Sierra Leone: Urban-elite bias, atrocity & debt

Abstract

Sierra Leone experienced the violent results of an undeclared civil war which lasted over a decade. The state had lost control of the country's hinterland! Maiming, killing, and destruction dominated this part of West Africa, and the violence largely resulted from a set of programmes and policies of the country's post-colonial government which produced pronounced and obscene elite-peasant disparities. With the termination of hostilities, the IMF and the World Bank have financially assisted the country's recovery and rehabilitation through a set of programmes. These were dominated by the IMF's Post-Conflict scheme and the jointly-administered (IMF/WB) Heavily Indebted Poor Countries (HIPC) initiative. This paper interrogates the documents of these International Financial Institutions (IFIs) and queries such data in two senses: a) has the nation's development agenda been able to recover from the debt overhang, and b) are the fundamental causes of the country's violent past addressed? The experience of Sierra Leone provides a window into the operations of the IFIs as they impose neoliberal globalisation in the third world.

Main article text

The strife of the civil war, generated by the Revolutionary United Front (RUF) which lasted from 1991 to 2002, devastated Sierra Leone. The result was that an entire generation of people in the nation knew only death, maiming, and destruction. The civil strife led to the spread of disease; caused food shortages; eliminated social services; wiped out the national economic system; destroyed the lives and livelihoods of individuals, families, and villages; and ruined the country's infrastructure. However, a formal peace was finally declared in January of 2002 and elections were held in the following May. Now, Sierra Leone has to rebuild itself, its economy, its people, its administration – everything has to be restored!

Previous research has investigated the war, its events, context, and causes (Abdullah, 1998; Abdullah and Muana, 1998; Bah, 2000; Bangura, 2000; Cline-Cole, 2003; Kandeh, 2002; Kpundeh, 1994; PAC, 2000a,b; Reno, 1995a,b, 1996, 1998b, 2000a; Richards, 1996; Riddell, 2005; Riley, 1996, Riley, 1997; Riley and Sesay, 1995; Sesay, 1995; Williams, 2001; Zack-Williams, 1992, 1997a,b, 1999, 2001; Zack-Williams and Riley, 1993). Their analyses have pointed to youth culture, foreign machinations, the lumpenproletariat, diamonds, economic decline, the collapsed state, corruption, poverty, misrule, patron-client relations, patrimonialism, the shadow state, kleptocracy, predation, privatisation, a security vacuum, the breakdown of the rule of law, ethnicity, social exclusion, foreign interference, greed, one-party rule, political violence, and inequality acting both in concert and singly. All of these factors in the country's political economy are vital to our understanding of the chaos and violence. However, they underlie the more structural factor, and the reason that the revolution lasted 11 years and involved millions of people – the exploitation of the countryside and the marked elite-peasant disparities.

The fundamental research question which provides the focus to the present analysis relates to two questions regarding the programmes and policies of the World Bank (WB) and International Monetary Fund (IMF) in the domestic hostility's aftermath. First, it inquires whether these programmes have been effective in alleviating the country of the burden of debt servicing, which has removed funds from other elements of the national budget and which has devastated the country and retarded its path of development? Secondly, the investigation also inquires as to the effectiveness of these IFIs in addressing the basic causes underlying Sierra Leone's recent decade of violence, chaos, and destruction.¹

The context is that the country is the poorest nation in the world. Sierra Leone ranks last on the United Nations Development Programme's Human Development Index (and has for a number of years), has the lowest purchasing power parity (PPP) according to the World Development Report for 2004, and has the fourth lowest per capita income in the world of only US$140 per annum. Its infant (under 5) mortality rate is 316/1000 (World Bank, 2004). Life Expectancy at birth is only 39 years (Ibid., 2003); and debt servicing reached 58.2 per cent of export revenue in 2000.

The country was blessed with great riches when it attained independence from British colonialism in 1961 with its vibrant population and their unique cultures; the tropical monsoon environment; and vast mineral resources of diamonds, bauxite, iron, and rutile. However, one of Sierra Leone's blessings – the rich diamond resource – was also its great curse.² The greatest difficulty resided in the resource's ‘lootability’ (Le Billon, 2003; Francis, 2001). Most diamonds can be recovered from stream beds (present & historical) with a minimum of equipment and infrastructure. They have been a great source of revenue – for example, in the 1960s the export of two million carats provided much of the government budget – and they could be easily transported and sold for cash or arms by merchants, criminals, warlords, and rebels.³

The diamond resources provided the fuel for the civil conflict; however, they were not its fundamental cause. The resource brought wealth to some people, was used to bribe and organise, and paid for the military hardware which was vital to the RUF. But, the cause of the strife resided elsewhere – in the millions of rural peasants and their disquiet. These were citizens of Sierra Leone who lived in the countryside. They were not just neglected, uninvolved, or would catch up later in the nation's development. They were actively exploited or ‘ripped off’, and had been for roughly a hundred years – first by colonialism and then by the policies, plans, and programmes of the government of independent Sierra Leone (Riddell, 2005). The result was that the people of the countryside lived in poverty; with little schooling or health care; disease was rampant, especially malaria and HIV/AIDS; jobs were few; and life expectancy was only about 30 years.

The ‘urban bias’ policies of the government of independent Sierra Leone, especially those of Siaka Stevens and his one-party All People's Congress (APC) regime relegated most of the country's rural citizens to the margins of betterment. The justification for these urban bias policies which favoured urban places (especially Freetown, the capital) in the minds of government personnel resided in several complementary factors. These included: a) the policies would help create a national ‘growth centre or pole’ which would stimulate the entire country's economic development and whose benefits would later ‘trickle down’ – although in the short-term it would result in having the nation's infrastructure and services concentrated in the major city; b) by the fear of making life difficult for the urban masses, who might riot about the exacting circumstances, and then perhaps overthrow the government; c) because of the legacy of colonialism, which preferred urban places as the centres of control; d) because of the history of wealthy countries whose economic growth was led by urban and industrial foci, or e) due to self-favouritism for investment in the city where the majority of the clients and elite resided (or their property and/or business did, though some were based in rural locales, especially most paramount chiefs).

