By Lawrence Williams
The International Monetary Fund (IMF) released a statement on 7 June expressing serious concerns about the independence of the Audit Service Sierra Leone (ASSL) after the fifth review of the Extended Credit Facility-financed programme was completed. To strengthen the ASSL’s institutional independence, additional reforms are needed, the Fund stated.
The IMF team applauded the ASSL for conducting a real-time audit on NaCOVERC during the early stages of the Covid-19 response. They described it as an internationally acclaimed practice that helped improve the overall national response.
The statement reads: “Going forward, it will be critical to implement the needed corrective actions and recommendations of existing audits, work towards strengthening the audit process and collaboration between ASSL and the Ministry of Finance and revisiting the Audit Service Act 2014 with respect to possible amendments to strengthen ASSL’s financial independence.”
In order to strike a balance between reducing debt vulnerabilities and post-crisis recovery, the team suggested that a fiscal framework should be developed. Their proposal was for the government to increase domestic revenue mobilization, secure more budget support grants, and strengthen expenditure management and commitment controls in order to achieve this goal.
The team said the medium-term economic outlook remains challenging since the competitive terms of trade have deteriorated largely due to the Covid pandemic and the Ukraine crisis. This, they added, could negatively impact development outcomes in the country.
Due to these global shocks, the report noted that earlier growth projections have been revised downward from 5.9 percent in July 2021 to 3.6 percent in May 2022.
However, the team expressed optimism that ECF funding of $20.8 million will be disbursed to the Government of Sierra Leone after approval from the IMF Executive Board.