Identifier
Created
Classification
Origin
08FREETOWN184
2008-04-16 16:38:00
CONFIDENTIAL
Embassy Freetown
Cable title:  

PRESIDENT KOROMA INTERCEDES WITH CONCESSIONS TO

Tags:  ECON ETRD EAGR SL 
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VZCZCXRO9890
RR RUEHPA
DE RUEHFN #0184 1071638
ZNY CCCCC ZZH
R 161638Z APR 08
FM AMEMBASSY FREETOWN
TO RUEHC/SECSTATE WASHDC 1859
INFO RUEHZK/ECOWAS COLLECTIVE
C O N F I D E N T I A L FREETOWN 000184 

SIPDIS

SIPDIS

E.O. 12958: DECL: 04/16/2018
TAGS: ECON ETRD EAGR SL
SUBJECT: PRESIDENT KOROMA INTERCEDES WITH CONCESSIONS TO
KEEP SEABOARD MILL IN SIERRA LEONE

REF: A. FREETOWN 44


B. FREETOWN 80

C. FREETOWN 182

Classified By: Ambassador June Carter Perry for reasons 1.4(b) and (d)

C O N F I D E N T I A L FREETOWN 000184

SIPDIS

SIPDIS

E.O. 12958: DECL: 04/16/2018
TAGS: ECON ETRD EAGR SL
SUBJECT: PRESIDENT KOROMA INTERCEDES WITH CONCESSIONS TO
KEEP SEABOARD MILL IN SIERRA LEONE

REF: A. FREETOWN 44


B. FREETOWN 80

C. FREETOWN 182

Classified By: Ambassador June Carter Perry for reasons 1.4(b) and (d)


1. (C) SUMMARY: As reported in reftel A and B, Seaboard West
Africa Ltd., an American-owned company operating the only
flour mill in Sierra Leone, found itself in dire financial
straits due to the volatility of the world commodities
markets and price ceilings on flour. These negatively
impacted the competitiveness of Seaboard flour versus the
price of imported flour. Following a series of talks with
high-level government officials, Seaboard succeeded in
winning the concessions it needed to level the playing field
between itself and flour importers. Consequently, it plans to
keep its doors open for the foreseeable future. The
concessions were granted by President Koroma, indicating his
strong interest in supporting domestic enterprises, but also
possibly creating a precedent that corrective action is only
taken if he becomes directly involved. END SUMMARY.


2. (C) Daniel Awani, Seaboard West Africa's Financial
Manager, informed the Embassy on April 15 that operations
will continue in Sierra Leone despite previous reports to the
contrary. Seaboard's plans to shut down operations were
almost complete (reftel B) and plans to move the entire
operation elsewhere were underway.


3. (C) Seaboard's ongoing discussions with the Vice President
and the Ministers of Trade and Industry and Finance, despite
vague government promises, had been unproductive in achieving
any concrete actions to ameliorate the unfair price
competition between Seaboard and flour importers. Ambassador
Perry's own meeting with the Minister of Presidential Affairs
and Public Affairs (reftel C),in which Seaboard's importance
to Sierra Leone was raised, received little response; the
official did not seem to be aware of the on-going discussions
between the parties. Seaboard's final attempt to save the
operation was to present their case via letter to President
Koroma.


3. (C) Although the President did not respond immediately,
Awani said that the Minister of Finance finally allowed
Seaboard an exemption from paying sales tax (COMMENT:
Ambassador Perry received a call from Seaboard Vice President
Ralph Moss indicating he had spoken with the Minister of
Finance who promised support to Seaboard. END COMMENT.). The
action was apparently taken at Koroma's request. Awani
avoided the specifics on the further concessions Seaboard was
granted, but they will allow Seaboard to remain competitive
with the flour importers. Awani also said that the Finance
Minister promised to ensure that the importers pay all their
required dues, which, according to Seaboard, they had
previously failed to do.


4. (C) COMMENT: This is a positive outcome for Seaboard,
which subsidized its failing operation here for over a year
due to their desire to remain in Sierra Leone. Despite our
inquiries, Seaboard has never been forthcoming about their
concession demands and their reticence to discuss details may
indicate that Seaboard is receiving unique governmental
assistance. Nevertheless, Seaboard employees will be glad
they will be able to retain their jobs, particularly in a
country where formal sector jobs of any kind are scarce.
Moreover, while Koroma's intervention makes clear that he is
serious about assisting domestic industry, we are not certain
his pro-business message has been fully adopted by key
Cabinet members. It was not until he became involved that his
cabinet moved forward, which raises a concern that he may be
setting a precedent to intercede in low-level decisions to
ensure his policies are carried out. Ultimately, he needs to
create a policy action plan to ensure equitable treatment for
private industry concessions and avoid a trap in which he
finds himself distracted from other duties by the need to
micromanage on an ad hoc basis. END COMMENT.
PERRY