The result of such urban bias in government plans, programmes, and policies was that they tended to favour not only urban places, but during the years of independence came to benefit an elite in government, business, bureaucracy, and military. The outcome was a transfer of state resources, not to national development, but to fostering elite privilege. It was reflected in extreme peasant disquiet, and a marked disparity between urban and rural lives. The mainly urban elite lived in relatively better conditions, with their large homes, educational opportunities, health care facilities, higher income, foreign trips, employment opportunities, and big cars.

Further, the rural disquiet was exacerbated by a pervasive youth-elder conflict (Abdullah and Muana, 1998; Archibald and Richards, 2002; Peters and Richards, 1998; Richards, 2001a), whereby youths were dominated by more mature, experienced, and powerful leaders in rural, traditional societies. This found political, social, and economic expression, but this was exacerbated by the frequent ‘woman damage’ fines of the legal system of the country's chiefdoms. The result was a mass of rural youth who felt abused, who saw no hope in the economic sphere which had few employment niches, whose cultural role was circumscribed, and who had little health care or schooling.⁴ This had been the case for years during colonial rule, but now it was caused by their fellow citizens and not the foreign power. The rural youth were joined in their disquiet by the thousands of unemployed and marginalised youth in urban places, most of whom had recently migrated from the countryside, and by thousands who were forcibly conscripted.

The cauldron of rural disquiet had been quietly boiling for over four generations, but it was diffused by the fact that this agitated mass was spread over thousands of chiefdoms, towns, and villages, and diffused over thousands of square kilometers. Then suddenly in the 1990s the RUF provided outlets for their vexation. There was a vent for their disquiet aimed at the government, the elite, and the elders; there were niches for youth (quasi-employment and often quasi-military rank); and there was a source of income in either looting or diamond mining.

Elsewhere in Africa the ability of the state to extract surplus from peasants had been gradually eroded and then eliminated by the structural adjustment programmes (SAPs) of the ‘Washington Consensus’ of the WB and IMF (Becker et al. 1994; Lofchie, 1997; Mkandawire, 2002; Riddell, 1997). This corrosion began in the 1980s with IMF loan programmes and attained prominence by the early 90s as the conditionalities of the SAPs of both the WB and IMF led to the incorporation of the third world into a globalised universe (Riddell, 2003a). However, in Sierra Leone the state was able to avoid the results of such programmes (or their impacts were ‘light’) because of the riches provided by diamond revenue (there were exports of two million carats in 1980s). Besides, the IFIs programmmes of the 1980s were all terminated (Weeks, 1992:32).

Meanwhile, the government's ‘urban bias’ policies, which were intended to stimulate development with the evolution of a national economic ‘growth pole’ to spur advancement, became a mechanism for the transfer of resources from rural peasants to the country's elite. In this process, what was in the public sphere (i.e. part of the government's budget) was converted into the private resource base of the elite of the country in a system of corruption, kleptocracy,⁵ patrimonial rule (Boas, 2001; Reno, 1995a), and patron-client relationships; this was the ‘heart of the matter’. The underlying resentment borne by the rural peasants was the reason that so many, especially the youth, sided with the RUF (Riddell, 2005).

Afterward, and as the chaos seemed to contract in its later years, the IFIs undertook major efforts in assisting the country on its path to recovery and resumed economic growth. These included the IMF's Post-Conflict Programme as well as the joint IFI programme, the Heavily Indebted Poor Countries (HIPC) Initiative. In essence these provided necessary financial assistance and direction in the country's recovery. However, there were major strings attached.

This concrete, empirical, case study of Sierra Leone's experience (as well as investigating the country's recovery process) provides a ‘window’ into the enigma which is the relationship between the programmes of the IFIs and the development experience of nations of the third world. The great ‘stumbling block’ in this quest has been the vast amount of rhetoric which surrounds such IFI intervention into poverty. The rhetoric talks of development, the removal of internal barriers to economic advance, and a globalising world where all components will benefit. However, the reality for poor nations is further poverty and destitution. The rhetoric-reality contrast is rendered most striking by the fact that such ‘bankspeak’ has a history which extends back over sixty years (Danaher, 1994).

This paper employs a combination of field experience, the documentation of the IFIs (including the programmes of the Sierra Leone government), African publications, the Sierra Leone web site, and the many books and journal which analyse violence in Sierra Leone in order to investigate the role of these IFIs in the restructuring of Sierra Leone following its decade of violent destruction. Vital to the paper's thesis, is the explanation of how such a policy framework was eliminated elsewhere on the continent, but could continue in Sierra Leone because of the riches provided by the diamond resource.⁶ The following section provides an explanation of how a peasant sense of injustice and unfairness developed with their exploitation by the state. This peasant disquiet was exacerbated by certain perverse tools.

Urban bias policies & programmes

Sierra Leone's chaos and violence were a result of the policies, programmes, and plans of the post-colonial governments of the country, especially those of the All People's Congress (APC) as led by Siaka Stevens and his chosen successor, Momoh⁷ (Riddell, 2005). In fact, Stevens' legacy of misrule stands beside the names of Foday Sankoh and Charles Taylor as the major villains in Sierra Leone's violence and chaos. It's no accident that Stevens departed in riches⁸ and his associates-clients lived in relative luxury. They had appropriated most government revenue to themselves and created a ‘Shadow State’ (Reno, 1995a, 2000b). In effect, most of the financial resources of the state were removed, and the resulting national poverty and state of underdevelopment exacerbated this rural vexation. During the four decades of Sierra Leone's independent existence the ‘growth pole’ developmental efforts of the government became translated into elite bias. The political and economic framework within which the Sierra Leone state operated provided the key for understanding rural disquiet. The country's independent years were dominated by the APC party, and the period was characterised by corruption, the end of democracy, one-party rule, a patrimonial regime, massive disparities in living conditions, the emergence of a shadow state, and an economic decline in the national economy. In marked contrast, it was also a time of prosperity for the clients of the shadow state.

The programmes and policies which were fundamental in this peasant-elite transfer are illustrated by the following measures which form a necessary preface to understanding the peasant disquiet which was evident in the 1970s and 1980s, and which ‘boiled over’ in the civil war of the 1990s (Riddell, 1985a, b, c; 2003b). As most peasant land could not be alienated, government policies were implemented:

• A monopoly produce marketing board (the SLPMB) which over its history paid farmers approximately 45% of world prices, while retaining the residual funds for operational expenses and a government budgetary surplus.

