscal discipline and monetary policy have set the stage for renewed support.
Key Findings
- Fiscal Policy:
- Spending overruns in 2024, largely on road construction, tightened fiscal space less than expected.
- Authorities now aim for a domestic primary surplus of 0.6% of GDP in 2025, marking a 3.3 percentage point consolidation compared to 2024.
- Social spending commitments remain unmet, raising concerns about inclusive growth.
- Monetary Policy:
- Inflation fell to 4.4% in October 2025, allowing the Bank of Sierra Leone (BSL) to reduce its policy rate by six percentage points to 18.75%.
- Treasury bill rates dropped sharply from over 40% to around 17%.
- Despite progress, BSL reserves have declined to just 1.5 months of import coverage, a major vulnerability.
- Economic Outlook:
- Growth is projected at 4.4% in 2025, rising to 4.6% in the medium term.
- Inflation is expected to remain in single digits.
- Risks include reform fatigue, slower global growth, tighter financial conditions, and geopolitical uncertainty.
Reform Priorities
The IMF and Sierra Leonean authorities agreed on measures to strengthen fiscal sustainability and rebuild reserves:
- Revenue Mobilization: New tax policy measures worth 1.5% of GDP, alongside stronger compliance and administration.
- Expenditure Restraint: Continued efforts to reduce reliance on domestic financing while protecting social spending.
- Structural Reforms: Improvements in public financial management, debt management, and banking sector oversight.
- Governance: Implementation of recommendations from the Governance and Corruption Diagnostic.
- Reserves: Efforts to purchase foreign exchange, cut government import spending, and reduce energy subsidies.
Next Steps
The IMF Executive Board will consider the reviews in the coming weeks. If approved, Sierra Leone will gain access to fresh financing to support its economic program and stabilize reserves.
The IMF team expressed appreciation for the constructive engagement with Sierra Leone’s leadership, including Finance Minister Bangura, BSL Governor Stevens, and other stakeholders from civil society, the private sector, and development partners.