Political Economy of Extractives Governance in Sierra Leone

Sierra Leone is still recovering from a
brutal civil war (1991-2002), fuelled in part by a valuable
and easily extractable natural resource (diamonds). Sierra
Leone now stands on the verge of an unprecedented period of
economic growth, driven primarily by revenues from
large-scale iron ore mining. Yet it continues to face many
governance and developmental challenges. The rapid rise of
the extractives governance agenda in Sierra Leone requires
an equally swift, yet strategic response from all
stakeholders: the Government of Sierra Leone (GoSL),
development partners (DPs), civil society organizations
(CSOs), communities, and mining companies. This report uses
a 'value chain' approach to mining governance
which highlights the critical stages through which a
resource dependent country is expected to progress as it
seeks to transform resource rents into economic growth and
sustainable human development. The objective of this study
is ultimately to improve the management of the natural
resource endowment, enjoyed by Sierra Leone, in a manner
that will allow the revenues generated from natural resource
extraction to contribute in an optimal manner towards
sustainable economic growth. Specifically, the study focuses
on mining (iron ore, diamonds, and other minerals) and to a
much lesser extent, oil and gas. By using the 'theories
of change' approach to political economy analysis, the
report looks at the historical challenges around extractive
governance, identifies systemic features, and
characteristics of 'the problem', extrapolates and
analyses the incentives shaping the activities and behaviors
of key stakeholders, and then lays out a possible platform
for engagement based on clearly identified entry points.
This report is organized as follows: chapter one is
introduction, chapter two presents a summary of previous
analytical work on the political economy of Sierra Leone
with special reference to the extractives sector, its
governance past, and possible governance futures. Chapter
three undertakes an in-depth analysis of the extractives
value chain in Sierra Leone and chapter four identifies key
stakeholders across this value chain, noting their influence
on extractives management policy and implementation, their
potential relationships with other stakeholders, and
influence over policy outcomes. Chapter five identifies and
highlights suitable entry points for policy dialogue on
extractives-led governance in Sierra Leone and possible
project and technical assistance interventions across the
value chain.