Sierra Leone Creates Unit to Boost Mining Revenue, Limit Fraud

  • Office to review mining production, export figures at mines
  • Tax authority on pace to meet 2015 collection target

Sierra Leone created a unit to help boost tax revenue from mining and reduce fraud to revive an economy battered by Ebola and slumping metal prices.

Lawmakers appointed Bockarie Tarawallie, a member of the National Minerals Advisory Board, to head the Extractive Industry Revenue Unit last week. The government collected 1.1 trillion leones ($252 million) in tax revenue in the first half of the year and expects to meet its target of 2.2 trillion leones in 2015, Mohamed Bangura, corporate affairs manager at the National Revenue Authority, said in an interview Oct. 8.

“We will not only be auditing their books, but be auditing the production, the export, the processing,” he said in Freetown, the capital. “We will go to the mining sites. The intention is to broaden the tax base and block all the loopholes.”

Sierra Leone’s iron-ore industry has already been devastated by a combination of falling prices and the Ebola virus. African Minerals Ltd. shuttered its Tonkolili mine last year after running out of cash, while rival London Mining Plc went into administration in October 2014. The West African nation’s economy will contract about 22 percent this year and will probably expand 1 percent next year, Samuel Turay, head of economic and labor statistics said in September.

Agriculture accounts for 45 percent of gross domestic product and shipments of iron ore provide about half of all exports. Ore with 62 percent content delivered to Qingdao fell 2.9 percent Tuesday to $54.97 a dry metric ton, close to the lowest since at least May 2008.

Before it's here, it's on the Bloomberg Terminal.