Somalia renews ties with global financial system

Text by: RFI Follow

For the first time in 30 years, the country has normalized its relations with the World Bank. Mogadishu has settled its arrears, which marks the end of a long process which should offer development opportunities.

Publicity

With our correspondent in Nairobi, Sébastien Nemeth

Somalia has come a long way, having accumulated more than five billion dollars in debt at the end of 2018. But in view of the progress made and the payment of arrears, the World Bank has therefore accepted the return of Mogadishu to its fold. This means that the country can once again access grants or loans that can be invested in education, health or even infrastructure. All of this offers hope for development and poverty reduction.

For several years, Somalia has benefited from the HIPC initiative for the heavily indebted poor countries. The program allows creditors to alleviate the debts of underprivileged nations, thereby reducing the constraints on economic growth.

Mogadishu's reforms

In return Mogadishu undertook fiscal, economic and political reforms. The country has strengthened its legal arsenal and systems in revenue collection, the budget, and procurement. We can cite the law on the management of public money, that on companies intended to facilitate business or even an annual audit of the budget presented to Parliament.

Hugh Riddel, representative of the World Bank in Somalia, said he observed " fundamental reforms, increasing income generation, not only at the capital's ports and airports, but also in the private sector. "
Before Somalia, 36 nations validated debt relief, such as the DRC, Togo, Mali and even Côte d'Ivoire.

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• Somalia
• Finance