Permit me to pay tribute to all other former Governors who have contributed immensely to our institutional development over the years. I want to take this opportunity to thank them all for their contributions in reforming the Bank and upholding the dignity and effectiveness of our noble institution. Your Excellency, distinguished guests, the recent global economic and financial crisis was a wake-up call to the realisation that low and stable inflation, a sound banking system, as well as high and sustainable economic growth, though necessary, are not sufficient conditions for financial stability. As you are aware, the Bank had developed the Financial Sector Development Plan (FSDP) which was approved by cabinet in 2009, to address the shortcomings in the financial sector. It is expected that funding for the FSDP would be provided under a basket fund arrangement with development partners, including KfW, GTZ, and AfDB, with the World Bank assuming a leading role. The Bank is in the process of setting up a secretariat for successful implementation of the FSDP for which the Head has been appointed. Your Excellency, distinguished ladies and gentlemen, permit me to proceed with the discussion on the highlights of the reform policies to reposition the Bank and the current state of their implementation. Strengthening the supervisory role of the Bank of Sierra Leone Your Excellency, distinguished guests, even though the Bank was granted legal sanction by the Bank of Sierra Leone Act 2000, its powers and operational autonomy are limited.

Also, government’s drive towards improving electricity supply and distribution, with the completion of the Bumbuna Hydroelectric Power Plant and additional thermal plants, contributed to increased productivity particularly in the manufacturing sector. However, going forward, there is a need to achieve a higher growth rate to stimulate economic activities and create more employment. Your Excellency, ladies and gentlemen, the state of the economy was presented by the Honourable Minister of Finance and Economic Development, in his statement of Economic and Financial policies for 2011. During 2010, fiscal policy was geared towards enhancing revenue mobilisation to support government’s expanded capital expenditure requirements. Emphasis was therefore placed on improving tax administration by reducing inefficiencies in tax collection and increasing the levels of compliance. The performance of the newly introduced Goods and Services Tax (GST) was encouraging, with a compliance rate of 60 percent. This is an indication of hope for future revenue performance in Sierra Leone. On the other hand, expenditures exceeded the budgetary targets due to salary increases, expenditure on the health sector and infrastructural outlays. In this regard, the Bank would like to stress that the global financial crisis has resulted in global austerity measures worldwide, and Sierra Leone should not be left behind in making difficult financial choices. Compared to 2009, the year 2010 reflected a wider deficit which was financed mainly from the drawdown of Multilateral Debt Relief Initiative (MDRI) resources, some external financing and domestic borrowing mainly through Ways and Means Advances.