Friday April 1, 2022
Mogadishu (HOL) - Senior Somali government officials have told HOL that the government may not be able to pay salaries for the civil service and armed forces in May 2022 because of the delayed election process and lack of enough domestic revenue collection.
The Somali federal government spends over 85.9% of its total budget on salaries, allowances and other operational costs. However, the officials said there is a shortfall between government revenue and expenditure.
The insiders claim that the government's domestic revenue is not enough to cover the cost of salaries and the government's running costs in May without international budget support assistance. Budget support assistance for Somalia by Somalia's donor countries has been suspended because of the consistent delays in the electoral process which goes on to this day. However, experts forecast that Somalia needs around $22-million more to pay for its critical public expenditure.The prospect of not being able to pay the salaries of the civil servants and armed forces will breach one of the critical conditions of the IMF debt relief programs, which is to not get into any more debt.
The international community, Somalia's partners in the economic reform, has recently warned that Somalia could lose everything it has gained in the economic reform program 'if the election process is not completed and political harmony and peaceful transfer of power not made possible'. These renewed warnings make it almost inevitable for the Somali government to miss the review of the IMF program deadline in May 2022.
If the government cannot pay the salaries of its civil servants and security forces, it could create enormous challenges at a time of rising inflation and cost of living hardships.
Somalia was dependent on donor funding, with local revenue accounting for less than half of the country's yearly budget. The EU withheld funding amid fallout from delayed elections.
The Minister of Finance, Abdirahman Duale Beileh himself, in his recent interview with the African Report Magazine, has echoed the same sentiment that if the election is not completed in time, Somalia's economic reform efforts could be put at risk.