IMF Approves $10 Million for Somalia, Boosting Total Support to $50 Million

The International Monetary Fund (IMF) has approved an immediate disbursement of $10 million to Somalia for budget support. This brings the total funds provided under the Extended Credit Facility (ECF) to $50 million.

This decision came after the IMF’s Executive Board completed the first review of the ECF arrangement for Somalia on Wednesday.

Ms. Antoinette Sayeh, the Deputy Managing Director and Acting Chair, praised Somali authorities for their strong commitment to reforms following the completion point under the Heavily Indebted Poor Countries (HIPC) Initiative in December 2023. “Somalia’s performance under the Fund-supported Extended Credit Facility Arrangement has been strong. The authorities’ continued strong ownership of the reform agenda will be important to build resilience, promote inclusive growth, and reduce poverty. Continued and timely support from development partners is also critical for the successful implementation of the reform strategy,” she said.

Ms. Sayeh highlighted Somalia’s achievements in increasing revenue and implementing revenue-enhancing reforms, such as customs modernization and a new income tax law. She emphasized the need for ongoing improvements in public financial management, including payroll integration, expenditure controls, and debt management.

The Deputy Managing Director also commended efforts to strengthen the central bank’s capacity and develop monetary and exchange rate policies, particularly in light of planned currency reforms. She noted the importance of promoting financial inclusion, improving the anti-money laundering and combating the financing of terrorism (AML/CFT) framework, and enhancing governance.

Additionally, Ms. Sayeh pointed out Somalia’s focus on building capacity in the petroleum sector, addressing food insecurity, building climate resilience, and enhancing trade integration to support long-term development.

Somalia’s ECF arrangement, originally approved by the IMF Executive Board on December 19, 2023, supports the country’s reform strategy aimed at strengthening economic institutions and promoting stability and growth. This aligns with Somalia’s national development plan and long-term vision for economic stability, improved revenues and public financial management, financial deepening, better governance, and enhanced statistics

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