11/27/2024
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‎Somali cabinet approves 2022 federal budget
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    Friday May 27, 2022




    ‎Mogadishu (HOL) - During the weekly federal cabinet meeting, Somali Prime Minister Mohamed Hussein Roble approved a nearly billion-dollar federal budget for 2022.

    It was the first cabinet meeting since President Mohamud officially took over the reins of government.

    Somali Finance Minister Abdirahman Duaale Beyle submitted the $918.7M federal budget to the cabinet, which was approved. 

    "The revised version of the 2022 Somalia budget has been approved by the cabinet chaired by PM Mohamed Roble and will now be forwarded to parliament for approval. The utilization of this budget will start on 1st July 2022 for six months," Beyle tweeted on Thursday.

    ‎The 2022 budget is showing steady increases from previous years, with $247.7 million more than last year's budget, which was $671 million, compared to $476 million in 2020. ‎ In 2018, Somalia's federal budget was $267.5M.

    ‎The cabinet will submit the country's new budget to the new Somali parliament for approval.

    According to Somali economists, the economy contracted by 0.3% in 2020, primarily due to COVID-19, failed rains and a locust infestation, but recovered in 2021 and is expected to grow to 2.9% in 2022, which would be a return to pre-COVID growth rate levels.

    In its 2022 Budget Strategy paper, Somalia's Ministry of Finance said the government had implemented reforms to counter the dollarization of the economy, with plans to introduce a new currency that would curb rampant counterfeiting.

    It also said that the Ministry prioritized achieving the IMF-instituted reforms necessary to achieve debt relief under the HIPC initiative.

    Last week, the IMF and Somalia reached an agreement for the second and third reviews of Somalia's economic program that would extend budget support until August 17.

    As it stands, Somalia currently owes $3.7 billion, or 63% of GDP, after the  Paris Club of creditor nations agreed to restructure Somalia's debt, including immediately cancelling $1.4 billion. If Somalia can complete the IMF program, the outstanding debt would drop to $557 million, or 6% of Somalia's GDP.

     





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