• Currency overvaluation, which leads to relatively cheaper imports (mainly urban) and more expensive exports (mainly rural cash crops).⁹

• Urban employment growth in bureaucracy or government parastatals.

• Reduced urban rice prices which, in effect, ‘subsidise’ urban dwellers and lower the incomes of rural producers.

• The taxing of international trade – so as to favour urban goods over rural cash crops.

• Investment in commercial agricultural development schemes which provide subsidies and positions to favoured people/areas.

• Urban industrial protection with tariffs, duties, and regulation.

• Locating most social services and utilities (health care, education, clean water, electricity, and paved roads) in urban places.

• The selling of import licences and foreign exchange allocations.

• Individualising (from communal) land tenure and thus removing peasant access to land.

• National spending with an urban bias.

• Capital Flight – movement of money abroad by many, especially the elite.

• Hosting of the meetings of the OAU in 1980 – with benefits (especially housing and cars) extended to this elite.

• National Development Plan (1970s) – with its urban and elite bias.

• Foreign aid projects, with the major benefits accruing to government clients because of state manipulation.

• Minimum wage legislation, favouring urban workers.

The result of all of these measures was peasant disquiet. Most rural dwellers felt exploited; they viewed the state as the enemy to be avoided. Resources weren't being withdrawn from the rural countryside for national development. Rather, they were being used to support the extravagant lifestyles of the country's corrupt elite. Further, peasants were very aware of the distinction; after all communications and circular migration between urban and rural locations overcame the constant government rhetoric which defended and ‘explained’ their actions. This rural disquiet was exacerbated by the elder-youth division, accompanied by the intrusion of market forces (with local priorities being determined for peasant societies elsewhere),¹⁰ the lack of rural employment opportunities for youth, and by the collapse of the ‘moral economy’ which cemented rural society (Scott, 1976).

The cause of the civil war, the strife, the violence, the chaos, and the destruction reside in the rural-elite distinction. Its source was not in ethnic grievance. Nor did it reflect charismatic leadership from the RUF. Nor did these rebels ever pose as an alternative government. The perturbation reflected plunder of the countryside's people and resources, and this fleecing had an historical legacy – in independence, especially throughout the 1970s and 1980s, their own government was exploiting peasants in a fashion similar to the colonial past. The country wasn't led by a state whose goal was national betterment, economic development, and national cohesion. The elite leading this state in government, administration, armed forces, and business was self-serving; they took possession of what belonged to the nation-state as their own in effect, privatizing what was public.¹¹ Sierra Leone's government was preempted by a shadow state, in which private interests, corruption, and patron-client relations prevailed (Reno, 1995a).

The reshaping of Sierra Leone's landscape: its political economy

The landscape of the country is the reflection of the interaction of people, along with their cultural base, and the natural environment, with its resource endowment. From 1896, when the British declared Sierra Leone to be a Colony (1807) and Protectorate, this interaction was strongly influenced and shaped by the colonial context within which it was set. During the years of British domination a structure of network and hierarchy was imposed by them (Riddell, 1970) In effect, the landscape was reshaped in order to serve the interests of the ‘mother’ country, with its focus on mineral resources and agricultural cash crops from the country's rural hinterland.¹² Then in 1961, Sierra Leone became an independent nation and its landscape was gradually remoulded by the plans, policies, and programmes of the new state and its leaders (Carney, 1962).

From the late 1970s, due to the rising cost of imports, especially oil, the country's finances became so out of kilter (in deficit) that, like the other nations of tropical Africa, it became reliant on loans from the IFIs. This was first expressed in the 1967 intervention of the IMF (Weeks, 1992:32); however, the external influence through borrowing and loans became pronounced in Sierra Leone by the late 1970s. In fact, the country's five-year development plan (1974/5–1978/9) had to be abandoned because of financial constraint (Riddell, 1985a). Debt servicing not only became a major budget item for Sierra Leone and for the nations of the region, but these loans from the IFIs came with a set of conditions attached to them (Riddell, 1992). These ‘conditionalities’ were economic in nature, later to be described as the Washington Consensus, impacting on people's lives and the landscapes they inhabited (Fine et al. 2001; Hoogvelt, 1987). These were expressed in poverty, a reduced role of the state, capital flight, unemployment, and economic depression.

However, within Sierra Leone such financial hardships were in large part offset by the revenue gained by the government through the taxation of diamond production. Because the country had access to this revenue, it could largely ignore the loans of the IFIs, with their neoliberal conditionalities attached – in fact, the three IMF programmes of the 1980s were all cancelled, and Sierra Leone was declared to be ineligible for IMF loans in 1988. In other words, the government of the country was able to continue to pursue the policies of the shadow state, especially its urban-elite bias policies. In effect, the state could continue to exploit the peasantry. The result was disquiet in the countryside where services were either poor or nonexistent, where jobs were few, where health was difficult, and where life expectancy was only about 30 years. This irritation was intensified for these peasants could see the rewards of their labour, not improving their conditions, but making the lives of the elite so much better. This is why so many young rural dwellers joined the RUF!

The country's chaos lasted for over a decade, from 1991 to 2002. National recovery was focused upon rehabilitation, peace, and security. These were translated into the specific goals of resettling people, rehabilitating infrastructure, resuming economic growth, balancing the national budget, and normalising relations with external creditors (SL-LoI, 1999, 2000). As well as the IFI's activities, there were at least 60 aid agencies and NGOs active in the country – at an enormous cost, with annual estimates of $16B for the UN agencies and $100m for the UK government (Baker and May, 2003:3).

Phase I in restructuring: the IMF's post-conflict programme

The violence that clouded Sierra Leone for over a decade began to decline at the turn of the millennium, and a formal peace was officially declared in January of 2002, with national elections held four months later. The rural citizens of Sierra Leone were faced with a lack of leadership in their quest for recovery. Certainly this direction wasn't to be found in the country's state which had exploited them for over four decades, and it wasn't emanating from their ‘natural leaders’, the chiefs, for they represented the interests of the elders and the better-off of the chiefdom, not the young peasants.

