A Nimble Review of the Development Path of Sierra Leone Stock Market

Economies with more active stock markets develop faster over successive decades. Such development remains attainable even after adjusting for various other factors underlying economic growth. Sierra Leone is one country whose stock market is now more than a decade old but remains poorly active. The number of listings as well as participation in the stock market remains low and insignificant. The study made a light review of the development path of the stock market in an effort to identify the derailing issues and suggesting ways to resolve. Through the review, it was obtained that there exist combinations of factors hindering the growth of the stock market. Inadequate support from the government has been identified, the privatisation concept was never implemented to the expected level, nature of business in the economy being mainly family-oriented and single proprietors, low levels of awareness of the general populace to issues of stock exchanges, limited participation by foreign investors, and high levels of corruption all are impacting factors. Significant reforms have to be made in the regulatory environment. Privatisation journey should be pursued effectively to improve listing by large firms. Foreign participation in the stock market elevated to some significant levels. The economy should continue to address issues of corruption so as to minimise its impact to institutional development. Public awareness should be enhanced to improve stock market participation by natives. Policies that promote foreign direct investment should be implemented. Management of political climate remains crucial for investors to have confidence and trust in their investments thereby attracting more for further development. Policy makers should walk the talk and demonstrate highest levels of commitment.