Somalia gets $306 million debt relief

MOGADISHU, Somalia - The government of Somalia signed a $306 million debt relief following an agreement with the Arab Monetary Fund (AMF) in what comes after stringent reforms spearheaded by the country's treasury towards stabilization of the economy.

Signed in Kuwait on Wednesday, the move is geared towards restructuring Somalia’s debt according to the Abu-Dhabi-based AMF. Somalia is one of the members of the Arab League of Nations among other regional economic forums.

Bihi Iman Egeh, the Finance minister who led a delegation to Kuwait, said the move enhances economic revolution in the country which has been struggling with instability for the last three decades. Somalia's economic recovery has been on a steady growth, he said.

“This agreement is fundamental to our long-term vision for sustainable development, economic growth, and deeper integration into the regional and global financial systems,” Egeh said following the signing.

For three decades, civil war has ravaged Somalia followed by the rise of terrorism. For the last four months, the government of Somalia has been fighting Al-Shabaab militants with the Puntland forces also facing ISIS terrorists in the north.

The government views debt relief as a cornerstone of its strategy to attract investment, restore fiscal discipline, and boost public confidence. Minister Egeh further stated that the deal is a signal of growing international confidence in Somalia’s economic trajectory and reform efforts.

The debt relief package adds to the momentum generated by previous steps under the Heavily Indebted Poor Countries (HIPC) initiative and broader international support for Somalia’s fiscal rehabilitation, officials said.

Somalia recently discovered oil deposits, but they have yet to be fully utilized following years of instability. Once fully operationalized, the discovery is set to improve the country's economy by creating job opportunities for the youth.

GAROWE ONLINE