African Development Bank Undertakes mission to Somalia to assess portfolio and implementation of development objectives

The African Development Bank has concluded a three-day mission to Mogadishu, Somalia in  preparation for completion of the country’s Interim Country Strategy Paper (I-CSP) 2022-2024 and annual Country Portfolio performance review.

The Bank team participants in the visit,  which took place from 26^th to 28^th  March 2024, sought to discuss implementation of the Bank’s strategy for the country, assess the Bank’s portfolio performance, and to draw lessons for the design of the new Country Strategy Paper for 2025-2029.

The Bank delegation was led by Bubacarr Sankareh, Lead Operations Advisor to the Director General for East Africa and Edward Sennoga, Lead Economist for the region. In addition, Dr. Yero Baldeh, Director of the Bank’s Transition States Coordination Office joined the team for the visit.

The delegation held meetings with representatives of the government and various ministries including the finance minister, Bihi Egeh, Planning, Investment and Economic Development minister and officials from the ministries of agriculture and Irrigation; Fisheries and the Blue Economy. They also met representatives of the Women and Human Rights Development, Transport and Civil Aviation, and Somalia’s Development and Reconstruction Bank.

With sustainable development in Somalia being hindered by conflict and insecurity, governance shortfalls, institutional capacity weaknesses, infrastructural deficits, low human capital, poverty and economic inequalities, climate change impacts, and forced displacement, the main objective of the Bank Group’s strategy 2022-2024 is to support the Somali government to address the core drivers of fragility and to foster high and inclusive growth, and economic resilience.

“Among the key targeted areas of national focus to grow our economy under the National Transformation Plan are creating a conducive environment for investment, attracting more financing for climate resilient infrastructure and energy, strengthening food security through investment in the productive sector and supporting our entrepreneurial people to benefit from Somalia’s strategic location,”  Egeh noted. “We very much hope that this guides the upcoming Bank Country Strategy Paper from 2025”, he added.

The 2022-24 Strategy focuses on two Priority Areas - development of quality and sustainable infrastructure for a resilient economy and capacity building for a stronger state and inclusive economy.

During the visit the Bank delegation presented six priority reform areas for the government’s attention:  addressing macroeconomic imbalances to achieve macroeconomic stability; reducing vulnerability to climate risks and implementing actions for just energy transition; enhancing the enabling environment for private sector investment and growth; improving infrastructure to reduce costs of doing business, enhance competitiveness and bolster inclusive growth; modernizing the agriculture sector to bolster resilience and harnessing the blue economy to accelerate economic diversification; and deepening regional integration and economic cooperation.

These will complement the roles played by Somalia’s vibrant private sector, diaspora remittances, development aid, humanitarian assistance, security sector reform and cooperation in building resilience.

The Somali authorities commended the Bank for its continued support to the country’s National Transformation Plan, designed to promote socio-economic growth in Somalia, improve peace and security, and advance governance reforms.

The Bank’s ongoing portfolio in Somalia comprises 17 operations with a total commitment of UA 167.4 million (approximately US$ 221.61 million) spanning the transport sector (45%), agriculture sector (27%), multi-sector including economic and financial governance (11%), water and sanitation sector (10%), power sector (4%), and social sector (3%). Challenges affecting portfolio implementations were discussed and proposed remedial actions will be captured in the 2024 Country Portfolio Improvement Plan.