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Agro-industrial foreign investment and rural transformation: Lessons from the Makeni Project in Sierra Leone

This policy brief distills the findings of an SEI study of a major bioenergy project’s impact on rural development and local livelihoods.

Sierra Leone, like many Least Developed Countries, has pursued foreign direct investment (FDI) as a way to jump-start its economy, and prioritized bioenergy for its potential to advance rural development. The 400 million EUR Makeni Project highlights both the benefits and the risks of that strategy.

The project has created thousands of jobs, built hundreds of kilometers of roads and extensive other infrastructure, and brought new sources of income into rural communities. Once it is operating at full capacity, it will also feed 15 MW of power into the national grid, about 20% of the country’s supply. The Makeni Project has also provided training in farming, business and other skills, introduced mechanized agriculture with modern inputs, and developed new vegetable gardens. This has dramatically increased the productivity of rice fields, diversified diets and supported small-scale commercialization.

However, by leasing large amounts of land, the project has directly affected the availability and use of key livelihood resources. Moreover, lack of government oversight and engagement on the ground has resulted in missed opportunities – from roads built by the developer that could have been extended to reach now-isolated villages, to jobs that would be available to local people if they gained the necessary skills.

Least Developed Countries seeking to make the most of FDI should make it a priority to strengthen governance, with particular attention to regulatory structures, technical know-how, and coordination among key agencies. Development partners, finance institutions and NGOs should support these efforts.

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