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INFO RUEHZK/ECOWAS COLLECTIVE

UNCLAS SECTION 01 OF 08 FREETOWN 000024 
 
SIPDIS 
 
STATE FOR EB/IFD/OIA 
 
E.O. 12958: N/A 
TAGS: PGOV EINV ETRD KTDB USTR OPIC SL
SUBJECT: SIERRA LEONE 2009 INVESTMENT CLIMATE STATEMENT 
 
REF: STATE 123907 
 
¶1. Per reftel, please see Embassy Freetown's 2009 Investment 
Climate Statement below. The document will also be sent via 
e-mail on the unclassified system. Embassy POC for this 
report is Political/Economic Officer Amy LeMar 
(lemaran.@state.gov). 
 
¶A. Openness to Foreign Investment 
 
¶2. The Government of Sierra Leone's (GoSL) Ministry of Trade 
and Industry, Administrator General and the Sierra Leone 
Investment and Export Promotion Agency (SLIEPA), are actively 
working to increase trade and foreign investment. 
 
¶3. Investment Laws: In 2007, Parliament amended the 2005 
investment code. This amended act created SLIEPA. It is 
designed to put Sierra Leone on par with western countries 
concerning the protection of companies and encouraging and 
promoting investment and agricultural export. The Ministries 
of Trade and Industry, Finance, and others are working on an 
annex to the code, which will detail the investment 
incentives offered in specific sectors. 
 
¶4. The GoSL is working to build the industrial base to help 
develop the country and create jobs. Sierra Leone is starting 
from a low level. Officials point specifically to the need 
for foreign investment and value-added activity in a number 
of sectors, but they highlight agricultural production and 
processing and fisheries production and processing. 
 
¶5. The sanctity of contracts is upheld in law. In practice, 
the judicial system is slow and inefficient and is widely 
reported to be corrupt. Even when a party receives judgment 
in its favor, such judgments may be unenforceable.  The UK 
Government is undertaking a multi-million dollar judicial 
reform program. 
 
¶6. There are no laws or regulations restricting remittances 
or repatriation of profits. Outflows are largely for physical 
capital expenditures and to make payments abroad for such 
expenses as school fees. Outflows of wealth from Sierra Leone 
are dominated by the export of diamonds and other minerals, 
not financial flows. 
 
¶7. There is no industrial policy that discriminates against 
foreigners nor are there sectors where there are limits or 
prohibitions on foreign investment or the denial of national 
treatment. Sierra Leonean authorities do not screen 
investments. 
 
¶8. Late in 2005, the parliament passed an Anti-Money 
Laundering Law aimed at regularizing and controlling capital 
inflows so as to help protect against efforts to destabilize 
the country or to meddle in politics or political party 
affairs. In putting the law into effect, the GoSL underscored 
its desire for ethical investment. The law allows the 
importation of $10,000 in cash. Amounts beyond that must be 
transferred through the banking system to insure transparency 
and to make sure that there is a paper trail. Several 
foreigners were stopped at the Freetown airport in 2008 with 
large amounts of cash. The police temporarily confiscated the 
money and deposited it in the Bank of Sierra Leone pending 
investigations. The banking sector and other financial 
institutions are working to address some inadequacies in the 
law, and an amendment is expected to go before Parliament in 
¶2009. The West Africa Bankers Association (WABA) actively 
encouraged establishing a credit card-friendly environment in 
Sierra Leone during their annual seminar. 
 
¶9. Acquiring Land: There are two types of land tenure 
inherited from colonial times. Colonial Land is a freehold 
system existing in Freetown and the Western Area. Customary 
Land is a leasehold system, which prevails throughout the 
rest of the country. There is no land titling system to 
validate property rights. Because it can be difficult to 
verify ownership, land is often sold or leased illegally, 
thus restricting and complicating investment. Furthermore, 
foreigners cannot own land under either system but can lease 
land up to 99 years. The Ministry of Lands placed a 
moratorium on selling land in November, 2008, because of a 
variety of abuses. The government is receiving support from 
external donors to redesign the land tenuring system. 
 
