Sierra Leone’s State-Owned Enterprises Face Mounting Debt of US$36.54 Million

Recent reports indicate that Sierra Leone's state-owned enterprises (SOEs) are under significant financial pressure, with a total debt of US$36.54 million as of December 2023. The Sierra Leone Telecommunications Company (SIERRATEL) is the largest contributor, accounting for an overwhelming 80.71% of this debt, raising serious concerns about the financial management and long-term sustainability of SOEs in the country.


The Public Debt Management Division revealed that the bulk of SIERRATEL’s debt is tied to loans intended for modernizing and expanding telecommunications infrastructure. Key projects, such as the CDMA initiative, were financed through loans from international creditors, including Exim Banks of India and China. While SIERRATEL leads the debt burden, other SOEs like the Guma Valley Water Company hold smaller portions of the debt, primarily to fund infrastructure projects like the Freetown Wash and Aquatic Environment Revamping Project.

The debt has increased from US$34.04 million in early 2023 to US$36.54 million by year-end, signifying a pressing need for fiscal reforms and better financial oversight. Of this debt, domestic liabilities accounted for US$7 million, making up 19.2% of the total, while government on-lending to SOEs represented US$29.54 million.


The Electricity Distribution and Supply Authority (EDSA) follows SIERRATEL as the second-largest debtor among SOEs, with 19.68% of the total debt, mainly due to costs related to fuel purchases for electricity generation in Freetown. Smaller entities like Sierra Leone Postal Services and Guma Valley carry relatively minor shares of the debt, while Sierra Leone Commercial Bank and Rokel Commercial Bank have reported no outstanding loans during this period.

The escalating debt highlights the need for strategic interventions and reform in the management of Sierra Leone’s SOEs to ensure financial sustainability and mitigate future fiscal risks.

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