U.S. Formally Writes Off $1.14 Billion of Somalia’s Debt

GOOBJOOG NEWS|MOGADISHU: The US has forgiven $1.14 billion of debt owed by Somalia following a bilateral agreement between the two countries in a major milestone towards Somalia’s debt free status.

US ambassador to Somalia Richard Riley announced the deal Tuesday following the signing of a bilateral agreement with Finance Minister Bihi Ege h in Mogadishu.

Riley said the debt cancellation is in addition to $1.2 billion the US has provided to Somalia this year in form of development, economic, security, and humanitarian assistance.

Finance Minister Egeh welcomed the agreement terming it a product of concerted fiscal reforms by the Somali government. “This follows the successful debt relief process and the Paris Club agreement of March this year, which supported debt cancellation for Somalia,” the minister said.

The US debt was the largest component of the $4.5 billion which Somalia owed several countries and multilateral organisations. The Horn of Africa nation reached the Completion Point of the Heavily Indebted Poor Countries (HIPC) initiative last December which saw the cancellation of the debt.

The cancellation comes on the day the US went to elections in which it is now projected that former President Donald Trump will be re-elected.