By Politico staff writer
Sierra Leone’s Minister of Finance Jacob Jusu Saffa has said that regardless of huge debts accumulated in the past, domestic revenue collected is “sufficient” for the government to take care of salaries without recourse to bank borrowing.
“Our domestic revenue is sufficient for us and this government to take care of our salaries. Now we don’t borrow from the central bank to pay salaries, our domestic revenue collection is sufficient enough to take care of our domestic salaries, sufficient enough to take care of our statutory obligations, notably debt services,’’ he stated.
He made this statement during the weekly government press conference on Thursday 8th April 2021.
He said the reason for what he called “the quantum limp” was as a result of the increase in daily revenue collection with daily revenue generation increasing from less than Le10billion to Le20billion, Le440billion per month.
The minister further noted that although the government is paying about $10m-$11m on debt service which includes both domestic and external, it has also through the leadership of President Bio mobilized external grants from less than $50million in 2017 to $438million in 2019, and between 2018 to February 2021, it has mobilized $900million for different project activities with nearly 67% being grants.
He stressed that all this has been made possible because of the political leadership provided by the President and effective management of the state and the continuous engagement with partners, and said it took the government eight months to restore the relationship with IMF after it had been battered by the former government.
Saffa said when Covid-19 struck in 2020 and realizing that it was going to be very difficult to recover from its impact on the economy, the government introduced the quick economic response action plan added to the $100million grant from World Bank.
He stated that in the midst of the pandemic, the government increased spending in education, ensured promptness in the payment of salaries across the country, undertook infrastructural development and invested in the health sector with more nurses and health care workers recruited, and also increased electricity in provincial areas, among others.
On expenditure on Covid-19, he stated that the government has spent $40million on the pandemic and in the area of agriculture, purchased from the budget the highest quantity of tractors deployed across the country for the start of the planting season.
Commenting on the deficit GDP ratio, he noted that it was inherited at about 8.8% in 2018 and dropped to 5.6% and 3.3% in 2019, adding that the government also inherited inflation at 17.5% and projected at the time to go by December to 18% for which he said that consultations were held with the IMF.
He stated that in order to address the issue of inflation, the government through the special credit faculties injected $50million into the system to provide foreign exchange credits to importers in the provision of essential commodities which he said accounted for the lack of shortage in the flow of commodities across the country.
The exchange rate, he noted has been relatively stable for over 18 months now with the country’s reserve moving from 3.5 months of import to nearly five months currently.
He also highlighted the benefits of the Munafa funds, the school buses, the NacSA social safety net cash transfers to vulnerable groups and to individual households, the youth farms which he said will provide about 10,000 jobs across the country. Saffa said the government is set to revamp hospitals and mortuaries with x-ray services and deep freezers.
Copyright © 2021 Politico Online (09/04/21)
