Somali Finance Ministers Reach Agreement on Key Financial Issues

Published: August 14, 2023

A meeting of the Ministers of Finance of the Federal Government and the Member Governments of the Federal Government and the Banadir Regional Government concluded in Mogadishu on Saturday. The ministers focused their meeting on the development of the country’s financial system, raising domestic revenue, debt relief and the allocation of the World Bank’s budget support grant (DPO), and they reached an agreement on the following points:

  • Approving the recommendation of the technical committee on the unification of the direct tax (income tax bill). The conference fully agreed on the unification of the vertical tax. It was also agreed to speed up the approval of this bill before 2024, to implement the 2024 annual budget allocation of the Federal Government, Member States.
  • Unification of the Tariff of the ports of the country. It has been agreed that the country will have a single tariff rate that will be implemented throughout the country as soon as possible and the technical committee has been assigned to make recommendations.
  • World Bank Funds Sharing (DPO-2). The meeting was presented with the self-assessment report of the Member States of the Federal Government (MSFG)) and the results of the review of those reports, while the accuracy of the (Income Standard) was confirmed by the Office of the Accountant General. It was agreed to share the available budget subsidy based on the procedure mentioned in the agreement of January 11, 2023.
  • Internal Audit. The head of the Internal Audit Department of the Ministry of Finance, FGS, gave a report on the preventive activities of the internal audit and the need to strengthen the quality of work and duties of the internal audit (Internal Audit). It was agreed to create a sub-committee responsible for internal investigations within the Technical Committee on Financial Federalization.
  • Project SERP. The meeting was briefed on the progress of the SERP project and when it is expected to be fully operational, while agreeing to expedite the completion of draft procedures and procedures as soon as possible. It was also agreed that the inauguration of the project will be held in September 2023.

Puntland was absent from the conference and has not participated in all the recent meetings, after a dispute between the federal government and Puntland which has not yet been resolved.

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