Instead of this local leadership, Sierra Leone's path to recovery during this period was assisted and directed by the IFIs. First, in the 1998–2000 period the IMF implemented their Post-Conflict programme (SL-LoI, 1999, 2000; IMF, 1998, 1999).¹³ Under such a programme, Sierra Leone was provided with US$50.7 milllion, a substantial sum to aid in their recovery. The funds were certainly vital, in that the country was trapped in a vicious cycle of conflict, low growth, and poverty. The funds were earmarked for the vast project of resettling people and rehabilitating the national infrastructure; as well, the country's administrative and institutional capacity were to be rebuilt.

However, the funds represented a mixed blessing. Not only were they vital in breaking out of this circular and causative underdevelopment syndrome, but this post-conflict programme provided an avenue to enter directly into the HIPC initiative without having the usual necessary ‘track record’. But at the same time, the monies were not a helpful grant; they represented a loan which had to be repaid, and the funds were loaned at commercial or non-concessional rates. The basic neoliberal agenda of assistance, with a debt burden, was evident in the initiative.

Meanwhile, the WB was also quite active in Sierra Leone's recovery on two fronts. It has acted as an influential promoter of investment by others (WBA 2001) as the country began its initial phase of recovery under its Disarmament, Demobilization and Reintegration (DDR) Programme and as it moved toward the implementation of a formal HIPC. Secondly, the WB instituted several projects which were key components in the country's recovery efforts. For example, over the 2000–4 period a total of US$238.62 million was loaned to the country for its HIV/AIDS crisis, economic recovery, administrative restructuring, social action, privatisation, institutional reform, and the rehabilitation of its education and health sectors (ten specific projects: WB, 2000a, b; 2001a, b; 2003a, b, c, d, e; 2004a).

However, the actions of the Bank and the Fund present an enigma. On the one hand, their financial support has been necessary for national recovery, and their solicitation efforts have been most helpful in increasing external assistance to the country. However, the monies are to be paid back (even if heavily reduced under the HIPC Initiative); they are loans and not gifts. The Bank would rightly defend itself by indicating that it is not fully an aid agency and that its hands are tied because it is an international bank which must remain solvent. However, Sierra Leone is poor and devastated – as is the entire third world – and their poverty cannot be divorced from the international system, which urgently needs an effective and financially sound development agency.

Phase II in restructuring: the IFI's HIPC programme

The IMF's post-conflict programme led directly into the HIPC Initiative jointly devised by the IMF and the WB (SL-LoI, 2002a, b: 2003; IMF, 2001a,b; 2002a, ;2003a, b; IDA, 2001a; 2002a, b, 2003). The programme is intended to address the massive problem of ‘debt overhang’ in the poorest countries of the TW (Ames et al. 2002; Birdsall and Williamson, 2002; Booth, 2003; Craig and Porter, 2003; Culpeper & Serieux, 2001; Gautam, 2003; Gunter, 2002; Killick, 2004; Mutume, 2002; Serieux, 2001a,b; Waites, 2002), and can be viewed as a neoliberal response to the massive NGO effort, led by Jubilee2000, to eliminate the third world's debt crisis.¹⁴ The Initiative is intended to provide relief from the heavy financial burden of servicing debt, with the released monies being directed toward poverty reduction and the provision of services. Its objectives are to assist countries to attain sustainable growth, reach a balanced national budget, and normalise creditor arrangements. The programme was intended to incorporate the voices of the poor, as well as to lead to further global integration (Craig and Porter, 2003). Each HIPC country is to develop a Poverty Reduction Strategy Paper (PRSP), which is to be a ‘national development plan’ addressing poverty, especially health care and education.

The third world countries' financial difficulties largely resulted from the massive sums required annually to service their debts (current details of the HIPC Initiative can be found at their website). This meant that monies were removed from the national budget, especially from health care and education, in order to pay off the interest and principal of these past loans. This reimbursement was only the ‘tip of the iceberg’ for the opportunity cost of debt servicing reached into every aspect of national poverty, to the food that couldn't be imported, the roads that were not repaired, the national security that disappeared, and the transport vehicles that weren't maintained.¹⁵

The HIPC Initiative addressed problems associated with such debt, but it did not speak to the causes of that debt. In other words, the HIPC is but a temporary solution to the debt crisis in that it applies to today's loans, but not to those to be amassed in the future – and for the country to experience development, or any change, does require funds. This money must come via foreign loans, as there is not a chance of such a poor nation saving sufficient capital to overcome its poverty. However, the HIPC Initiative is Sierra Leone's best and only choice in defining its path into the future.

Sierra Leone's HIPC was prefaced by an interim plan (I-HIPC) which provided a ‘road map’ for the more formal programme to follow (GSL, 2001; IDA, 2001b; SL-LoI, 2001; IMF, 2003b; IDA, 2003). This 2001 paper was followed in a few months by a full-scale HIPC to extend from September of 2001 to April of 2003 and the country was indicated to have reached the ‘decision’ point in March, 2002, at which time it formally entered into the programme and obtained interim debt relief from the WB/ IMF (IDA, 2002a).¹⁶ However, because of the strife only a ‘transitional phase’ of the IPRSP was implemented, with a focus upon demobilisation and reintegration of ex-combatants and child soldiers (Murphy, 2003; Zack-Williams, 2001).

An integral component following from it was to be a Poverty Reduction Strategy Paper (PRSP) which was to act as a plan or blueprint for the Sierra Leone government as it sought for recovery and eventual development. This PRSP was to be produced by the government of Sierra Leone, having consulted with a representative civil society in its preparation. As well, under the initiative Sierra Leone was made eligible for concessional loans from the IFIs (the WB's International Development Association (IDA) facility and the IMF's Poverty Reduction and Growth Facility (PRGF) programme).

