Abstract

This paper explores the role of informal cross-border trade (ICBT) in Sierra Leone’s economy, highlighting its significance as a driver of economic growth and development. Through a review of theoretical and empirical literature, combined with analysis of Sierra Leone’s ICBT practices, the study reveals the scale, characteristics, and economic impacts of ICBT. The findings indicate that ICBT plays a crucial yet often overlooked role in Sierra Leone’s economy, contributing to income generation, job creation, and economic growth while enhancing food security and driving infrastructure development. However, ICBT also faces challenges such as legal and regulatory risks, trade instability, limited access to financial services, and potential tax evasion and unfair competition. The paper proposes policy recommendations to regulate and guide ICBT, aiming to harness its positive impacts while mitigating its negative effects. By strengthening border management, establishing a regulatory framework, providing support to traders, and promoting regional economic integration, Sierra Leone can foster the sustainable development of ICBT and advance its economic growth and development.