¶10. Sierra Leonean citizens can acquire private land (in 
Freetown and the Western Area only) in a fairly 
straightforward fashion. State lands can be obtained from the 
State Lands Committee and the Ministry of Lands via a 
bureaucratic process that typically takes 65-70 business 
 
FREETOWN 00000024  002 OF 008 
 
 
days. Under the Customary Land system, an investor can lease 
land by entering into a joint venture for economic purposes 
with the local paramount chief who controls the land in his 
district. This system is designed to protect the livelihood 
of indigenous traditional users of the land: householders, 
subsistence farmers, herders, and small producers. 
 
¶11. Mortgages exist but since there is only a small stock of 
modern housing and other buildings, the real estate market is 
minimally active and mortgages are not common. When they 
exist, mortgages can carry long terms, but are more commonly 
of short duration and high interest. Short-term bank loans 
for new construction are more common. 
 
¶12. Privatization: In its privatization program of 24 
publicly owned enterprises, the GoSL is looking for 
investors, especially foreign investors, who will bring 
significant capital, but also expertise on how to improve the 
productive and financial performance of the company to be 
privatized. Foreign investors are invited to participate in 
every stage of the privatization process. The GoSL does want 
to avoid asset stripping, however, especially in the banking 
sector, which has attracted international investor attention. 
 
¶13. Visas: U.S. citizens must have a visa to enter Sierra 
Leone, obtainable from the Sierra Leonean embassy in 
Washington or at other Sierra Leonean embassies. Airport 
visas are available but cost $100 and are not issued quickly. 
Foreign investors must have a self-employment/work permit 
from the Ministry of Labor, which takes six weeks to four 
months or longer to obtain and costs $85. A foreigner also 
must have a residence permit that can be obtained in a few 
days, but often takes longer. There is an application fee of 
$100 and the permit costs $1,000 for entrepreneurs and $1,660 
for employees. 
 
¶14. Registry and Licenses: Companies have to register but 
private investors generally do not consider the business 
registration process as a major impediment to investing. 
Registration formerly took 2-4 weeks and cost about $200, not 
including legal fees that ranged from $400 to $5,000, making 
registration among the most costly in the world. Recent 
changes in the law removed the requirement for attorneys to 
prepare Articles of Corporation or for permission from the 
Bank of Sierra Leone and advance taxes before registering, 
which should significantly reduce business registration costs 
and times. There is a shortage of reliable information on 
procedures and fees and there are bothersome redundancies. 
The high cost of business registration combined with lax 
enforcement results in a high rate of non-compliance and 
contributes to flourishing informal economic activity. 
 
¶15. There are also three types of mandatory business 
licenses: general licenses for every business, special 
activity licenses for executing certain activities (hotel, 
supermarket, restaurant, factories, construction), and 
licenses for specific sectors like tourism, 
telecommunications, and mining. 
 
¶16. Mining and Fisheries: The mining sector is open to 
foreign investors. The cost of mining licenses depends on the 
type of activity and citizenship. Non-exclusive prospecting 
licenses are $10-50 per square mile. Exclusive prospecting 
license $50-200 per square mile, depending on the mineral. 
Exploration licenses are $100-400 per square mile for three 
years. Mine leases are for a maximum of 25 years (renewable 
for 15 added years) and cost $500-5,000 per square mile, 
depending on the mineral. 
 
¶17. For mining investment over $100 million, the Minister of 
Mineral Resources can negotiate the conditions, fees, and 
taxes with the investor on behalf of the Government. 
 
¶18. Some of the other important fees in the mining sector are 
as follows: 
Alluvial Diamond Exporters license: $40,000/year ($25,000 
half year). 
Alluvial Diamond Exporter Agent's certificate: $5,000/year 
($3,000 half year). 
Alluvial Diamond Dealer's license: Non-Citizen $5,000/year 
($3,000 half year), not including monitoring and 
rehabilitation fees of $567/year ($350/year). 
Gold Exporter's license: $3,000 per year. 
Gold Exporter Agent's certificate: $ 1,000/year. 
Gold Dealers license: Non-Citizens $1000/year. 
Gold Mining Company Manager Certificate: Non-Citizen 
$167/year. 
 
