Sierra Leone Telegraph: 5 June 2024:
Representatives from last year’s investment delegation of Development Finance Institutions (DFIs) have returned to Sierra Leone to support private sector lending. Building on the achievements of the 2023 investment delegation, the aim of the week-long visit is to support increased lending to Sierra Leone’s private sector through a partnership between DFIs and other development partners.
This is the next step in a commitment between the Africa Resilience Investment Accelerator (ARIA), a consortium of DFIs supporting investment in frontier markets, and Invest Salone, the UK-funded private sector development initiative, to support the enabling environment for business in Sierra Leone.
To identify lending bottlenecks and the extent of the private sector finance gap, Invest Salone and ARIA – together with their partners, British International Investment, the International Finance Corporation and the Dutch Entrepreneurial Development Bank, FMO – convened a roundtable on Tuesday 4 June 2024 involving bank leaders and DFI representatives.
The roundtable highlighted opportunities for technical assistance, joint initiatives and DFI support, and will build on last year’s discussions with over 30 small and medium-sized enterprises (SMEs) about sector-specific challenges and barriers.
Speakers at the event included the Director of Banking at the Bank of Sierra Leone; Drucilla Coker, Head of SME at Ecobank; Mohamed Sowe, Finance Director at Pee Cee & Sons; and Susan Coker, CEO of Evsumo Aqua.
Access to finance is crucial to develop a thriving private sector in all economies. As the primary source of large loans, banks have a key role to play in promoting economic development through private sector growth.
In Sierra Leone, where bank lending to the private sector is among the lowest in the Sub-Saharan region, businesses regularly identify access to finance as a significant constraint. A range of factors, including limited financial products and high interest rates, compound the problem.
By providing loan facilities to financial institutions for on-lending to the private sector, DFIs are playing an increasingly important role in improving access to finance for the private sector.
Christina Clark-Lowes, Invest Salone’s investment lead, said that creativity and collaboration across the entire financial ecosystem is needed to boost private sector access to finance.
“Sierra Leonean businesses with the potential for growth need financial products that are tailored to their specific needs in terms of repayment and flexibility. ARIA’s collaboration with Invest Salone enables financial institutions to connect with DFIs that have the mandate to invest in frontier markets such as Sierra Leone.
“Not only do they provide access to capital, they also offer access to technical assistance to support financial institutions in their journey to adapt their products, systems, processes and procedures to cater to the private sector. It is the combination of these things that has proven to be most successful in achieving impact,” she said.
Alex Kucharski, Manager at British International Investment and Co-lead for ARIA, said: “There are many high potential businesses here in Sierra Leone. British International Investment is an active investor in the country with a portfolio across a variety of sectors including financial services, energy and forestry. We set up the ARIA initiative to help unlock even more investment. By working closely with Invest Salone, development finance institutions and the private sector, we can help ensure financial products are better tailored to those who need them.”
Following previous ARIA missions to Sierra Leone in March 2022 and November 2024, ARIA will also explore additional investment opportunities in Sierra Leone’s financial, food, agriculture, and manufacturing sectors, and take part in a number of networking events to better understand the country’s business landscape.
About ARIA
The Africa Resilience Investment Accelerator (ARIA) aims to unlock investment in frontier markets across Africa, including Benin, the Democratic Republic of the Congo, Ethiopia, Liberia and Sierra Leone. ARIA helps development finance institutions with investment opportunities, supports companies in becoming investment-ready and partners with key stakeholders to build early-stage investment ecosystems. The initiative is supported by British International Investment and FMO, the Dutch entrepreneurial development bank.
About Invest Salone
Invest Salone is a UK funded programme for private sector development. It boosts investment in agriculture, manufacturing, fisheries, and tourism by strengthening the pipeline of investible firms and projects, supports firms to grow their exports, and helps the private and public sectors to find lasting solutions to investment blockages that hamper business growth. Its overall aim is to increase incomes and jobs for thousands of Sierra Leonean women and men.
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