The World Bank Board of Executive Directors has approved a significant $125 million USD Development Policy Financing (DPF) grant for Somalia, marking a major boost for the nation’s economic reform and development efforts. The decision, announced on Wednesday, is aimed at supporting Somalia’s economic priorities, including domestic revenue enhancement, public financial management, and private sector growth.
Somalia’s Finance Minister, @BihiEgeh, expressed gratitude for the timely assistance, highlighting its importance for the country’s development agenda. “We are grateful to the World Bank Board of Executive Directors for approving the $125 million USD Development Policy Financing grant today. This financial assistance is timely and will support advancing Somalia’s economic reform priorities, including boosting domestic revenue, strengthening public financial management, enhancing debt management, and supporting private sector development,” Bihi posted on his official X account.
The grant, provided by the World Bank’s International Development Association (IDA), marks the introduction of drought index insurance for 180,000 pastoralists in Somalia, including 90,000 women. This initiative aims to provide vital support to those most affected by climate change, particularly in climate-vulnerable sectors like agriculture, fisheries, and micro-businesses.
The funding is the first in a series of two programmatic operations designed to boost revenue, improve debt management, and enhance accountability in public spending. Additionally, the program will facilitate access to microfinance for lower-income groups and promote climate-smart investments, including expanding access to greener and more affordable electricity and supporting fisheries development.
Established in 1960, the IDA helps the world’s poorest countries through grants and low to zero-interest loans, focusing on projects that drive economic growth, reduce poverty, and improve lives. The new grant is expected to play a crucial role in financing essential public services and driving sustainable development in Somalia.
Mustaqbal
