Daniel is Founder and CEO and has 20 years of experience in the international finance world focusing on cross-border payments, technology and the property sectors. Daniel is widely quoted as an expert within the money transfer industry including by The Economist, The Wall Street Journal, Reuters, CNBC and Bloomberg. Daniel is passionate about helping consumers and businesses find the best and most efficient ways to transfer money internationally.
Frequently asked questions
How we calculate the savings
Contents
Summary
Sierra Leone’s money transfer regulations
Sierra Leone’s monetary and regulatory authority
Sierra Leone’s economic background
Foreign investment in Sierra Leone
Currency
Summary
The official currency of Sierra Leone, the leone (SLL), has a floating exchange rate and is currently pegged to the US dollar (USD). Sierra Leone does not restrict overseas money transfers into or out of the country, but imposes minor administrative requirements on transfers over US$10,000.
Sierra Leone’s money transfer regulations
At this time, Sierra Leone does not impose restrictions on international money transfers or currency conversions that are associated with investments. This includes sending money or remittances of salary or other earnings, investment capital, lease payments, or payments for loans. Foreign investors and expatriate employees are guaranteed the right to repatriate earnings and the proceeds of sales of assets under Sierra Leone’s Investment Code.
Foreign investors are also permitted to withdraw funds from commercial banks and transfer money into any convertible currency at the legal market clearing rates. Because Sierra Leone’s financial infrastructure is not as well developed as most Western countries, it can be difficult to repatriate earnings or to send money abroad from a number of locations within the country. The first ATMs in Sierra Leone opened in 2011, and credit cards are not used within the country, due to poor internet connectivity and credit card fraud.
The Bank of Sierra Leone conducts frequent foreign exchange auctions to ensure foreign currencies are available to investors and non-residents living or working in the country. Bids are limited, however, to $100,000. Foreign exchange transactions can also be conducted through the country’s banking system, although banks will only provide cash to customers who already have cash deposited with the bank. Currently, Sierra Leone law requires any money transfer over $10,000 to be sent through the country’s banking system. This provides a paper trail of each transaction and helps to ensure transparency.
Sierra Leone’s monetary and regulatory authority
The central bank of Sierra Leone is the Bank of Sierra Leone (BSL). It is responsible for overseeing and regulating all currency exchange transactions for the leone, and setting banking regulations for the country. The Bank of Sierra Leone has set little to no restrictions on capital flows and fx payments into and out of the country, though it does require international money transfers to be sent through one of the country’s banks to establish a paper trail and ensure compliance with established regulations.
Sierra Leone’s economic background
Sierra Leone is located in West Africa on the Atlantic coast and is home to approximately six million people. It is a member of a number of African and global organizations, as well as several economic initiatives to help spur development and foreign direct investment. Sierra Leone offers duty-free access to large markets such as the United States and the European Union (EU) through treaties like the US African Growth and Opportunity Act (AGOA) and the EU Everything But Arms initiative. Most of Sierra Leone’s inhabitants live in extreme poverty, however, and the country is largely dependent on foreign aid, despite large deposits of iron ore and a variety of minerals.
Foreign investment in Sierra Leone
Sierra Leone’s membership in a number of global agreements and economic initiatives reflect the country’s efforts to attract more foreign direct investment. Currently, the country is a member of the Mano River Union (MRU), with Guinea, Liberia, and the Cote d’Ivoire, and the Economic Community of West African States (ECOWAS). Its treaties with the EU (Everything But Arms initiative) and the US (US African Growth and Opportunity Act), however, have alleviated the extreme poverty that persists in Sierra Leone. According to the US State Department, the country’s GDP in 2012 was US $3.8bn, and the World Bank estimated that the country’s gross national income (GNI) per capita in 2012 was only US $580. A GNI of US $580 indicates that over 72% of the population living on less than $1 per day.
There are, however, some bright spots for investors interested in the Sierra Leone. The government has stated that foreign direct investment is a priority for the country and investment in Sierra Leone is increasing. The government has shown some progress in reforming trade and investment policies to encourage the revitalization of the private sector.
Although the World Bank ranked Sierra Leone low in its 2015 Doing Business report, at number 140 out of 183 countries, the country ranks higher in the some of the report’s subcategories. It ranked 62nd globally in the category of protecting minority investors and 91st for ease of starting a business.
One of the biggest challenges for Sierra Leone has been recovering from a long civil war (1991-2002), and the constraints of poverty that affect many of the country’s citizens. The civil war focused international attention on Sierra Leone, and that attention led to considerable inflows of foreign aid. Although Sierra Leone is still largely dependent on aid, donors are beginning to reduce their contributions and the aid programs put in place after the war are transitioning and in some cases winding down. Today, private business and institutional government structures are beginning to develop, but most still remain in developmental phase and prone to mismanagement and corruption.
The 2014-2015 Ebola virus epidemic has had a significant impact on Sierra Leone’s economy, causing job losses and wage declines, particularly in urban areas. The actual proportion of the population infected by the virus has been relatively small, however, and job losses are mainly an indirect result of necessary preventative measures aimed at controlling the spread of the disease.
Although Sierra Leone has considerable wealth in its natural resources, it has not yet been able to successfully leverage these natural resources to increase production and improve the lives of its citizens. The country continues to be primarily agrarian, with a promising fishing sector and significant potential in its mining sector.
Currency
The leone is the official currency of Sierra Leone. It is divided into 100 cents and is available in coins worth 10, 50, 100, and 500 leones, and banknotes in denominations of 1000, 2000, 5000, and 10,000 leones.