¶19. In fisheries, vessels must be registered and a fishing 
 
FREETOWN 00000024  003 OF 008 
 
 
license obtained. Obtaining an industrial fishing license 
requires an offshore account in Sierra Leone and the operator 
must employ 45% Sierra Leoneans as crew members. The 
licensing process is speedy after the vessel is inspected. 
 
¶20. The following license fees include: For vessels over 250 
tons, a shrimp license costs $60,000 for a year plus 
royalties of $18,000 per vessel. Fish trawlers over 250 tons 
pay $40,000 per year with royalties of $15,000. Tuna purse 
seiners pay $18,000 per year; tuna long liners pay $12,000 
per year; and purse seiners for small pelagics pay $15,000 
per year. Fish processing ships pay $20,000 per year. 
 
¶21. Impact of policies and economic trends on FDI: With the 
end of the war in January 2002, massive infusions of outside 
assistance helped Sierra Leone to recover and rebuild. GDP 
growth rates immediately rose to six percent and higher as 
agriculture recovered, legal diamond production and exports 
grew, manufacturing showed modest gains, and construction 
expanded. 
 
¶22. FDI inflows reached $32.5 million in 1990 before the 
outbreak of the violent civil strife in 1991, and then 
declined rapidly for a decade.  FDI spiked again in 2000 at 
$39 million. It declined again in subsequent years, but 
jumped to $83 million in 2005 before slowly falling to $59 
million in 2006. The heightened figures in the last several 
years reflect mining investments. 
 
¶23. Important impediments to foreign investment remain. There 
is a shortage of skilled workers and professionals. Many 
judges, lawyers, doctors, civil servants, engineers, and 
other professionals left the country and those who remain 
often lack the means to carry on their duties properly. 
Corruption is a problem and the independent Anti-Corruption 
Commission created in 2000 has yet to have a large impact on 
the higher levels, though a revised law in 2008 will likely 
improve its efficacy. 
 
¶24. Sierra Leone's trade policies are relatively open and 
non-tariff barriers have been eliminated. Tariff rates are 
converging with those of its neighboring Economic Community 
of West African States (ECOWAS) and West African Economic and 
Monetary Union/CFA Franc zone (WAEMU) countries. Import and 
export licenses have been abolished for all but a small 
number of products. However, importing and exporting problems 
have less to do with policy than with practice. Customs 
clearance is slow, cumbersome, costly, and opaque. The 
average 14 days for import clearance is among the world's 
worst. All goods are subject to lengthy and complicated 
customs procedures, although the GoSL is reportedly 
considering reducing its customs registration and 
documentation requirements. Tariff schedules are not always 
transparent which allows arbitrary assessments that can be 
challenged only with difficulty as appeals processes are ill 
defined and lengthy. Sierra Leone continues to use the 
Brussels Declaration of Value, as it has not yet adopted the 
WTO Agreement on Customs Valuation. Sierra Leone uses minimum 
or reference values for rice, flour, sugar, cement, used 
clothing, and clothing accessories and not having adopted the 
WTO Agreement leaves customs agents with excessive power and 
increases the costs of imports. 
 
¶25. Improved economic conditions since the civil war ended in 
January 2002, along with greater political stability and a 
more forward-looking government policy, have led to some new 
foreign investment. The telecommunications sector has seen 
rapid expansion in mobile telephones. In banking, Malaysian 
investors have opened the International Commercial Bank and 
Nigerians investors have opened several banks including the 
First International Bank, Access Bank, United Bank of Africa, 
Skye, First International and Guaranteed Trust Banks. 
Standard Chartered Bank closed during the war but reopened 
since. The Ecobank Group has also opened a branch in 
Freetown. The current hike in consumer prices is, in part, 
the result of the reduced supply of rice and the ban on 
exporting rice form the major producers and the global 
financial crisis. The new administration's pro-business 
pronouncements have encouraged more investors to explore 
possibilities in Sierra Leone, but most are waiting to see 
action to back-up President Koroma's statements. 
 
