Tuesday December 31, 2019
MOGADISHU (HOL) - Somalia Federal Parliament Tuesday a $459.5 million budget for the financial year 2020 before it proceeds for recess in the coming week.
The joint seating of both the Upper House and Lower House chaired by speakers of both Houses unanimously endorsed the budget which is an increase from this year’s $380 million.
Finance Minister Abdirahman Beileh hailed the passage of the budget noting it will go a long way in helping the government to ‘continue to strengthen the policies and process to realise this year’s budget through domestic revenue mobilization’.The increase in the budget is informed by robust domestic revenue mobilization that has seen the government now fund the budget to about 56% as it gradually weans itself of overreliance on foreign aid.
The need for more budgetary allocations is also informed by the increasing needs especially within the social sectors which have over the years received minimal allocations as security and administrative costs gobbled up most of the budget.
Preparations for the 2020 elections also informed the increase in the budget vote though most of the election funding is expected to come from the donor community.
According to the newly released 9th National Development Plan, bilateral aid is projected to decline as a source of revenue from 36 percent in 2019 to about 9 percent annually between 2020 and 2022.
Somalia is also inching closer to debt relief hence the need to meet conditions in the IMF/World Bank debt relief process which calls for economic reforms and poverty reduction initiatives such as those contained in the NDP 9.
The IMF approved a financing plan December 18 that will help the IMF cover its share of the debt relief for Somalia-includes cash grants from member countries and IMF internal resources.