Estimating Sierra Leone’s Aggregate Import Demand Function Under Binding Foreign Exchange

The primary objective was to evaluate the extent which foreign exchange restraints import demand in Sierra Leone. Using time series data from 1980 2020, this study determined Leone's function by including constraints a structural model developed Emran and Shilpi (2010). compensated for both short-run long-run links employing an ARDL bounds-testing technique with error-correcting mechanism. result showed that only presence of relationship between domestic consumption supported empirical evidence. In short run, consumption, scarcity premium, trade liberalization were found be significant predictors actual demand. However, long significant. Typically considered as key determinants demand, real effective rates premiums insignificant term. Therefore, indicates Leone has no short-term constraints. This could partially explained Bank strategy over years providing currency private sector assist importation essential goods. finding is not constrained shortage currency.