¶26. Mining has expanded greatly with increased legal diamond 
exports conforming to the Kimberley Process. The reinvestment 
in rutile and bauxite mining in the southwestern part of the 
country will put Sierra Leone again among the world's top 
producers, though an accident in July slowed production in 
¶2008. Between 2004 and 2006 Sierra Rutile received $12 
million from the European Union in start up capital. There 
 
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are also large iron ore deposits, but it is not yet clear 
whether they can be economically exploited. 
 
¶27. With the aid of the World Bank and key international 
donors, the GoSL developed its Poverty Reduction Strategic 
Paper (PRSP), which expired in 2007. It is putting its PRSP 
plan into effect and international donors -- the World Bank, 
UK, U.S., EU, and others -- are assisting.  The PRSP's three 
pillars are good governance, security and peace; pro-poor, 
sustainable economic growth, food security, and job creation; 
and human resource development. The PRSP II, which is still 
under review, follows these same precepts. 
 
¶28. On December 15, 2006, the IMF Executive Board found that 
Sierra Leone had achieved completion under the Heavily 
Indebted Poor (HIPC) initiative and will provide debt relief 
in line with the HIPC framework. 
 
¶B. Conversion and Transfer Policies 
 
¶29. There are no restrictions on converting or transferring 
funds associated with an investment. Investors can withdraw 
and remit any amount from a commercial bank and have it 
transferred into any freely convertible currency and at legal 
market clearing rates. Sierra Leonean banks are well 
connected with the international banking network. There are 
no plans to change remittance policies. 
 
¶30. Sierra Leone has a floating exchange rate. The Leone 
fluctuates, but overall has depreciated slowly over recent 
years, mainly due to demand for financing current 
consumption, especially of imported petroleum products, and 
for national reconstruction. 
 
¶31. Estimated exports in 2008 from the Economist Intelligence 
Unit (EIU) were $330 million while imports were $440 million. 
Diamond exports were an estimated $170 million. The current 
account balance was estimated at negative $190 million, or 
about 8.2 percent of GDP. 
 
¶32. There are no legal restrictions on obtaining foreign 
exchange. The Central Bank conducts frequent foreign exchange 
auctions, typically on a weekly basis, but limits a single 
bidder to $100,000. The auctions are far from sufficient to 
meet the needs of importers. Additional foreign exchange is 
available through the banking system, but banks will provide 
cash only to customers who have deposited cash. Customers who 
have deposited transfers can obtain only transfers. 
 
¶33. The Investment Code guarantees foreign investors the 
right to repatriate earnings and the proceeds of sales of 
assets, and also allows expatriate employees to repatriate 
earnings. 
 
¶C. Expropriation and Compensation 
 
¶34. There is no history of expropriations in Sierra Leone. 
 
¶D. Dispute Settlement 
 
¶35. Sierra Leone adopted the UK's legal system and common law 
system. The traditional and Islamic Law systems employed 
decide many personal property and inheritance issues outside 
the capital of Freetown. The legal system inherited from the 
UK protects property and contract rights in the modern sector 
and there have been few notable issues with property or 
contract rights affecting US investors. Investors have access 
to the judicial system, but the system is slow and is widely 
reported to be subject to financial and political influence. 
Arbitration clauses in contracts and foreign judgments are 
respected.  Officials point to arbitration and judicial 
findings in Europe against the Government with which it 
complied. 
 
¶36. The Law Reform Commission is considering a new Commercial 
Law, but progress has been slow. 
 
¶37. Sierra Leone is a party to the Convention on Settlement 
of Investment Disputes Between States and Nationals of Other 
States (The Washington Convention), which it ratified and put 
into force in October 1966. 
 
¶38. An important U.S. investor has claimed repeatedly that 
its competitors are routinely allowed to undervalue its 
imports, thus paying less in duties and underselling the U.S. 
firm. The investor's complaint has gone unresolved for 
several years. Other investors complain that undervaluing 
goods bound for retail is necessary to reduce what many 
believe are exorbitant customs duties. The new administration 
 
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has engaged the various stakeholders to find a permanent 
solution, but they have yet to resolve the issue. 
 
