Sierra Leone Compact - Constraints Analysis

MCC’s evidence-based approach to its investments begins with a mutual understanding of a country’s main growth challenges. During the first phase of the compact or threshold program development process, MCC and the selected partner country, jointly conduct a constraints-to-growth analysis (CA). This analysis identifies the constraints to private investment and entrepreneurship that are most binding to economic growth in the country. The results of this analysis enable the country, together with MCC, to select activities most likely to contribute to sustainable, poverty-reducing growth.

The Constraints Analysis Report for the Sierra Leone Compact highlights the following binding constraints to economic growth:

1. Power: Sierra Leone lacks sufficient power resources, in terms of generation, transmission, and distribution, to support firm and household activities with heavy consequences to private sector investment and job creation.
2. Health: Malaria, Sierra Leone’s leading cause of death, poses a costly burden on people’s health, productivity, and finances.
3. Food Insecurity and Supply: Low food production and high food prices force a large segment of the population to sacrifice their diet and livelihoods in order to survive.
4. Water: Poor drinking water infrastructure, particularly in the capital Freetown, imposes large firm and household costs in terms of time, health, money, and security.