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IMF says Somalia’s funding is tied to elections

MOGADISHU (SD) – The head of the International Monetary Fund (IMF) for Somalia, Laura Jaramillo, told Reuters, it will suspend funding to support Somalia’s military and other vital services in May, if the country doesn’t complete the elections process.

The International Monetary Fund (IMF) have been assisting the Somali government since 2017 with the payment of salaries to soldiers and civil servants with a current three-year budget of approximately $ 400 million.

“It will impact the government’s functioning and could have broader implications,” she said, referring to the risk that much-delayed elections are not completed in time to renew the deal.

Somali Minister of Finance Abdirahman Beileh, however, disagrees with the IMF’s assessment and told told Reuters he has a different view.

“We are confident that elections will be concluded in time so as to not affect the reform programme,” he said. “There have been no major challenges in meeting the IMF conditions thus far, and we do not anticipate any.”

Delays in Somalia’s parliamentary and presidential elections are now in their second year, but are now in full swing.

Reuters reports that the expiry of the IMF programme would also halt Somalia’s journey to debt forgiveness. Under the 2020 deal, approved by the World Bank and the IMF, Somalia’s debt was reduced to $3.7 billion, or 63% of GDP, from $5.2 billion or 89% of GDP.

Adding that the if completed next year, debt should drop to $557 million or 6% of gross domestic product.

The IMF program is enabling other donors to help Somalia and the government to lend a helping hand to strugling families, according to the report.

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