However, the major objective of the HIPC, which was part of the new and evolving ‘post-Washington Consensus’ of the IFIs was to reduce the burden of debt servicing, making it ‘sustainable’, and to have the funds thereby released employed towards addressing poverty, providing services, and meeting the development agenda of the country.¹⁷ It was to be made much more effective than previous efforts by incorporating elements which enhanced its local influence – ‘consultation’ and ‘ownership’. However, although this document detailed the future development agenda of Sierra Leone, given the fact that the plan had to meet the approval of the IFIs, it was evident that the document was written in Washington by the IFIs or in Freetown by their local mission, and the origin was also indicated by the language, spelling, and punctuation of the instrument. The ‘bottom line’ is that the HIPC is surrounded by a rhetoric of consultation and local ownership; yet, the reality was that the document emanated from the IFIs (Mutume, 2002). As well there is a temporal delay in the Sierra Leone case, in that the document which was to be completed by June of 2003 has been delayed (currently expected in mid-2004 (IMF, 2003b 2004; IDA, 2003)).

In one sense, the preliminary HIPC document appears quite positive as it addressed the basic difficulties facing the country (security, extreme poverty, war recovery, health & education, debt overhang, relations with lenders, macroeconomic stability & growth, privatisation, inflation, and efficient administration). However, the scheme was underlined with a sense of unreality as it was founded upon an economic growth rate of 6–7 per cent (SL-LoI 2003).¹⁸ The fancifulness is furthered when it is considered that projections of the initiative were based on a quite unrealistic scenario that no further debt would be encumbered in the development quest.¹⁹

The HIPC initiative will provide some US$600 million in debt relief to Sierra Leone, representing 80 per cent of the Net Present Value (NPV) of the country's outstanding debt burden. The relief is, without doubt, substantial. As a recent IMF Survey (2003 supplement, 21) indicates:

The Initiative has lowered the average ratio of debt service to exports for the 27 decision-point countries from 16 percent in 1998 to about 9.9 per cent in 2002.

However, the Initiative is open to abundant critical comment. Most fundamental is that, despite a vocabulary of debt relief and recovery, the same neoliberal framework as occurred with SAPs in the past continues, and the global framework within which Sierra Leone's development is framed remains unchanged. The rhetoric of ‘the post-Washington Consensus’ and ‘the Enhanced HIPC initiative’ mask the fact that the neoliberal framework remains and SAPs continue, but now they are surrounded with a soothing vocabulary which makes them sound quite enlightened.²⁰ Basic to any discussion of the HIPC initiative is that despite the pleading of Jubilee2000 for debt removal, the HIPC programme does not eliminate future debt (except briefly when countries reach the ‘completion-point’). Rather, the intention of the programme is to reduce such debt to ‘sustainable’ levels, while also imposing a set of conditionalities quite similar to what was known as ‘the Washington Consensus’. The HIPC Initiatives thus can be viewed as being necessary, but not sufficient to remove poverty. The programmes help relieve the debt burden in the short term, but lead to no long term recovery.²¹

As well, the initiative did little to alter the ‘external’ or global constraints on development faced by Sierra Leone. Betterment and economic growth in the third world are related to trade advances and foreign aid. However, export markets for most third world products continue to remain blocked, competing goods from the First World remain heavily subsidised, the terms of trade facing TW commerce continue to turn against the Southern nations. In addition, there is a great fear that Northern nations will consider the HIPC initiative as a substitute for traditional bilateral aid, and thus reduce it accordingly. Further, the scheme did nothing to reduce third world susceptibility to ‘external shocks’, such as weather and global market prices. Besides, many of the so-called forgiven debts never would have been paid back, or they are currently available for purchase at much reduced rates in the world financial marketplace.²² Finally, the scheme talks about further debt reduction which countries will obtain at their ‘completion point’; however, after several years, this future bonus remains undefined and unclear.

The impact of the HIPC Initiative is highly contentious. In a positive sense, its supporters view such a programme as a positive venture, pointing out certain temporary flaws in its operation, and blaming its shortcomings on recipient countries and their failure to act correctly. Above all, major debt relief is provided and the financial constraint is relieved. On the other hand, the critics of these neoliberal debt relief programmes see them as mere window dressing. The focus on poverty and the suggestion of novelty are simply masking the fact that the HIPC Initiative is really the former ‘Washington Consensus’, but now with a bit of makeup to make it appear novel. The IFIs stresses macroeconomic theory in its neoliberal form, while the critics tend to comment based upon the empirical experience of poor third world nations.²³

Despite the vast publicity given to the HIPC initiative, underdevelopment in the TW continues and poverty mounts. The financial support from the IFIs is a mixed blessing. On a positive note, the funds enhance the state structure of poor nations in the programme, overcoming the problem of state weakness and allowing such countries to more ably deal with service provision. On the other hand though, HIPC recipients will employ the debt relief dividend to superficially address poverty and service provision for only the near future. However, as well as not addressing the issue of debt relief over time, the Initiative seemingly ignores many of the fundamental causes of third world poverty and underdevelopment, such as:

• •

  transfer pricing of Multinational Corporations (MNCs)

• •

  human capital migration (‘brain drain’)

• •

  monetary export (‘capital flight’)

• •

  tariff barriers

• •

  subsidised competition and blocked markets (especially agriculture in Europe and US)

• •

  terms-of-trade

• •

  currency devaluation

• •

  disease (especially HIV/AIDS)

• •

  environment

• •

  gender

Basically, many of these items (1–7) relate to what may be termed the ‘external’ setting of poor third world countries. All are vital in the quest for national economic growth and development, and until they are meaningfully addressed (i.e. just not with empty pious-sounding words²⁴) most of humanity will continue to reside in poverty. For example, a major component of third world exports is in terms of agricultural products, and yet these poor nations are unable to compete in a ‘level’ global trading system because of First World countries providing massive subsidies to their agricultural sectors. Until these constraints are addressed there can be no meaningful development and no economic advance in the third world.

