It is early days yet to find out if this new government will take the private sector rhetoric beyond mere platitudes and move into meaningful action. Many Ministers fail to embrace the private sector, only to return to a vacuous sector when they leave office. I consider it obligatory to make reference to the “long bench”, if only because I do not want our new Ministers to repeat the mistakes of the past.
Every government professes to support the private sector, referring to it as the “engine of growth” but normally fails to put oil in the engine. The new Finance Minister in his recent budget speech continued the refrain……. “Mr. Speaker, Honourable Members, Government recognizes the important role of the private sector in promoting sustainable growth and job creation. Government will therefore sustain efforts aimed at providing a conducive environment for the private sector to thrive. In this regard, Government is working with development partners to design and implement reforms to stabilize the economy, improve the business regulatory environment, enhance access to
finance and provide basic infrastructure to improve the ease of doing business.”
President Bio recently delivered the shortest and most focused speech at a State Opening of Parliament in recent memory. No “Rebuilding the wall of Jerusalem in 52 days”, or “Parting of the Red Sea” references in his speech, no lambasting of the opposition and no references to “Tok and do”. The speech, borrowing heavily from the condensed manifesto went straight to “the heart of the matter” (So, Bo school boys know how to summarise!). First and foremost, he talked about how his government’s priority project, “Feed Salone” will ignite agricultural productivity and safeguard food security. “Human Capital Development” will nurture the skills required for the industries of the 21st Century, empowering our workforce for a transformative future. The “Youth Employment Scheme” will provide job opportunities for youth. The “Technology and Infrastructure Initiative” will serve as an engine for sustained economic growth, harnessing the power of innovation and robust infrastructure to propel Sierra Leone to middle-income status. Finally, his government will embark upon “Revamping the Public Service Architecture.”
His first four priorities are lofty, but easy-to-grasp ideas that cannot be achieved without oiling the private sector. The private sector is the main engine of job creation and the source of almost 9 of every 10 jobs in the world. The private sector in Africa accounts for over 80 per cent of total production, two thirds of total investment, and three fourths of lending within the economy. If the private sector is going to deliver its full development potential in this regard, then countries need to get the climate right for both domestic and foreign investment. Africa needs to diversify economically and add value through commodity-based industrialization and raise productivity in agricultural and nonagricultural sectors. The continent also needs to promote industrialisation to meet the requirements of private businesses, in particular SMEs that are the backbone of the African private sector. Africa’s industrial policies should be coherent with other policies, including trade policies, to promote value addition and economic diversification. Mobilizing finance to support the private sector in Africa has also been underscored as a crucial element.
Private investment in Sierra Leone however remains low. It is constrained by a cumbersome regulatory environment, administrative barriers, unstable macroeconomic environment, weak infrastructure, limited access to finance, unskilled labour and corruption. Despite our optimism and the effort of government, Sierra Leone is still a high tax country and the poor state of infrastructure is still a huge barrier to growth.
The Tejan Kabbah government, cognisant of the failures and inefficiencies of the public sector, realized the need to have the private sector play a leading role in the revitalization of the economy and embarked upon privatizing many of the State Owned Enterprises (SOEs), with the setting up of the National Commission for Privatisation (NCP). Several decades later many of the SOEs slated for privatization are still in government hands, with inefficient management teams and high indebtedness. The problems of many of them are compounded by ineffective Boards and considerable interference by government in their operations.
Sadly, this is the situation into which many of our new Ministers have sleep-walked. A review of the recent budget allocation figures for MDAs indicates that funds are not only grossly inadequate but may not be available in a timely manner for executing their duties. Further increases in the price of fuel, rising inflation and domestic interest rates and contingent liabilities arising from the inefficiencies of the operations of SOEs are bound to exacerbate the problem. Foreign direct investments including public private partnerships would be required to make most sectors tick including the ones on the President’s priority agenda.
If this Government is to succeed, Ministers should realise and ensure that the priorities stated by the President are predominantly driven by the private sector, with government serving as an enabler and not putting bureaucratic hurdles in the path of private sector investors and operators. The private sector should drive the food production, youth employment, technological and infrastructure improvements and many other aspects of the government’s priorities.
There is a danger however that many new Ministers may not realise this and may be tempted to wallow in the mistake made by some of their predecessors in shutting out the private sector. Many Ministers in previous governments never bothered to engage the private sector meaningfully. They were too preoccupied with “other issues” and could not even countenance the needs of many groups in the private sector. They could not be bothered about the contractors or consultants who were unfairly not considered for contracts, the contractors who either did not get paid at all or only got paid when the money was almost worthless or the private sector organisations which were facing severe constraints and had to lay off staff or the potential investors who were either too burdened with taxation or unfairly edged out because they were not “connected”. When private sector players asked for an audience, they were often kept in their waiting rooms for hours on the proverbial “long bench” without addressing their problems or granting them audience. Sadly, when some of these Ministers leave office and realise they need to survive in the same private sector they had shunned, they have the big climb down of waiting to see their new replacements, who may also be inclined to carry on business as usual, leave them on the “long bench”.
Ministers should bequeath an important legacy after they leave office. It behooves our new Ministers to learn from the mistakes of some of their predecessors and leave a good legacy-especially one of embracing private sector growth. I am encouraged by the fact that many of the young new Ministers, including the Chief Minister seem refreshingly open and ready to engage! They have not professed to be able to turn water into wine. May the “long bench” not be their portion in future!
My advice to new Ministers? Embrace the private sector and behold the “long bench”.
Ponder my thoughts.