The International Monetary Fund (IMF) has approved a new disbursement of \$10 million for Somalia.

The funds are part of Somalia’s ongoing economic reform program supported by the Extended Credit Facility (ECF).

This brings Somalia’s total disbursement under the ECF to about $70 million since December 2023. The money will support the government’s budget and reform efforts.

The IMF praised Somalia for staying on course despite tough global and domestic challenges. The Fund said Somalia’s reform momentum remains strong.

Deputy Managing Director of the IMF, Nigel Clarke said the new National Transformation Plan of Somalia offers a clear path to long-term growth and poverty reduction.

“The plan provides a welcome medium-term reform agenda to build resilience, promote inclusive growth, and reduce poverty,” he said.

Clarke said there is a need to strengthen domestic revenue mobilization to create room for social and development spending.

“The government must create more space for social and development spending,” he said.

Recent gains in revenue collection were welcomed by the IMF and encouraged continued efforts to modernize customs and enforce the new Income Tax Law.

It also urged Somalia to improve debt and financial management.

Reforms in public service, including a new pension system and Pay and Grade changes, as well as Progress at the Central Bank should be handled with care, the Fund said.

Clarke urged further financial inclusion and support for reintroducing the Somali Shilling under a currency board system.

He praised new laws to improve governance in the petroleum sector, calling them a milestone. But he said more anti-corruption reforms are still needed.

The IMF said continued support from development partners remains vital for Somalia’s recovery and long-term success.

Somalia’s economic outlook is clouded by foreign aid disruptions, weather shocks and high uncertainty, with 2025 growth expected to slow to 3 percent from an estimated 4 percent in 2024.