Somalia's parliament approves $459.5 million budget for 2020

MOGADISHU, Somalia - A joint sitting of Somalia's Upper and Lower Houses on Tuesday approved $459.5 million budget for 2020, setting the pace for the fiscal year, Garowe Online reports.

The budget is slightly higher than the immediate ending fiscal estimates which stood at $380 million. The extra amount is meant to finance development activities.

Of the 189 members present during Tuesday's sitting, two abstained from voting while one rejected, paving way for its implementation.

Upper House Speaker Abdi Hashi Abdullahi and his Lower House counterpart Mursal Sheikh Abdirahman chaired the sitting.

Most of the budget is financed by donors with locally generated revenue serving gaps that exist in the budget. Turkey is among the leading donor nations.

The increase in budgetary allocations is attributed to the collection income tax generated by the Ministry of Finance, the government said.

Somalia is expecting the IMF to write off her debts amounting to close to $4.8 billion as part of the rebuilding process with the help of the international community.

Once the huge debt is written off, Prime Minister Ali Hassan said in a past function, Mogadishu will be able to access new loans from the financial institutions.

Most of the budget is meant for recurrent expenditure with the little percentage set for the country's development, Treasury had said.

The approval comes three months after the country's Auditor General raised questions about spending of government resources, including shoddy expenditures.

About $18 million from the European Union, Saudi Arabia, and the United Nations, the report stated, did not pass through the treasury’s account at the central bank.

Some of the money was kept in offshore accounts with weaker controls, thus avoiding audits from relevant agencies and donors.

Turkey gave Somalia $20 million in cash, but there was no independent audit trail for it, the report said.

“There is a risk that external assistance from Turkey was not banked intact in the Treasury single account in a timely manner,” it read.

Somalia has spent decades rebuilding the education system, infrastructure, health, and other departments since the collapse of the Siad Barre regime in 1991.

While the government pays workers, most Somali National Army troops are paid through donor funds, although the exact number is yet to be established.

Recently, US Congresswoman Ilhan Omar said: "I am pleased with the progress in Somalia, the US should support debt relief quest."

IMF had raised a red flag on Somalia's debt, arguing that they had exceeded the Gross Domestic Product of the country by 101 percent.

GAROWE ONLINE