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MOGADISHU, June 24 (Xinhua) -- The World Bank
has approved a 55 million U.S. dollar grant to
support Somalia's
economic recovery through continued fiscal and other economic policy
reforms.
Hugh Riddell, World Bank country manager for Somalia, said the
policies will strengthen fiscal management and promote inclusive private
sector-led growth.
"The budget support will help protect lives and livelihoods and
strengthen the capacity of Somali institutions to respond to the triple
crisis of COVID-19 pandemic, locust invasion and flooding that threatens
to derail Somalia's reform program and its emergence from fragility,"
Riddell said in a statement issued on Wednesday.
The supplemental financing helps Somalia ease the effects of the
global COVID-19 crisis and continue implementing the reform program
supported by the Somalia re-engagement and reform supplemental
Development Policy Financing (DPF).
According to the lender, the DPF delivers critically needed financing
for Somalia's revised 2020 budget, which allocates funds for an
integrated and national response to the pandemic, including increased
grants to sub-national governments to ensure continued service delivery.
Somali finance minister Abdirahman Beileh said the revised budget
expands cash transfers to vulnerable households and provides a
substantial increase in grants to sub-national governments to help them
respond to the pandemic in the face of declining revenue.
"The supplemental financing will help in plugging our public
expenditure gap, given the 29 percent domestic revenue shortfall and 2.5
percent GDP contraction in 2020," Beileh said.
In March, the World Bank and the International Monetary Fund approved
Somalia's eligibility for the Heavily Indebted Poor Countries
Initiative, removing the constraints on economic growth and poverty
reduction and providing access to instruments to mitigate the impact of
multiple crises in Somalia.
Decades of conflict and state fragmentation have left Somalia's
public health system constrained and unable to mount an adequate,
timely, and effective response to manage the COVID-19 crisis.
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