National MSME Development Strategy

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What are the main aims and objectives?

The mandate for the strategy is to use existing key policies, laws, and regulations and formulate a National MSME Development Strategy that fits well within the current context of the MTI’s mission.

How does the program work?

The Government of Sierra Leone (GoSL), through its Ministry of Trade and Industry (MTI), invited IFC Advisory Services to assist in creating a national micro, small, and medium enterprise (MSME) development strategy to complement existing small and medium enterprise-friendly legislation and regulations.

The MTI’s vision for this strategy is to serve as a guide to the GoSL, donors, non-governmental organizations (NGOs), and private sector groups in providing support to MSMEs in a strategic manner.

Foreword from IFC, a member of the World Bank Group:

"NO BUSINESS IS TOO SMALL TO MATTER.
The vendor selling hot lunches, the taxi driver operating his own vehicle, the seamstress stitching with a single sewing machine. These entrepreneurs provide vital services to their communities, but more than that, most support children, parents, or grandparents, providing the money needed for clothing, food, transport, and other essentials.

Small and medium sized businesses also power the activities of larger firms. Where would a mining or telecommunications giant be without the cleaning, transport, and construction firms that smooth its daily operations and reliably feed its supply chains?

Despite their importance, however, small businesses in Sierra Leone continue to face daily challenges. For example, Sierra Leone’s business environment, though improving, remains difficult: business owners can face an array of legal obligations and unacceptable delays when hiring staff or seeking permits. Accessing finance and training can also
prove difficult in Sierra Leone, confining many small businesses to the informal sector, where they might survive, but not grow.

Sierra Leone’s central challenge is, therefore, not simply to spur the creation of more small businesses, but also to strengthen those that already exist, helping them increase production, and take on more clients and employees. By doing so, they will make greater contributions to the country’s overall economic growth.

This National MSME development strategy was created by Sierra Leone’s Ministry of Trade and Industry and is supported by IFC, a member of the World Bank Group. A direct response to entrepreneurs and business owners who have asked for more support, it is built on four pillars: improving the business enabling environment; promoting
linkages to help small firms win contracts with larger firms and the government; increasing access to finance; and widening access to skills training.

In the wake of the Ebola crisis, businesses in Sierra Leone have never before needed such a comprehensive strategy for growth. Small businesses especially must be at the very heart of any project that aims to strengthen the private sector, and create jobs and opportunity.

Thankfully, Sierra Leone is a resilient country. It has weathered setbacks and its population is determined to work hard and succeed. IFC will continue to be a strong partner with Sierra Leone, providing advice and helping entrepreneurs tap opportunities in the mining, agricultural, forestry, fishing, manufacturing, and tourism sectors, among others.

We at IFC believe that no business is too small to matter - and that no business is too small to grow."

Eligibility

SME Small and Medium Enterprise
SMT Sierra Leone Microfinance Trust
National micro, small, and medium enterprise

Timeline

For each of the five years from 2013 to 2018, the Implementation Plan will group specific activities under each of its objectives.

What lessons can be learned?

To avoid overlap in the delivery of this Strategy, close co-ordination among concerned stakeholders will be maintained by the SLIEPA. Each activity will be finalized with a corresponding:

  • Timeline and deadline for its implementation
  • The government institution accepting responsibility for implementing the activity
  • The expected result
  • The performance indicators pertaining to the activity
  • The estimated cost of implementing the activity
  • The potential source of funding (for example, government or donor funding).

All existing and known future donor interventions related to the small business sector will be identified and included within the activities of the Implementation Plan. Further, the activities of this Strategy will be grouped together and the responsibility for delivery on these activities will be systematically shared among donors and government agencies
to ensure efficiency. Agencies will be responsible for developing projects and programs for effective delivery on this Strategy.

A Strategy Working Group should be developed to formulate activities. Membership of the Strategy Working Group has been expanded to include representatives from relevant government institutions that accepted responsibility for implementing activities related to the Strategy’s goals and objectives. The MTI, through the SLIEPA, will supervise the
implementation of the Strategy, while government institutions will confirm acceptance for implementing of their particular activities, including the associated timelines.

Notes + Additional Context

The strategy was guided by:

  • The GoSL’s Poverty Reduction Strategy Paper – Agenda for Prosperity
  • The Enhanced Private Sector Program
  • The Private Sector Development Strategy
  • The Financial Sector Development Program of the Bank of Sierra Leone
  • Existing policies and legislation (including those in specific economic sectors) that favour MSME development, including:
    • The Business Start-up Act
    • The Registration of Business Act
    • The Companies Act
    • The Bankruptcy Act
    • The Payment Systems Act
    • The Goods and Services Tax Act
    • The Finance Act
    • The Local Content Policy
  • Specific initiatives that have been undertaken by the GoSL in the past three to eight years to support MSME development
  • Various types of initiatives undertaken by donors for MSME support or development in the past three to eight years
  • Specific initiatives by the GoSL and donors, and policies that promote women-owned enterprises
  • The World Bank’s Private Sector Development Strategy for Sierra Leone
  • The Joint Country Assistance Strategy developed by the World Bank, IFC, and the African Development Bank (AfDB)
  • Regional strategies proposed by regional economic and trade groups such as ECOWAS and the Mano River Union (MRU).

CURATED BY

Francis Stevens George

Managing Director
GEN Sierra Leone
Sierra Leone