Somalia’s Economy to Grow by 3.7%, Up From 2.8%, IMF Says

GOOBJOOG NEWS|MOGADISHU: Somalia’s economy is projected to grow by 3.7% this year, up from 2.8 the previous year, the International Monetary Fund has said, signalling an upward trend in major economic indicators.

According to a statement from the IMF team which concluded its staff-level agreement with Somali authorities this past week, Somalia will realise a strengthened growth in 2024,’supported by continued recovery in agriculture, remittances, and investment, though risks remain.’

“Livestock and crop exports are expected to recover following the resumption of rainfall. Remittance inflows are expected to improve in the context of moderating global inflation and an upgrade of the global growth outlook,” the statement read in par.

The lender added that Foreign direct investment is expected to trend upward following the debt relief to the tune of 4.5 billion in December. Inflation is expected to decline to 4.8 percent in 2024 from 6.1 percent in 2023, reflecting better crop yields and lower commodity prices, the report said.

The IMF team leader, Laura Jaramillo said following the conclusion of the review, which lasted between February 26 and March 7 that the IMF and Somalia had reached a staff-level agreement on policies to complete the first review under the ECF arrangement approved in December 2023 for total access of SDR 75 million (about US$100 million).

The agreement is subject to approval by the IMF’s Executive Board. Board approval would enable access to SDR 7.5 million (about US$10 million), bringing total disbursements under the arrangement to about US$50 million.