[LINK] "Iron Price War Deepens Crisis in Ebola-Stricken Sierra Leone"

[rfmcdonald]

This multiply-authored Bloomberg article touches upon the economic ramifications of the West African Ebola epidemic.

Sulaiman Kamara, a handcart pusher in Freetown before the outbreak began in May, used to earn 50,000 leones ($11) a day, before a shriveling economy took away his job. The 42-year-old father of three now hawks cigarettes and candy on streets with shuttered shops and restaurants, empty hotels and idling taxis. Some days, he’s lucky to make a quarter of his former earnings.

Things are about to get worse again. Iron ore, the biggest export earner, is in a major tailspin, leaving Sierra Leone’s two miners on the verge of collapse and jeopardizing 16 percent of gross domestic product in a country where output per person was just $809 last year.

Used in steelmaking, iron ore has slumped 39 percent this year as the world’s largest miners spend billions of dollars expanding giant pits in Australia and Brazil. Digging up ore that’s less rich in iron and operating with restrictions imposed to stop the disease’s spread, local producers can’t compete.

“The impact of Ebola in terms of iron-ore revenue is huge,” said Lansana Fofanah, a senior economist in Sierra Leone’s Ministry of Finance and Economic Development. “Iron ore is responsible for the country’s double-digit growth since 2011 until the Ebola outbreak.”

Iron ore contributes more in mining royalties than any other mineral to government revenue, which has plunged since the outbreak began, and as the budget deficit worsens, the International Monetary Fund has agreed to step in.