The construction of new infrastructure is one of the pillars of the Agenda for Prosperity
Sierra Leone is pushing ahead with a series of big transport and energy projects to improve the African country’s infrastructure, and provide firm foundations for economic growth and development.
Key objectives are boosting power generation and transmission networks, expanding the mining sector, improving port facilities and extending trunk roads.
The government’s market-opening policies have won IMF backing, although some worry about China’s growing dominance, questioning project priorities and argue more should be allocated to health and education in a country where life expectancy is just 51 years.
The reform programme “has achieved its key objectives despite the exogenous shocks of the Ebola epidemic and the collapse of iron-ore prices and associated loss of production in 2014-15,” the IMF said in a September 2016 report, when it released another $33 million in financing.
The IMF also called for faster progress on structural reforms and said that “diversifying growth, making it more inclusive and distributing its benefits more widely should be the overriding focus of economic policy.”
A significant proportion of Sierra Leone households don’t have electricity and it is worse in rural areas where most public buildings, like health clinics and schools, lack connectivity, so there is a lack of lighting for medical care and problems maintaining cold storage for essential medicines.
Unreliable generator-based supplies used in many rural areas cost far more than power in urban areas, which benefit from grid connection and subsidised tariffs. During the Ebola outbreak, a lack of reliable power was a major obstacle to its ability to cope with the crisis.
The government’s long-term plans include a huge increase in Sierra Leone’s installed generating capacity to 1,000 megawatts (MW), energy minister Henry O. Macauley said, partly through a ramping up of hydro and renewable energy and by encouraging private investment, with the objective of stable power links for all by 2025.
Sierra Leone has as much as 12 billion tons of iron-ore reserves, but the “cost of extraction is higher than the average precisely because of the lack of a reliable and affordable source of energy…once we fix that, we will be able to attract new foreign investors and, maybe, they would also install smelting plants locally that will improve the quality of the product before shipment,” Minister Macauley adds.
Its main power source, the 50 MW Bumbuna hydro-electric plant, has been running at some two-thirds of capacity due to technical problems, although, private power company Joule Africa is hoping to complete a 202 MW expansion of capacity by end 2017, with its Bumbuna II project.
Other work underway involves Finnish company Wärtsilä building a 57 MW heavy fuel oil generation plant and the construction of transmissions lines funded by an India Exim Bank $78 million loan.
A May 2016 UK aid deal will install 250,000 solar-power units in households by end-2017. Over the next four years, half a million people are due to benefit from at least 90 mini-grids powered with renewable and hydro energy and operated by local entrepreneurs.
The first of three 2.2 MW mini hydro-electric dams, each able to supply 10,000 households with power, was signed over to the energy ministry in December 2016 by the constructor, China’s Hunan Group.
In 2017, work will start on a West African Power Pool project to link Sierra Leone, Guinea, Liberia and Côte d’Ivoire through 1,525 kilometres of new lines.
One of the biggest infrastructure projects underway now is for more port facilities at the Freetown Queen Elizabeth II Quay by French operator Bolloré Ports, which has run its container facility since 2011. It is funding the $120 million project to build a 270-metre quay extension and a power plant dedicated to the facility.
“The Port of Freetown is one of the gateways of international trade for West Africa and the countries of the hinterland”
Capt Fabjanko Kokan, Country Manager in Sierra Leone for Bolloré
This will allow vessels carrying up to 6,000 containers to berth and increase handling capacity from 90,000 twenty-foot-equivalent containers now to 750,000 at its completion, expected in September 2018.
“The Port of Freetown is one of the gateways of international trade for West Africa and the countries of the hinterland,” says Capt Fabjanko Kokan, Country Manager in Sierra Leone for Bolloré. In the past five years, the company has invested heavily to rehabilitate existing yards and buy modern equipment, allowing port traffic to rise by over 30 per cent.
Sierra Leona sits on some of Africa’s largest iron-ore deposits, whose exploitation is a major component of the country’s GDP, along with exports of diamonds, bauxite and rutile, a titanium oxide ore.
The slump in iron-ore prices and the 2014-15 Ebola outbreak prompted the shutting of the massive Tonkolili mine, but owner Shandong Iron and Steel Group restarted production in February 2016. It recently said it would spend $700 million to expand output and build a plant to process ore which up to now it had been exporting to Qingdao in China in an unprocessed state.
“To some, it looks as if China simply wants to export its domestic pollution abroad. Officials are desperately trying to close dirty domestic steel plants. There is a more favourable interpretation, however: that Chinese firms are taking a longer view of Africa’s potential. African steel demand is expected to hit 300 million tonnes per year by 2050, according to Mysteel.net, a Shanghai-based trade publication,” the prestigious Economist magazine commented.
President Ernest Bai Koroma was in China in December to discuss this and other Chinese financing and investment, including a China Exim Bank-financed international airport to be sited at Mamamah, about 100 kilometres northeast of Freetown.
The President has long been a supporter of the planned airport, for which China earmarked around $315 million in 2011 only to be put off by the worldwide slump in commodity prices and Ebola. The only international airport now is a former British air force base sited a hazardous one hour-estuary crossing away from the capital, or three hours by road.
“Sierra Leone needs this airport for economic growth, job creation and easier access,” China’s ambassador was recently quoted by Sierra Leone media as saying, adding that a start to work is imminent and will take around three years to complete.
The road network is being expanded and upgraded with government money, foreign aid and loans, including a 103-kilometre road financed by the European Union. Other road financing is coming, among others, from The Kuwait Fund for Development, the Islamic Development Bank and the Arab Bank for Economic Development in Africa.