Thursday December 14, 2017
Somali Parliament on Wednesday endorsed a 247-million-U.S.-dollar budget for 2018 to fund the conflict-torn country's national recovery.
Majority of the lawmakers present in the House passed the budget that will fund key development projects and pay for civil servants salaries and the military.
Finance Minister Abdirahman Beileh hailed the House approval as crucial to allow the government to meet its development priorities.
"This is a great achievement for the government as we can now focus on delivering on some of our development projects," said Beileh.
The move comes after the International Monetary Fund (IMF) said Tuesday Somalia's economy would grow at 2.5 percent rate in 2018 as the country recovers from a drought that has resulted in major livestock and crop losses.
The IMF said besides the drought, terror attacks in the country has forced the country's economy to stagnate in 2017, growing at a 1.8 percent.
In the budget, Somalia is levying 30 dollars for local and international passengers entering and leaving the country as it seeks to boost domestic revenue. This is an increase from this year's 20 dollars.
The trade deficit is projected to remain high, reflecting increased food imports and lower exports, and will be largely financed by grants and remittances.
"Sustained support by the international community has helped avoid a severe humanitarian crisis in 2017. As the drought started receding, growth is expected to recover to 2.5-3.0 percent and inflation to decline to 2.0-2.5 in 2018-19," it said.
Mohamad Elhage, who led the IMF team that held talks with Somalia authorities in Nairobi, said the drought and sporadic terrorist attacks in 2017 took a toll on economic activity.
"The drought has hurt the economy and temporarily impacted the government's tax collection efforts. These developments offset a steady recovery in the service sector, including in the telecommunication and transportation sectors," he said.