An IMF team which visited Somalia’s to review Article IV programme, has observed that Somalia’s economy continues to be in the road to recovery, touching a growth rate of 3% in 2019 against 2.8% last year. Article IV consultation is part of the IMF’s mandate to scrutinise the economic, financial and exchange rate policies of its members. Since 1991, Somalia has been facing civil war when clan-based warlords fought against each other after overthrowing President Siad Barre.who served as the President of the Somali Democratic Republic from 1969 to 1991. The situation worsened during the past decade by famine and sporadic terror attacks by al Qaeda-linked al Shabaab. Allison Holland, who led the IMF delegation said that the recovery of Somalia’s economy was supported by vigorous activity in the construction, telecommunications, and financial services sector in 2018. The IMF statement observed that the Somali government has expanded the tax base and improved tax administration, boosting domestic revenue by 30% to $184 million in 2018 from a year earlier, and to $54 million for the first quarter of 2019.
The IMF statement however, warned that the outlook remained vulnerable to the still fragile security situation, climate shocks and the nascent institutional capacity. The country, it was felt, needed to improve economic resilience and generate jobs and reduce poverty. Meanwhile, global agency FAO has warned that the drought in Somalia could leave some 2.2 million people — nearly 18 percent of the country’s population — in severe hunger during the July-September period.
