The Minister of Finance has disclosed that the government of Sierra Leone like other post HIPC/MDRI countries faces the daunting challenge of domestic debt overhang.
He said that the domestic debt stock, which are mainly instruments issued by the Bank of Sierra Leone is estimated at Le1.0 trillion includingLe443 billion of non-marketable non-interest bearing securities.
The Finance Minister also pointed out that domestic debt burden payments through payments of interest on treasury bills and treasury bearer bonds account for nearly 20% of the domestic burden revenue.
He said that to address the overall debt situation a debt strategy framework has to be designed to resolve the issue of domestic debt.
Mr Carew averred that he has no doubts that the development in the capital markets will deepen domestic markets which will facilitate trading in government’s bonds.
The Minister revealed that after HIPC Sierra Leone is committed to allocating the resources freed by the present debt cancellation to priority areas identified in the country’s poverty reduction strategy.
He pointed out that consistent with the Poverty Reduction and Growth Facility and the second generation of the PRSP costing, it is envisaged that the financing gap will be quite huge.
Mr Carew said government will strengthen the review administration to improve revenue mobilization aimed at reducing overdependence on external resources.
The Minister stated that they will however continue with reform measures to achieve sustainable growth.