Somalia’s elections delay puts funding at risk- IMF

The International Monetary Fund could stop its programme in Somalia in three months if long-postponed national elections encounter fresh delays, a senior official said, as she began a mission to the troubled Horn of Africa nation on Tuesday.

The IMF’s programme in Somalia is due for a review in mid-May, but election delays mean that a new administration may not be ready to endorse planned reforms in time, said Laura Jaramillo Mayor, the fund’s mission chief for the country.

“Review of the IMF supportive programme for Somalia needs to be completed by May 17, 2022, if it is not completed by that date the programme automatically terminates,” she said.

She added that this will in turn severely affect the impoverished country’s budget and an agreement to reduce its debt from 5.2 billion U.S. dollars (4.6 billion euros) in 2018 to a target of 557 million eventually.

Somalia’s polls are more than a year behind schedule, with voting for the lower house of parliament due to be completed by Friday, a deadline many observers expect the country to miss, with over 100 seats still pending.

Under the terms of the IMF programme, Somalia’s debt could fall to $557 million or around six percent of its estimated gross domestic product as early as 2023, allowing Mogadishu to attract more funding from international partners and help develop its private sector, Jaramillo said.

One of the poorest countries in the world, with nearly 70 percent of its population living on less than $1.90 a day, Somalia is struggling to recover from decades of civil war and has also been battling an Islamist insurgency for decades.

Every month, the country’s federal government runs short of $10 million to cover crucial expenses such as staff salaries.

However, Jaramillo said Somali authorities have worked hard to strengthen government institutions, particularly in terms of tax collection and controlling public spending.

CGTN/Olajumoke Adeleke