Protecting Foreign Investors Against Corruption in Sierra Leone

Corruption has been perceived as one of the major causes of the 10 years of rebel war in Sierra Leone. The scourge has led to the deprivation of the vast majority of the people such that the country is considered as one of the poorest nations in the world in spite of its rich natural resources. This has been perpetuated and consolidated by undemocratic practices, bad political governance, bad economic governance and management and bad corporate governance. The public service itself has been characterised by a plethora of problems including poor staff motivation, cumbersome and outdated regulations and procedures, weak system of accountability and transparency and an unsystematic and uncoordinated human resource development all of which created a fertile ground for the seeds of corruption to grow and flourish.

The Government of Sierra Leone being committed to the fight against corruption set up the Anti-Corruption Commission through an Act of Parliament in February 2000 with a mandate to prevent all forms of corruption in Sierra Leone. In his maiden address to parliament President Ernest Bai Koroma reiterated his commitment to the fight against graft and zero tolerance policy for corruption.

Like many developing countries, Sierra Leone is seeking to attract foreign investors to enable the country develop. Many investors who travel Sierra Leone are frequently subjected to various forms of corruption. “Doing Business In Sierra Leone: A Country Commercial Guide for U.S. Companies” prepared by the U.S. & Foreign Commercial Service and U.S. Department of State, 2005 states that ‘International companies identify corruption as an obstacle to investment, ranking Sierra Leone near other West Africa countries for corruption. Bribes, kickbacks, extortion, and skimming on contracts and payments are common forms of corruption.”

To fight against corruption aimed at foreign investors, the Anti-Corruption Act 2000 created the offence of impeding foreign investment. Section 14 of the Act provides as follows:

“Any public officer who knowingly—

a. performs or abstains from performing any act in his capacity as a public officer;

b. expedites, delays, hinders or prevents the performance of any act, whether by himself or by any other public officer, in his or that other public officer's capacity as a public officer; or

c. assists, favours, hinders or delays any person in the transaction of any business with a public body,

in order that a non-citizen investor or potential investor is coerced, compelled or induced to abandon his investment or, as the case may be, is prevented from proceeding with his initial investment, to the advantage of any other person is guilty of the offence of corruption in respect of foreign investment and shall be liable, on conviction, to a fine not exceeding thirty million leones or to imprisonment for a term not exceeding ten years or to both such fine and imprisonment.”

This provision seeks to deter public officials from hampering potential investors who are genuinely seeking to invest in Sierra Leone. If public officials unduly put obstacles in the way of foreign investors or refuse to perform or delay the performance of a particular act necessary for the foreign investor.

Company and Business registration processes and payment of taxes and duties must not be made unduly complex and cumbersome so as to entice foreign investors to go underground and pay bribes. The burden of bureaucracy and red-tape must not be deliberately put in the way of foreign investors to hamper their investment.

Corruption gives Sierra Leone a bad image and makes doing in business in Sierra Leone more expensive and risky. Corruption reduces foreign direct investment inflows and attracts lower quality of investment. Corruption deters foreign and domestic investment which we need so badly. It also undermines the ability of development partners to sustain their support for the country. It raises the cost of transactions by adding the cost of corruption and damages the country's business and investment climate by providing unfair competition. Economic growth is essential to reduce poverty however, corruption slows economic growth. Decreases in economic growth are associated with increases in corruption.

We must all join the fight against corruption by reporting acts of corruption. Foreign investors coming into Sierra Leone can report acts of corruption to the ACC confidentially. You can report corrupt practices to the Commission:

• In person at Cathedral House, 3 Gloucester Street, Freetown and 37 Kissy Town Road, Bo.
• By letter addressed to the Commission
• Telephone on 223645 or 333 (landline)
• Hotlines: 077 985 985 or 077 986 986
• Email – report@anticorruptionsl.org
• Internet on our website www.anticorruptionsl.org

Under section 6 of the Anti-Corruption Act, the Commission is mandated to provide every protection for the sources of its information.

Submitted on behalf of the ACC.