¶E. Performance Requirements and Incentives 
 
¶39. The GoSL has established no performance requirements 
prescribing mandatory percentages of exports, domestic 
content, required domestic inputs, the transfer of technology 
or proprietary knowledge, or limiting access to foreign 
exchange. 
 
¶40. The annex to the Investment Code law will define the 
investment incentives to be offered and in various sectors 
but has not yet been released. Key areas for incentives 
include agro-processing and value-added activity in 
fisheries. Both sectors represent important potential in 
Sierra Leone. 
 
¶41. No performance requirements are in place to require 
maintenance or expansion of a foreign investment. There are 
likewise no requirements that nationals own shares that the 
share of foreign equity is reduced over time, or that 
technology is transferred under certain terms. There are no 
offset requirements. 
 
¶F. Right to Private Ownership and Establishment 
 
¶42. Foreign and domestic entities have the right to establish 
and own business enterprises and engage in all sorts of 
remunerative activities. Foreigners are free to acquire and 
dispose of interests in business enterprises. 
 
¶G. Protection of Property Rights 
 
¶43. Mortgages exist but are not common as property rights are 
difficult to secure, given the complexities of the land 
tenure system. Officially there is complete and open access 
to the court system if an individual or enterprises thinks 
its interests to be compromised, but judicial practice is 
widely reported to be open to political or financial 
influence. 
 
¶44. The GoSL is taking steps to develop policy and laws that 
will bring it into compliance with TRIPS. So far, these 
measures do not include amendments to the copyright law, 
which is 40 years old. Per WTO agreements, Sierra Leone had 
until 2006 to fully implement TRIPS but extensions were 
recently granted to all Least Developed Countries until July 
1, 2013. 
 
¶45. Popular music and films are illegally copied and sold on 
a substantial scale. While some recorded American music and 
films are affected, this practice mostly affects local and 
regional music and Nigerian films. 
 
¶H. Transparency of Regulatory System 
 
¶46. Red tape and excessive delays are gradually being 
streamlined by SLIEPA. Sierra Leone has moved to 156th in the 
International Finance Corporation's "Doing Business" ranking, 
and occupies the 7th position out of the 15 ECOWAS countries. 
Though Sierra Leone is top-ranked in West Africa in terms of 
starting a business, issues with licenses, contract 
enforcement, and high tax rates, are considerable problems. 
 
¶47. The GoSL recognizes the need for greater regulatory 
clarity and efficiency. The Law Reform Commission is working 
in that direction, but once updated laws are promulgated, the 
Government often is slow to develop the administrative rules 
for their application. 
 
¶48. One notable effort to improve clarity is the Government's 
establishment of a "one stop center" where investors can 
obtain all required permits and licenses. To this end, SLIEPA 
replaced the Sierra Leone Export Development and Investment 
Corporation (SLEDIC). SLEDIC was dissolved in December 2007 
and SLIEPA has now fully taken over. The agency has 
encouraged agricultural production and other activities 
geared towards export; provide exporters with marketing 
services; identify and encourage potential investors in 
agriculture and other economic sectors; and promote 
investment opportunities in Sierra Leone, both locally and 
internationally. 
 
¶49. The Government does not use taxes or labor, environmental 
or other standards to inhibit foreign investment. 
 
¶I. Efficient Capital Markets and Portfolio Investment 
 
 
FREETOWN 00000024  006 OF 008 
 
 
¶50. The commercial banking sector is sound. Citizens and 
foreigners have access to credit under the same market terms. 
Interest rates are decreasing with the addition of new banks 
and other financial institutions. They now range between 
17-25% Because of the Government's feeble tax revenue 
generating capabilities, the Central Bank holds frequent 
(generally weekly) bond auctions. The Government's bonds pay 
about 25 percent thus crowding out credit flows to production 
or factor markets. 
 
