Somalia Urged to Boost Domestic Revenue and Investment to Drive Growth

GOOBJOOG NEWS | MOGADISHU: Somalia needs to expand domestic revenue, attract greater private investment and strengthen productive industries to sustain economic growth and create jobs, according to a new report by the National Economic Council.

The council’s fourth annual State of the Somali Economy Report 2026 examines the country’s economic performance and the challenges facing its efforts to build a more resilient economy, highlighting the importance of stronger public finances and investment in productive sectors.

The report identifies limited job creation, weak domestic production, reliance on external financing and the growing effects of climate change among the obstacles to sustainable growth.

It also points to progress in domestic revenue collection, public financial management and the development of financial services, areas considered important to strengthening the government’s capacity to fund public services and reduce dependence on external support.

Hassan Aden Xoosow, economic adviser to the president and executive director of the National Economic Council, said reliable economic data produced within Somalia was essential for sound policymaking and national decision-making.

The council’s national economic adviser, Dr Abdi Nur Ali Mohamed, highlighted the need to increase domestic revenue, improve transparency in public spending and encourage investment by Somali businesses and the diaspora.

He also called for greater support for productive sectors capable of generating employment and expanding the country’s economic base.

Somalia faces the challenge of translating economic progress into broader improvements in living standards, particularly in a country where job opportunities remain limited and many households depend on livestock, agriculture, remittances and informal trade.

Climate shocks, including recurrent droughts and floods, also threaten livelihoods and productive activity, while insecurity and infrastructure gaps continue to constrain investment in parts of the country.

Strengthening domestic revenue and improving the efficiency of public spending could give the government greater scope to finance infrastructure and essential services. However, sustained progress will also depend on creating conditions in which private businesses can expand, hire workers and invest in local production.

The report places economic resilience at the centre of Somalia’s development agenda, with an emphasis on mobilising domestic resources, broadening investment and strengthening the institutions needed to support long-term growth.