VZCZCXYZ0032
RR RUEHWEB

DE RUEHFN #0586/01 2691740
ZNR UUUUU ZZH
R 261740Z SEP 07
FM AMEMBASSY FREETOWN
TO SECSTATE WASHDC 1404

UNCLAS FREETOWN 000586 
 
SIPDIS 
 
SIPDIS 
 
DEPARTMENT FOR AF/W, DRL 
 
E.O. 12958 
TAGS: PGOV KDEM ECON PINR SL
 
SUBJECT: IMPLEMENTING TRADE BILLS PASSED BY OUTGOING PARLIAMENT - A 
CONTINUING PRIORITY? 
 
 
¶1. (U) SUMMARY.  Sierra Leone's last parliament unanimously passed 
three trade promotion bills before the expiration of its term ending 
June 25, 2007.  These bills include the Sierra Leone Investment and 
Export Promotion Agency Act, the Registration of Business Act, and 
the General Law (Business Start-Up) Amendment Act.  All are intended 
to promote export and encourage investment. According to recently 
released World Bank figures, Sierra Leone ranks 160 among 178 rated 
countries for ease of doing business.  The local business community 
generally welcomed these bills, but expressed that much more needs 
to be done to ensure increased investment and economic growth. The 
recent transfer of government authority to All People's Party 
(APC)'s Ernest Koroma, who ran a successful insurance business prior 
to his government service, should bode well for the implementation 
of these bills as well as the for the economic growth of Sierra 
Leone.  END SUMMARY. 
 
PARLIAMENT CREATES NEW TRADE AND INVESTMENT AGENCY 
 
¶2. (U) The outgoing Parliament passed the Sierra Leone Investment 
and Export Promotion Agency (SLEIPA) Act on March 29, 2007.  This 
act calls for a new entity, the Sierra Leone Investment and Export 
Promotion Agency (SLEIPA), to replace the Sierra Leone Export 
Development and Investment Company (SLEDIC), which was charged with 
promoting exports.  Parliament believed that SLEDIC had overly 
focused on export promotion to the detriment of encouraging foreign 
investment. The new act mandates that SLEIPA focus its goals equally 
between investment and export promotion. 
 
¶3. (U) SLEIPA's primary objectives in export promotion will be to 
encourage the development of agricultural production and exports, to 
raise local awareness of the importance of exporting, and to advise 
vendors interested in expanding into foreign markets.  To encourage 
investment in Sierra Leone, the agency will work to identify and 
educate potential investors as well as to advertise investment 
opportunities in Sierra Leone. 
 
REGISTRATION OF BUSINESS ACT PASSED 
 
¶4. (U) The Registration of Business Act was passed on June 8, 2007 
to strengthen the registration of businesses and safeguard business 
proprietary names.  It provides for tighter restrictions on 
registering business names to ensure more protection for business 
owners.  The act also decreases the number of steps necessary to 
obtain a registration certificate, thus reducing the time required 
to start a business.  The number of days to start a business in 
Sierra Leone is currently 26 days and the act should reduce this 
period even further. 
 
BUSINESS START-UP LAW REMOVES OBSTACLES 
 
¶5. (U) The General Law (Business Start-up) Act was passed by 
Parliament on June 6, 2007.  This act is aimed at removing barriers 
to the expeditious establishment, growth, and development of 
businesses in Sierra`$QRk?/ueases the duration of work and resident permits 
to enable foreigners to more easily establish and maintain 
businesses in Sierra Leone. 
 
ACTS GARNER UNANIMOUS PARLIAMENTARY SUPPORT 
 
¶6. (SBU) The legislation enjoyed the support of all political 
parties represented in Parliament who unanimously passed all three 
trade bills.  The bills were introduced to Parliament by the 
Minister of Trade and Industry, Dr. Kadi Sesay, who piloted them 
through the legislative process.  To ensure completion of passage of 
the legislation prior to the termination of the last session of 
Parliament, President Kabbah used his constitutional prerogative to 
issue a certificate of urgency, which mandates that named 
legislation be immediately put to a vote. 
 
FUTURE OF BILLS IN LIMBO DUE TO RECENT ELECTIONS 
 
¶7. (SBU) While the legislation has been passed, little has been done 
to implement these laws as Sierra Leone has just completed national 
elections.  Most government officials - elected and career - have 
spent their work days campaigning for their political party rather 
than conducting the business of government.  The new Parliament, now 
made up of a majority of the former opposition APC party, will not 
open officially until early October 2007.  The APC opposition 
candidate Ernest Bai Koroma, a successful businessman, won the 
presidency and was sworn into office on September 17. However, he 
has yet to name his cabinet and key ministers and is relying on a 
temporary transition team at this time.  It will fall to this new 
government - when established - to implement these trade bills and 
explore more ways to ensure a more positive business and trade 
environment. 
 
¶8. (U) The implementation of these bills and introduction of other 
 
improvements is essential as the current environment is not 
adequately conducive to the conduct of business.  According to 
recently released World Bank indicators, Sierra Leone ranks low for 
the ease of doing business at 160 out of the 178 rated countries. 
Among African countries, it ranks 31 out of 46. 
 
COMMENT 
 
¶9.  (SBU) COMMENT: The Sierra Leonean business community welcomes 
the enactment of the new trade legislation. However, many believe 
that the GoSL must do considerably more if the business environment 
is to open up and promote true economic growth.  For example, 
restoring key infrastructure, such as a reliable energy supply, will 
be critical to making Sierra Leone an attractive business 
opportunity.  In particular, the business community looks forward to 
a reduction of the high duties placed on imports by the National 
Revenue Authority (NRA), which they consider to be the most critical 
barrier to investment in Sierra Leone.  They believe that lowering 
import duties will have a multiplying effect by encouraging 
additional business investment, promoting employment, lowering the 
costs of consumer goods and services, and reducing the high cost of 
living.  However, considering revenues generated from import duties 
are the third largest source of income for the government, it seems 
highly unlikely that the new government would significantly reduce 
these duties anytime soon. 
 
¶10. (SBU) COMMENT CONT'D: Before joining Parliament and taking on 
the Presidency, President Koroma was a successful businessman in the 
insurance sector.  Considering this, we expect that he will actively 
address the concerns of the business community and, therefore, push 
the implementation of these bills forward once his government is in 
place.  Beyond this legislation, many speculate that his business 
background will lead him to encourage even more significant 
improvements in the business environment that will expand investment 
opportunities and reduce the burdens of running a business in Sierra 
Leone, which would be a positive improvement for Sierra Leone and a 
necessary contribution to the country's development.  END COMMENT. 
 
PRATT