¶51. As a rule, banks do not invest in equity projects. The 
land tenure system makes it difficult for a lender to 
identify the true owner of a property and makes most property 
useless as loan collateral. An inefficient judicial system 
and the lack of bankruptcy laws make it very difficult for a 
lender to recover collateral in the event of a default. 
 
¶52. Credit is rarely a problem for foreign investors as they 
typically bring in capital from outside the country and have 
well-established banking relationships that enable them to 
obtain working and trading capital. 
 
¶53. As of November 2005, the Bank of Sierra Leone estimated 
the assets of the largest banks as follows: 
Rokel Commercial Bank: $52 million. 
Sierra Leone Commercial Bank: $67 million. 
Standard Chartered Bank: $53 million. 
Total assets of the banking sector: $173 million. 
Updated figures are unavailable. 
 
¶54. There is no evidence of cross-shareholding and stable 
shareholder arrangements in Sierra Leone. 
 
¶J. Political Violence 
 
¶55. There have been no incidents in recent years of 
politically motivated damage to projects or installations. 
During the widespread violence that occurred from 1991 to 
2002, mining installations and a great deal of physical 
infrastructure was destroyed. After the war ended in January 
2002, a successful demobilization, disarmament, and 
reintegration (DDR) program followed and a large UN 
peacekeeping mission guaranteed security. The UN peacekeepers 
departed in December 2005 and security responsibilities are 
in the hands of the Sierra Leonean army and police, which the 
UK government has done much to train and equip. The United 
Nations Integrated Office in Sierra Leone (UNIOSIL) which 
oversaw all UN agencies in-country, completed its mandate in 
September 2008. The follow-on mission, the United Nations 
Peacebuilding Integrated Office in Sierra Leone (UNIPSIL) is 
much smaller, and supports government institutions and human 
rights monitoring activities. Although Sierra Leone is a 
"fragile state," the country is calm so insurance costs and 
risk premiums should not reflect the earlier realities of the 
1990s. 
 
¶56. Despite the recent coup in Guinea, Sierra Leone remains 
stable. Disruption of cross border trade with Guinea has a 
direct effect on availability and cost of foodstuffs and 
other goods. There is the potential for political rallies to 
snarl traffic and damage property. With extensive UK and UN 
training and new equipment, the Sierra Leone Police have 
increased capacity to handle such events and performed well 
during the 2007 national elections. The security agencies are 
cautiously monitoring the political situation in Guinea to 
guard against destabilizing spillover of unrest into Sierra 
Leone. 
 
¶K. Corruption 
 
¶57. International companies identify corruption as an 
obstacle to investment, ranking Sierra Leone near other West 
Africa countries for corruption. Bribes, kickbacks, 
extortion, and skimming on contracts and payments are common 
forms of corruption. 
 
¶58. Sierra Leone signed the UN Convention Against Corruption 
in December 2003 and ratified it in September 2004. The GoSL 
established the independent Anti-Corruption Commission (ACC) 
in 2000. It is charged with investigating cases and educating 
the public to reduce corruption in its many forms. The 
Anti-Corruption Act was strengthened in a revision in 2008, 
adding twenty new offenses to the law, increasing the 
penalties, and giving greater investigative and prosecutorial 
powers to the ACC. 
 
¶59. The ACC has many pending investigations, but has yet to 
prosecute under the new law. Efforts in 2008 focused on 
enhancing internal capacity through reorganizing and 
 
FREETOWN 00000024  007 OF 008 
 
 
training, as well as outreach to ministries to stress the 
importance of fighting corruption and procurement 
irregularities. The judicial system, which must try the cases 
the ACC develops, is inefficient and widely believed to be 
corrupt. 
 
¶60. The Anti-Corruption Act is not used disproportionately 
against foreigners. 
 
¶61. Sierra Leone's score on Transparency International's (TI) 
2008 "Corruption Perception Index" has dropped for the third 
consecutive year to 1.9, ranking Sierra Leone 158 out of 180 
countries (tied with seven other countries). In Sierra Leone, 
TI operates the National Accountability Group (NAG), an 
important local NGO. The Campaign for Good Governance is 
another local watchdog organization. 
 
