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EU signals €100m aid for Somalia to fast-track debt relief process

Storyline:Business, National News
Prime Minister Hassan Khaire pose for a photo with European Commissioner for Humanitarian Aid and Crisis Management Christos Stylianides in the sidelines of the just conclude security conference in Brussels. Photo: courtesy

The European Union is considering a €100 million package in direct support to Somalia in a bid to fast-track the debt relief process.

The EU bloc said it had expressed its commitment to enter into talks with the Federal Government on the package noting the international partner’s report last April that Somalia was making significant strides was a welcome note which called for support.

“..In support of this process, the EU welcoming indications from key partners, confirmed its commitment to discuss with the Federal Government of Somalia a package of up to €100 million in direct budgetary support,” a communique from the just concluded High Level Security Conference on Somalia in Brussels read in part.

The conference lauded the outcome of the Somalia Economic Roundtable at the Spring Meetings on April 19 where international partners agreed that time was conducive for pre-arrears clearance owed to International Financial Institutions. This, the partners said would open the way to international concessional financing and ultimately debt relief.

The EU package would be a major boost for the Federal Government as it seeks to finance economic recovery and create job opportunities for millions of young people many of whom are forced to attempt dangerous journeys abroad for better livelihoods. In the 2018 annual budget, the government factored in an expected donor injection of $118.6 million which slightly less than half of the whole budget set at $274.

Out of these amount, the government estimated it would receive $61.1 million from foreign governments and the balance from international organisations.

International partners meeting in Brussels this past week also expressed support for the implementation of the security Transitional Plan; a multi-phased strategy to hand over security from Amisom to Somali Security Forces. The donors pledged to set up a Task Force to mobilise funding for the three pillars of the Plan namely Operational, Capacity Building and Support of Stabilisation services.

But the partners called on the government to fast-track reform in the security sector which include biometric registration of security forces, deploying an electronic pay roll system and right sizing the national army. They also urged the government to pass the Gratuity Bill which is before Parliament as well as de-mobilisation of unqualified personnel.