The IMF provides Somalia with $ 970,000 in temporary assistance under the HIPC initiative
MOGADISHU, Somalia – At the request of the Federal Government of Somalia, the Executive Board of the International Monetary Fund [IMF] has provided additional temporary assistance to the country under the improved heavily indebted poor countries [HIPC] Initiative.
According to the statement from the global lender, Somalia received $ 0.97 million over time. This comes amid the country’s efforts to clear debt, some of which date back to the 70s and 80s under Siad Barre’s regime.
The temporary assistance, the IMF noted, will cover Somalia’s debt obligations to finance for the period from 25 March 2021 to 24 March 2022. This is a period of one year and is considered one of the best practices in the world by Borrowing.
On 25 March 2020, the Executive Board approved that Somalia had reached the HIPC decision point. At the same time, the Board of Directors approved three-year plans under the expanded credit facility [ECF] and expanded fund facility [EFF].
The Board of Directors also approved temporary assistance of DKK 1.11 million. SDR [about US$ 1.5 million] for the period 25 March 2020 – 24 March 2021. The first ECF review was completed on 18 November 2020.
The results of the ECF-supported program have been satisfactory and Somalia continues to make progress on debt restructuring and other reforms needed to reach the HIPC completion point. The request was made by Somalia’s Finance Minister Abdirahman Duale.
Temporary assistance under the extended HIPC initiative is debt relief provided to a country’s debt service falling between the HIPC decision and completion points. When a country reaches the HIPC completion point, it will receive the full debt relief committed at the HIPC decision point.
AXADLETM
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