(U) KUDOS FOR REPORTING ON SIERRA LEONE CURRENCY

C O N F I D E N T I A L STATE 102966

NOFORN
SIPDIS

E.O. 12958: DECL: 10/02/2034
TAGS: PINR ECON SL
SUBJECT: (U) KUDOS FOR REPORTING ON SIERRA LEONE CURRENCY
(C-AL9-02044)

REF: A. FREETOWN 000322

B. FREETOWN 000321

C. FREETOWN 000262

Classified By: MICHAEL P. OWENS, ACTING DIR, INR/OPS. REASON: 1.4(C).


1. (C/NF) WASHINGTON ANALYSTS GREATLY APPRECIATED POST'S
REPORTING ON THE RECENT DECLINE IN THE VALUE OF THE SIERRA
LEONE CURRENCY, AS REPORTED REFTELS (FREETOWN 000322,
FREETOWN 000321, FREETOWN 000262). POST'S ANALYSIS
IDENTIFIED THE CAUSE OF THE CURRENCY'S SLIDE, THE IMPACT OF
THE GLOBAL ECONOMIC SLOWDOWN, AND THE POSSIBLE IMPACT THAT A
FURTHER DEVALUATION COULD HAVE ON POLITICAL STABILITY. WE
WOULD GREATLY APPRECIATE FURTHER REPORTING ON THE TOPIC, AS
TIME AND RESOURCES ALLOW. IN PARTICULAR, WE ARE INTERESTED IN
INDICATIONS THAT CURRENCY DEPRECIATION AND RELATED ECONOMIC
HARDSHIPS COULD ERODE SIERRA LEONE'S FRAGILE POST-CONFLICT
RECONSTRUCTION. FOR INSTANCE, HOW HAS THE POPULATION COPED
WITH THE RISING PRICE OF IMPORTS? HAVE GOVERNMENT OFFICIALS
PRESSED FOR WAGE INCREASES TO OFFSET DECLINING PURCHASING
POWER? AT WHAT POINT COULD RISING FUEL AND FOOD PRICES
TRIGGER UNREST? MANY THANKS.
CLINTON