Others have written about the devastating effects of adjustment programmes on disease and the environment, and the increased burden on females is evident (Riddell, 2003c and the references therein). However, a basic element disregarded by the HIPC Initiative and one which exacerbates the underdevelopment of the third world is the constant devaluation of the currency of poor countries. This has a profound effect on the greatly reduced purchasing power of consumers and is a vital, though unspoken, key to the understanding of third world poverty and underdevelopment. For example, Sierra Leone's currency devaluation from US$1.4=1.0 Leones in 1967 to US$1.0=2562.0 Leones at the end of 2003 is an index of the marked decline in the purchasing power of the country's citizens.²⁵

Conclusion: the lessons of the case

In this article, comment is based upon the empirical experience of Sierra Leone which is somewhat unique in the third world in terms of its history, the environmental setting the experience of Creole settlement, the resource base of diamonds, and its civil war. As well, its post-independence government has been highly corrupt, based upon a state in which patronage-client relations dominated. In the 1970s and 1980s this became a private shadow state of the president and his entourage (Reno, 1995a).

At the outset, the concerns of this analysis focused upon the HIPC Initiative and its ability to address the causes of poverty in this country specifically and in the third world in general, and to address the fundamental causes of Sierra Leone's violence. The initial concern is answered with a resounding NO. The debt burden of this poor country is huge (US$288m on June 2003; SL-LoI, 2004), the nation continues to import food, and most people live in extreme poverty. Secondly, the prognosis for Sierra Leone's recovery from over a decade of chaos is a weak one because the fundamental causes of the country's collapse remain. The major element of this resides in peasant disquiet, especially as it exists among the youth. The HIPC Initiative has simply not addressed these urban-rural and youth-elder concerns, and unemployment (especially among youth in the countryside), remains at crisis levels (IMF, 2004). The effect is exacerbated by with the paucity of social services, such as clean water, proper schooling, and meaningful health care.²⁶ However, the many projects, bureaus, projects, and privatisations present yet further opportunities for a continuation of patronage politics. The problems of the past, extreme poverty and the constant threat of a return to violence, continue!

As well, the context of Sierra Leone's setting is foreboding. The entire region of the western part of West Africa continues to experience rebels, warlords, and violence (PAC, 2003b). For example, rebel activity is intense in neighbouring countries. This is especially bothersome in not only the historical sense that the initial RUF activity in Sierra Leone was the result of a ‘spillover’ from Liberia, and that the Liberian leader, Charles Taylor, stimulated the violence in Sierra Leone with his guns-for-diamonds exchanges, but also several of the former RUF leaders are in unknown locations within the subregion, and tens of thousands of refugees escaping from violence in Liberia have entered Sierra Leone and add to local turmoil.

Also of concern is that within Sierra Leone there is the lack of a sense of national integration – a feeling or rational in which all of the people of Sierra Leone see themselves as citizens of the nation-state first, members of its several ethnic components second, and loyal to a chiefdom and settlement third. The sad fact of the history of Sierra Leone is that over the last half-century of independence, government has not acted as a leader in the quest for economic growth, betterment, and national cohesion. Rather, the leadership of the state has been seen as an avenue to personal wealth. Yet, such nation building is an integral aspect of development, as all citizens need to feel themselves part of the nation-state and act accordingly in order to attain betterment. Such is a necessary condition for development. When a sector of the population considers the leaders of the state too corrupt and inept they may ‘exit’ from the nation-state into the informal economy in the city or subsistence production in the countryside (Hyden, 1980). The face of the development coin is economic betterment, but the obverse of the same coin is the tying together of all of its citizens, as they work toward a national goal. The economic and the political cannot be separated!

Even after more than a decade of violence and chaos, corruption, predatory behaviour (Nafziger and Auvinen, 2003; Sandbrook, 2000), ethnic rivalry, and patronage politics continue to characterize the national government. For example, a recent article in the Guardian Weekly on Sierra Leone indicates: ‘Corruption is still stronger than the law in the country’ (anonymous, 2002). Reporting on the Sierra Leone People's Party's (SLPP) landslide victory in the 2002 elections, Kandeh (2003, abst.) writes:

The SLPP, however, can ill afford to bask in electoral triumph or ignore the festering problems of rampant official corruption and mass poverty that led to the armed conflict in the 1990s. ²⁷

He further terms (2003, abst.) the SLPP as a ‘… patronage outfit, that is unresponsive to popular currents and mass aspirations.’²⁸ The problem of corruption is so evident that it was indicated in the recent correspondence between the Sierra Leone Government and the IMF (SL-LoI, 2004). Baker and May's recent investigation (2003:10) led them to conclude that corruption and clientelism continue with the new government; they cite a speech by Clare Short, former UK International Development Secretary, in which she said: ‘Personal gain, or loyalty to family, tribe or party, is put before national interest.’ The so-called democratic elections of the past half-century and the numerous coups hardly provided clean, efficient, developmental states. Making the government even more inept in the national developmental quest was the fact that a major portion of the nation's wealth is extracted by a business community which is largely non-Sierra Leonean (mainly from Lebanon or the Middle East) (PAC, 2003a). Also, the 12,000 UN troops are due to leave at the end of 2004, and the HIPC's ‘completion point’ with further debt relief appears to be a distant goal. Meanwhile, peasant disquiet, poverty, patronage, corruption, youth displeasure, the lack of jobs, and inequality remain.

Urban bias has now become a historical relic. However, patronage continues in the shadow state, privatisation, and the numerous recovery/development organisations. One need only read the interviews in Peters and Richards (1998) or the investigation conducted in a rural area of the country by Archibald and Richards (2002). As Lewis suggests (1996:123) ‘…traditional politics will be resurrected under new auspices.’

This political difficulty (corruption and neo-patrimonialism) is not simply a complicating issue in the implementation of PRSPs, developed within a neoliberal economic framework by the IFIs (Abrahamsen, 2004). Their belief in the separateness of the economic and political spheres means that their programmes do not address the fundamental inseparability of these domains.²⁹ In reality, however, the political defines how the economic operates. This is curious in that such cohesion is well known in the literature, and is even apparent from the media. Yet the HIPC Initiative is applied as if macroeconomics is the main factor in poverty alleviation, with politics of only an incidental concern; it certainly is a necessary condition, but it is hardly sufficient! For example in Sierra Leone the major economic engine of the country's development -diamonds – is not controlled by the political system.

Acknowledgements

The writer wishes to formally recognise the insights gained from the research represented by the literature cited below. Various component parts of this paper were presented to the annual meetings of the Canadian Association for the Study of International Development, the Review of African Political Economy, and the African Studies Association. The author wishes to thank the members of the respective panels for their thoughtful comments. In addition, the comments of Allen Howard on a preliminary draught were most helpful.’