¶L. Bilateral Investment Agreements 
 
¶62. Sierra Leone does not have a bilateral investment treaty 
or taxation treaty with the U.S. 
 
¶M. OPIC and Other Investment Insurance Programs 
 
¶63. Between 2004 and 2006, the European Union provided $12 
million in start-up funding to Sierra Rutile for the restart 
and expansion of its mineral sands mine in southwestern 
Sierra. The company is also exploiting nearby substantial 
bauxite deposits. Phase One will generate about 110,000 
metric tons of rutile (titanium oxide), which is an important 
ingredient in paints, paper, and plastics. President Koroma 
commissioned Phase Two, which consists of the second dredge; 
current production is projected at 200,000 metric tons. 
Before violent civil strife destroyed the mine's equipment in 
the 1990s, Sierra Leone was the world's largest rutile 
producer. 
 
¶64. Sierra Leone is a member of the Multilateral Investment 
Guarantee Agency (MIGA), part of the World Bank. 
 
¶N. Labor 
 
¶65. Sierra Leone suffers from a shortage of educated and 
skilled workers and professionals.  Brain drain to Europe and 
North America has been a significant drag on the economy for 
some years. 
 
¶66. Formal sector employment is largely governed by 
collective bargaining agreements between employers and 
unions. Such agreements cover various sectors:  tourism, 
commerce, petroleum, manufacturing, media, entertainment, 
financial services, general services, and public utilities. 
The statutory minimum monthly salary is $8.50, but under the 
collective agreements, the minimum throughout the formal 
sector is $24. The minimum figure goes up with qualifications 
so that a machine operator in manufacturing must be paid a 
minimum of $43, rising to $55 for a senior operator. 
 
¶67. The standard workweek is 40 hours with two consecutive 
days off mandatory, though security personnel typically work 
a 60 hour week. Work beyond 40 hours is paid at 50% overtime 
and required work on rest days is 100% overtime. 
 
¶68. Companies can find an employee redundant for commercial 
or financial reasons after trying and failing to find 
alternative employment, in consultation with the union. The 
employer can discharge workers only on the basis of 
seniority, with more junior workers being dismissed first. 
Employers must give two months notice and pay redundancy 
compensation according to a steeply rising schedule. For 
example, the employer must pay a worker with 14 years 
seniority more than two years salary as compensation while 
the employer owes twenty-year employee more than three and a 
half years salary as compensation.  In practice, evidence 
suggests these regulations are often ignored due to 
corruption within the Ministry of Employment. 
 
¶69. Workers can be dismissed for incompetence, inefficiency, 
violation of rules, or serious offenses in a reasonably 
straightforward manner. After two written warnings an 
employee can be dismissed without compensation. There is an 
appeals process via employer-union consultations and possible 
intervention by the Commissioner of Labor. The Industrial 
Court hears dismissal cases and other disputes and heard 170 
cases between 2000 and 2003. 
 
¶70. Contributions to the national pension plan, NASSIT, are 
mandatory. The employer pays 10 percent of the worker's 
salary and the worker contributes 5 percent. 
 
FREETOWN 00000024  008 OF 008 
 
 
 
¶O. Foreign Trade Zones/Free Trade Zones 
 
¶71. Sierra Leone does not operate a duty free zone, but plans 
are under way to establish an export-processing zone with 
duty free status for re-exports. 
 
¶72. The GoSL and Chinese company Henan Guoji Group launched a 
joint venture to develop an industrial and trade zone. The 
GoSL provided the land and existing buildings (the old 
National Workshop facility long slated for privatization) and 
preferential conditions, while the Chinese company is 
supplying capital, expertise, and some workers. Construction 
materials such as sliding windows and roofing materials are 
currently sold in the local market. 
 
¶P. Foreign Direct Investment Statistics 
 
¶73. According to 2008 UN figures (UNCTAD World Investment 
Report, 2008) Sierra Leone attracted $81 million in foreign 
direct investment in 2007. 
FEDZER