Somalia: Finance Minister Says Country Passes Trust Factor

Somalia’s finance minister said the country is winning in its effort to get the trust of international financial institutions and could receive debt relief as early as next year.

Abdirahman Duale Beileh, who participated in the spring meeting of the International Monetary Fund (IMF) and World Bank last week in Washington, said Somalia has “passed [the] trust” factor with international creditors following roundtable meetings.

“They [IMF] have submitted their assessment, and they said Somalia has passed,” he said. “Somalia can be trusted. Somalia is back. And Somalia has to be supported to move with the clearance of arrears sometime next year.”

Somalia owes an estimated $5.5 billion to international creditors, the Paris club, the non-Paris club and other international financial institutions. Beileh said those groups are working to see Somalia cleared of its debts next year.

“They are all moving together in tandem, but they all agree that sometime next year, everything will be done,” he said during an interview in VOA studios in Washington. “Countries and organizations are also promising a pre-arrears clearance fund to be established for the assistance of Somalia.”

Somalia and the IMF signed staff-level agreements aimed at monitoring Somalia fiscal reforms and increased revenue. Beileh said the government has successfully completed two IMF staff-monitored programs.

Rise in domestic revenue

In the first quarter of this year, the Somali government reported collecting $42.5 million in domestic revenue, the highest in a single quarter in recent history. In February this year, the government introduced a new 5 percent sales tax on businesses to further boost income.

Beileh said development and reconstruction projects by the international donors will be channeled through the federal government from now on. He said even if NGOs have to implement the projects, the government will set the priority and will monitor.“They will be trusting us with whatever enters the country, the federal government will be responsible and trusted. It’s estimated to be over a billion dollars,” Beileh said.Despite the minister’s statement, Somalia is still ranked the most corrupt country in the world, according to Transparency International. The Somali minister said the group ranked Somalia based on “perception.”“IMF knows […]

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