Notes

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Periodicals & Annual

World Bank (annual) World Development Report; West Africa; Africa Confidential; Africa Recovery; New Internationalist; Finance & Development; IMF Survey; Guardian Weekly.

Newspaper accounts

Anonymous (2002), ‘Bribery Keeps Stranglehold on Sierra Leone’, Guardian Weekly (October 24–30, 3). Charlotte Denny (2003), ‘Hypocrisy that underlines the HIPC: The debt-relief generosity of several large creditor countries has been betrayed’, Guardian Weekly (January 23–29).

Websites

Information on Sierra Leone, including current news, important documents, items of special, interest, news & information archives, and much more, can be found at the country website: (www.sierra-leone.org).

The following documents are available at the Partnership Africa Canada website: (www.partnershipafricacanada.org).

Partnership Africa Canada (PAC, 2000a), The Heart of the Matter: Sierra Leone, diamonds and human security; (2000b), Sierra Leone one year after the peace accord: the search for peace, justice and sustainable development; (2003a), PAC Presentation to the Sierra Leone Truth and Reconciliation Commission (by Lansana Gberie); (2003b), Rebel Leaders Death Should Not Detract from Special Court's Mission.

The Heavily Indebted Poor Countries (HIPC) Initiative maintains a website with current information: (www.worldbank.org/hipc/).

The following documents, including Letters of Intent from the Sierra Leone government, are available at the IMF-Sierra Leone website: (www.imf.org/external/SLE/index.htm).

(IMF, 1998), Press Release 98/55 (9 November 1998) ‘IMF Approves Emergency Post Conflict Assistance’; (1999), Press Release 99/62 (17 December 1999), ‘IMF Approves $US21m in Emergency Post Conflict Assistance to Sierra Leone’;(2001a), Public Information Notice 01/12 (12 February 2001), ‘IMF Concludes Article IV Consultations with Sierra Leone’; (2001b), (20 September 2001), ‘IMF approves in principle US$169m 3yr PRGF Arrangement for Sierra Leone’; (2002a), News Brief (12 March 2002), ‘IMF Completes Review under Sierra Leone's PRGF Arrangement and Approves US$12m Disbursement’;

(2002b), News Brief (19 September 2002), ‘IMF completes review under Sierra Leone's PRGF arrangement and approves US$25m Disbursement’; (2003a), Press Release 03/56 (21 April 2003), ‘IMF Completes Review under Sierra Leone's PRGF Arrangement and Approves US$19m Disbursement’; (2003b), Country Report No. 03/182 (June 2003), ‘Sierra Leone: Poverty Reduction Strategy Paper preparation status report’; (2004), Country Report 04/49 (March 2004) ‘Fourth Review under the 3-yr Arrangement under the PRGF Press Release, SL Statement’.

Letters of Intent

(SL-LoI 1999, 2000) (from Government of Sierra Leone to the IMF); (SL-LoI 2001) (from Government of Sierra Leone to the IMF), ’Memorandum of Economic, Financial Policies, Technical Memorandum of Understanding’. (SL-LoI 2002a) (from Government of Sierra Leone to the IMF); (SL-LoI 2002b) (from Government of Sierra Leone to the IMF), ‘Memorandum of Economic and Financial Policies’; (SL-LoI 2003) (from Government of Sierra Leone to the IMF), ‘Memorandum of Economic and Financial Policies, and Technical Memorandum of Understanding’; (SL-LoI 2004) (from Government of Sierra Leone to the IMF), ‘Memorandum of Economic and Financial Policies’.

World Bank (WBA 2001) World Bank News Release 2001/372/AFR ‘Sierra Leone Multi-Donor Trust Fund: Donors support for disarmament, demobilization, reintegration’.

Government of Sierra Leone (GSL 2001) (30 June 2001),’ Interim Poverty Reduction Strategy Paper (I-PRSP)’.

IDA, IMF and Sierra Leone (IDA 2001a) (12 July 2001), ‘Preliminary Document, IMF, International Development Association, Sierra Leone – Enhanced HIPC’.

IDA and IMF (IDA 2001b) (16 July 2001), ‘Joint Staff Assessment and the Interim Poverty Reduction Strategy Paper’.

IDA and IMF (IDA 2002a) (15 February 2002), ‘Sierra Leone Enhanced Heavily Indebted Poor Countries (HIPC) Initiative Decision Point Document’.

IDA and IMF (IDA 2002b) (19 March 2002), ‘Press Release: IMF, WB Support US$950m in debt service relief for Sierra Leone Under Enhanced HIPC Initiative’.

IDA and IMF (IDA 2003), IMF Country Report No. 03/183 (June 2003) ‘Sierra Leone: Joint assessment of the Poverty Reduction Strategy Paper preparation status report’.

The following documents are available at the World Bank website: (www.worldbank.org)

WB, 2000a, ‘Economic Rehabilitation + Recovery Project’; WB 2000b, ‘Economic Rehabilitation + Recovery Project Supplemental Credit’; WB, 2001a, ‘Public Sector Management Support Project (02)’; WB, 2001b, ‘Economic Rehabilitation and Recovery Project (02)’; WB, 2003a, ‘HIV/AIDS Response Project’; WB, 2003b, ‘Rehabilitation of Basic Education’; WB, 2003c, ‘Health Sector Reconstruction’; WB, 2003d, ‘National Social Action Project’; WB, 2003e, ‘Advance Reform, Increase of Private Sector’; WB, 2004a, ‘Institutional Reform and Capacity Building’.

Footnotes

1. It is recognised that IFIs are not the only actors, though they are the focus here. Others include theWTO, UN agencies, regional development banks, trade agreements, post-colonial links, and Multinational Corporations.

2. Such resources have had negative consequences throughout the African continent, acting both asa blessing by providing a revenue source, but also as a curse being associated with environmental destruction, corruption, rent-seeking, or civil strife (examples being the civil wars in Angola and Sudan and the destruction to the environment and livelihoods of Nigerian Niger delta region). Indications of the role of diamonds in Sierra Leone's violence and chaos can be found in Campbell (2002), Francis (2001:123–146), Hirsch (2001), and Richards (2001b).

