Arab Fund Grants Somalia $306.5M Debt Relief in Reform Boost

GOOBJOOG NEWS | KUWAIT: Somalia has signed a landmark $306.5 million debt relief agreement with the Arab Monetary Fund (AMF), a move hailed by the government in Mogadishu as a pivotal step in its efforts to stabilize and rebuild the economy after decades of conflict and natural disasters.

The agreement, signed Wednesday in Kuwait, involves the restructuring of Somalia’s debt to the AMF, according to a statement by the Abu Dhabi-based institution, which promotes financial stability and economic development across Arab member states. Specific terms of the restructuring were not disclosed.

Somalia’s Finance Minister Bihi Iman Egeh, who led the delegation to Kuwait, described the deal as essential to advancing the country’s economic reform agenda and re-engaging with key regional financial institutions.

“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.

The Horn of Africa nation has been working to rebuild its economy following years of civil war, compounded by recurring climate shocks including droughts, floods, and locust infestations.

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 momentum generated by previous steps under the Heavily Indebted Poor Countries (HIPC) initiative and broader international support for Somalia’s fiscal rehabilitation.