World Bank Group supports public private dialogue to spur economic recovery in Somalia
The Somali government and high level business actors have endorsed a Public-Private Cooperation Agreement to Accelerate Somalia’s Economic Recovery.
The Agreement is a combination of priority actions, principles and processes for delivery of economic priorities, and a commitment from development partners to align their focus to Somalia’s new National Development Plan 2017-2020.
His Excellency Mohamed Abdullahi “Farmaajo”, President of the Federal Republic of Somalia recognized the importance of creating the right conditions for investment: “Our Government needs to provide the right governance environment for the private sector to grow, and provide jobs to our people. My Government and I are committed to strong collaboration between the public and private sector, as well as our development partners, to create a new, irreversible chapter in the economy of our country”.
In her opening remarks, Bella Bird, World Bank Country Director for Tanzania, Malawi, Burundi and Somalia, said ““The current drought has amplified Somalia’s vulnerability and the urgent need for investments to enable full economic recovery and lay the foundations for future prosperity. This event has identified clear areas of priority investment where the public and private sectors can work together to accelerate economic progress among them: energy; water and financial services. We congratulate both the government and private sector.”
Somalia faces a disastrous drought and is constrained by limited state and institutional capacity. Nevertheless, the Somali private sector has remained vibrant and contributes over 90% of GDP, including through remittance flows of around USD 1.5 billion per annum.
The ICT sector makes up a significant portion of private sector activity, providing the continent’s cheapest phone rates, full domestic mobile network coverage, an expanding 4G network, and more mobile money transfers than cash transactions. President Mohamed’s newly-elected administration has expressed a commitment to engaging with Somalia’s vibrant private sector, both locally and in the diaspora, to support the country’s next stage of development.
Cheick Oumar Seydi, Director for Africa, International Finance Corporation, said “Officially recognizing private sector’s resilience and key role in Somalia is a major milestone.
IFC will apply its knowledge and extensive global networks to support Somalia’s government and private sector in their efforts towards economic recovery. The World Bank Group is already working to improve government to business services, which will help the private sector formalize and access global markets”.
Participants in the dialogue discussed priorities for Somalia’s recovery, which are identified in the country’s National Development Plan, as well as continuing the public private dialogue (PPD) process with support from the World Bank Group and other partners.
During the dialogue, private sector representatives highlighted the business opportunities in Somalia as well as the challenges such as insecurity, weak government capacities, an informal financial sector; need for currency reform, effective fiscal policies and public sector accountability.
“The Government affirms its responsibility to develop and strengthen regulatory frameworks and policies, in consultation with the private sector, to enable private sector led economic recovery that benefits all Somalis. The Private Sector will actively engage with the government to progressively establish a modern business environment based on rule of law and a fair, predictable and competitive taxation system”, said Mohamed Abdullahi Abdi “Martello”, Spokesperson for the Somali Chamber of Commerce and Industry.