Over $130M economic stimulus to mitigate COVID-19 effects By Ibrahim Tarawallie
The government of Sierra Leone has through the Ministry of Finance put together an ambitious package to help mitigate the impact of COVID-19 pandemic on the economy, businesses and livelihoods of Sierra Leoneans.
The COVID-19 Quick Action Economic Response Programme (QAERP) aim to maintain macro-economic and financial stability and mitigates the impact of the pandemic shock on businesses and households.
According to the country’s Chief Economist, Alimamy Bangura, the rationale behind the QAERP is to build and maintaining an adequate stock level of essential commodities at stable prices, providing support to hardest-hit businesses to enable them to continue operations and avert lay-offs of employees, expand safety nets to venerable groups, Supporting labour-based public works and providing assistance for the local production and processing of stable food items.
He told a presser on Monday May 18, 2020 that the total cost of the programme would be around one hundred and Thirty-six million United State Dollars ($136M), excluding revenue lost.
He said several countries have designed economic stimulus/response packages to alleviate the impact of the outbreak on their economies based on estimated impact.
Mr. Bangura noted that the central bank has cut interest rates, lowered reserved requirement for commercial banks and cost of mobile money transfer.
“GDP growth has been revised downwards from a predicated 4.2 percent to 3.1 percent. Domestic revenue is expected to fall by 15 percent and expenditures expected to increase by an additional Le. 1Trillion,” he stated.
The Minister of Finance Mr Jacob Jusu Saffa said the economic management is on a positive trajectory and that if Sierra Leone has not been on course, the economy should have collapsed. He disclosed that the most recent International Monetary Fund (IMF) review process came out very positive with the country passing all of the indicators.
“I will proudly tell you that we are going to access substantial grant resources; though it cannot be substantial to take care of everybody. I am of the opinion that Sierra Leone will surpass the IMF projected growth rate,” he said.
He said the government has done quite a lot to boost the agricultural sector in order not to miss out on the planting season.
“The Quick Action Economic Response Programme (QAERP) is a ‘bread and butter’ component. Take for instance the NaCSA safety nets. When we have a lockdown the less privileged especially the disabled benefitted and we are trying to scale up that,” he assured.
Governor of the Bank of Sierra Leone, Professor Kaifala Kallon said the Bank will provide 500 billion Leones support to the private sector for the importation of essential commodities.
“We will provide a special loan facility at concessional interest rates to support the production, importation and distribution of essential goods and services. We will also establish and maintain stock and price monitoring system for essential commodities,” he said.
On mining, the Bank Governor said stated that they have negotiated with Koidu Holdings to buy their diamond stock so as to enable the company to keep staff and pay salaries.
Also speaking, Commissioner of the National Commission for Social Action (NaCSA), AbuBockarie Kokofele noted that has been providing safety nets to vulnerable groups in the form of cash transfers and dry ration.
He said the quick action economic response programme is also supporting and providing assistance for local processing of stable food items.
Earlier, Deputy Finance Minister II, Sheku Bangura noted that trade and tourism are one of the sectors that have received one of first hit of the crisis because of the decisions and policies that have been past globally to restrict movements of people.
“Our supply chain has been disrupted and the import of intermediate goods is having some hit also. More generally, the crisis will affect our taxes which provide the resources that we will require to run the country,” he said.
He noted that the way decisions have been taken from the leadership have been very decisive, in that it has ensured the protection and assurance of livelihoods