Cabinet approves $967.7M budget as Somalia struggles with Al-Shabaab threat

MOGADISHU, Somalia - The Somali cabinet on Tuesday approved the first fiscal budget under the leadership of PM Hamza Abdi Barre, paving way for the implementation of various projects as proposed by the current administration, which sailed to office in May after a delayed election.

The ministers, most of who seat in parliament, approved $967.7 million for the 2022/23 Budget, which is so far the highest in Somalia's fiscal expenditure. The approval comes at a time the country is grappling with a myriad of challenges including but not limited to the Al-Shabaab menace.

Also, Somalia has been in the past struggled to justify some of the expenditures, with the Auditor General putting to task a number of ministries for embezzlement of funds. In 2020, a number of senior officials in the Finance and Health ministries were jailed for stealing millions meant for Covid-19 mitigation.

Of the money in the budget, the country is expecting to collect close to $283.3 million from domestic revenue, an increase of $36.3 million given that 2022 domestic revenue projections were $247 million. The country does not have solid revenue collection methods according to International Monetary Fund [IMF].

Surprisingly, the country's projections for domestic revenue almost rival those of Al-Shabaab terrorists, who are said to be running a budget of up to $100 million, with $24 million set aside for the purchase of weapons. The government has warned business owners against funding Al-Shabaab whether through extortion or willingly.

Earlier this week, State Department also asked people to volunteer with information on Al-Shabaab finance networks, with a reward increased to $10 million. The US is keen to destroy Al-Shabaab sources of revenue as a strategy to eliminate the militants who control rural areas.

Dr. Elmi Mohamud Noor, the minister of finance, thanked the ministers for approving the budget which is, however, subject to verification by the Senate and Lower House. The federal government wires some amount to member states for development and recurrent expenses.

The federal member states suspended cooperation with the Finance Department, accusing the minister of violating some of the previous federal agreements. However, the National Consultative Council has since solved the impasse, an indication that parliament will approve the budget.

Somalia largely funds its budget through external debts which have accumulated over years, with the IMF and World Bank being the biggest lenders. Some of the expenses are also serviced by members of the international community through grants whose utilization ought to follow stringent guidelines.

GAROWE ONLINE