Introduction Sierra Leone, officially the Republic of Sierra Leone, is a country in West Africa. It is bordered by Guinea in the northeast, Liberia in the southeast, and the Atlantic Ocean in the southwest and has a population of 5,900,000. Sierra Leone is slowly emerging from a protracted civil war and is showing signs of a successful transition. Investor and consumer confidence continue to rise, adding impetus to the country’s economic recovery. There is greater freedom of movement and the successful re-habitation and resettlement of residential areas. In 2001, Sierra Leone attracted US$4 million in foreign direct investment.

Rich in minerals, Sierra Leone has relied on mining, especially diamonds, for its economic base. It is perhaps best known for its blood diamonds that are mined and sold for high prices. In the 1970s and early 1980s, economic growth rate slowed because of a decline in the mining sector and increasing corruption among government officials.

By the 1990s economic activity was declining and economic infrastructure had become seriously degraded. Over the next decade much of the formal economy was destroyed in the country’s civil war. Since the end of hostilities in January 2002, massive infusions of outside assistance have helped Sierra Leone begin to recover. Much of the recovery will depend on the success of the government's efforts to limit corruption by officials, which many feel was the chief cause for the civil war. A key indicator of success will be the effectiveness of government management of its diamond sector.