World Markets

Somalia economic growth likely to inch up this year, World Bank says

Credit: REUTERS/FEISAL OMAR

Somalia's economy is expected to grow by 2.9% this year, from 2.8% last year, before growth quickens to 3.2-3.5% in the medium term, the World Bank said on Monday.

NAIROBI, Sept 9 (Reuters) - Somalia's economy is expected to grow by 2.9% this year, from 2.8% last year, before growth quickens to 3.2-3.5% in the medium term, the World Bank said on Monday.

The Horn of Africa country has been in turmoil since 1991, when clan warlords overthrew President Siad Barre and then turned on each other. Over the past decade it has been hit by famine and sporadic terror attacks by al Qaeda-linked militant group al Shabaab.

The higher growth forecast for the next three-to-five years would depend on the country being able to sustain its current economic reform momentum, the World Bank said in a statement.

Tax collection by the government increased by 29% last year, as the economy recovered from a drought the previous year and the government changes its tax policies, the World Bank said.

"While this progress is encouraging, the available fiscal space remains insufficient to meet expenditure needs (for) education and health sectors," the bank said.

It asked the government to form a fund dedicated to education to allow authorities in Mogadishu to mobilise more cash from regional states and other partners to support learning.

In May, the International Monetary Fund said Somalia's economy was on the right track but warned that it was still vulnerable to fragile security, climate change and poverty.

(Reporting by Duncan Miriri; Editing by Toby Chopra)

((duncan.miriri@thomsonreuters.com; Tel: +254 20 4991239; Reuters Messaging: duncan.miriri.thomsonreuters.com@reuters.net))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Latest World Markets Videos

    China Tension Won't Derail Equity Markets, State Street Says

    The escalating tension between the U.S. and China is unlikely to derail the equity markets, according to State Street's Benjamin Jones. "The risk-on, risk-off story is still very much dominated by Covid," he said on Bloomberg.

    Jul 24, 2020

    Reuters

    Reuters, the news and media division of Thomson Reuters, is the world’s largest international multimedia news provider reaching more than one billion people every day. Reuters provides trusted business, financial, national, and international news to professionals via Thomson Reuters desktops, the world's media organizations, and directly to consumers at Reuters.com and via Reuters TV.

    Learn More