3. For example, Reno indicated that tax revenue provided by the export of alluvial diamondsprovided over US$200m in 1968. By 1987 this had declined to US$0.1m (1998a:116). However, with the end of strife there has been the beginnings of a recovery with a legal export of $41m (out of an estimated export of $330m) (Sierra Leone website, current news, 28 August 2003).

4. For example, imagine the disquiet raised among the rural youth when the governmentemployed the army in 1989 to remove illegal miners from the diamond areas (Reno 1998a:120) [read: Momoh's (Stevens' successor) APC government in effect removed the major job source for rural youth].

5. The country is permeated by corruption; however, great care must be used in its explanation.That Stevens had amassed an estimated $1.5bn when he retired from Sierra Leone politics is one suggestive index of his predatory rule (Griffiths, 2003). So to is the role of Lebanese entrepreneurs in society. So too are diamonds, poverty, the colonial legacy, and disparities in income within and between countries.

6. SAPs certainly had devastating effects. This could be seen in currency devaluation, privatisation,unemployment, trade liberalisation, the removal of state influence, and the ending of various subsidies (Riddell, 1992).

7. The one-party state began de facto for most of the 1970s. However, in a formal sense it beganin 1978, and the transfer to Momoh was in 1985.

8. Reputed to be $1.5bn (Griffiths, 2003)

9. For a clear layperson's explanation of the effects of overvalued currency refer to Griffiths (2003:29–31).

10. The essence of Griffiths' argument (2003) is that the World Bank's insistence on having a ‘free market’ allocate imported rice would lead to dire consequences. This is formally expressed in his Cabinet Paper (2003:207–12) and his concern was expressed as (194): ‘ … there will be food riots, people starving in the street, and a coup’. The empirical details differed, except for the coup, but an uprising certainly occurred.

11. This thesis of peasant disquiet is in marked contrast to the thesis posited by Mkandawire (2002) on the role and importance of urban places in African rebel movements. This is not to denigrate Mkandawire's analysis, especially his depiction of neopatrimonialism. However, not all African rebellions have urban roots.

12. This was expressed in the two initial forms of British colonialism: Freetown and itspeninsula=colony; the rural provinces=protectorate. It was also found in the social distinction of Krio-Upcountry.

13. The conflict being addressed by this IMF programme has unfortunately become increasinglycommon throughout the third world. In fact, the IMF programme now includes eleven countries and the WB's encompasses 36 countries; poverty is a common element in all of them. The implicit message is that poverty begets, or conditions, violence. Lest this programme be viewed as a general path leading to HIPC debt relief for all countries in the programme, it should be noted that several conflict-affected counties have been denied debt relief due to previous debt and its lack of servicing.

14. To qualify for the HIPC Initiative, countries are expected to have a debt-to-export ratioexceeding 150% and a debt-to-fiscal revenue ratio greater than 250% (both in NPV terms).

15. This underlies all of the airplane, railroad, ferry and road disasters that are becoming commonevents throughout the third world. In poverty, maintenance suffers.

16. This was conditional on continuing peace, and that Sierra Leone continues to follow its IDA andPRGF programmes. However, because of difficulties (delays in disarmament, the elections, and problems in finance and administration) the original ‘completion point’ which was to be reached in December 2002 was pushed back to December 2003 (IDA, 2003; IMF, 2003b) and again to mid2004 (IMF, 2004).

17. As the HIPC Fact sheet phrases it: ‘It aims to ensure that no poor country faces a debt burdenit cannot manage.’

18. Based upon overall economic recovery and increased export revenue derived from diamonds,rutile, bauxite, and agricultural cash crops. Privatisation had begun much earlier, but with accompanying patronage (Nafziger and Auvinen, 2002).

19. There is a curious confusion in the HIPC documents. Although an IMF document (IMF,2001b) indicates formal approval of the Initiative, a later document (IMF, 2003b; IDA, 2003) indicates that the necessary PRSP has yet to be prepared.

20. In another context, Hutchful (1994) spoke of ‘smoke and mirrors’.

21. Also, many of the internal constraints to development are not eliminated – for one of manyexamples, abundant patronage opportunities remain in the 212 subprojects (worth US$10.7m) in the Sierra Leone Economic Recovery Social Fund.

22. As Denny wrote in the Guardian Weekly (23–29 January 2003:23) about the HIPC Initiative, saying that it was ‘ … an accountant's approach based on how much money can be extracted from a country without it collapsing entirely.’

23. As in other forms of aid, there are great demands upon recipients for documentation,reports, statistical data, and trained personnel (Killick, 2004) – often beyond the capacity of third world nations.

24. There has been so much rhetoric in the past that the third world no longer believes whatmay be sincere efforts of the IFIs.

25. Data sources are from personal experience in 1967 and the most recent IMF report (2004:56).Ould-Mey (2003:47) compares the Leone's value against the US dollar for the 1980–2001 period (1.05 to 1975.00) for a devaluation of 187, 995% over the period. This not only has theconsequence of causing a marked decline in government export earnings, but also has an effect on consumer items throughout the country, even on non-exportable items because of the ‘knock-on’ effect on prices.

26. Archibald & Richards (2002) present evidence from questionnaires conducted in ruralcentral Sierra Leone that without improvements in the social factors (poverty, injustice, education, jobs, and youth empowerment) that war will return.

27. In a column in New Internationalist (351, November, 2002, p. 5), Oguine wrote: ‘Even as the world was praising Sierra Leone's relatively free and fair elections that followed years of civil war … NGOs in the country were ringing alarm bells. What the outside world saw as a move towards democracy, Sierra Leonean democratic activists saw as a potential return to the past, where two insensitive and corrupt political parties held sway. They feared a return to mass discontent, widespread bitterness and civil conflict.’

28. During the electoral campaign, in an effort to obtain votes in the Northern Province, theydid institute a rural development scheme in the North providing for micro-credit agriculture, thus indirectly addressing rural disquiet in small part.

29. Nor do they address the fact that the market in most parts of the third world is not only theresult of the impersonal economic factors of supply and demand, but is also conditioned by social exchange such as reciprocity and redistribution.