Regulatory Alerts2025-09-01
Post-Debt Relief Reforms in Somalia: Monitoring IMF Debt Sustainability
The Central Bank of Somalia issued this policy brief to outline post-HIPC fiscal reforms required to maintain debt sustainability following the nation's December 2023 debt relief milestone. The document highlights that while external debt has dropped below six percent of GDP, Somalia faces moderate distress risk due to exceptionally low domestic revenue, high recurrent expenditures, and heavy donor dependence. To preserve these gains, the Central Bank mandates expanded tax base development, strict non-concessional borrowing limits, institutionalized debt management, and prudent natural resource revenue governance.
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