The Board of Directors of the World Bank (WB) has approved a second round of Development Policy Financing (DPF) in favor of the Federal Republic of Somalia. This support, in the amount of 125 million dollars, is granted in the form of a grant by the International Development Association (IDA)

This grant aims to promote economic resilience through more sustainable public finances and the development of a competitive private sector that can absorb shocks.

The DPF will facilitate reforms aimed at strengthening the sustainability of public finances, in particular by increasing tax revenues and improving the efficiency of spending. The aim is to lay the foundations for sustainable financing of development and to reduce the country's dependence on external aid.

The transaction will also promote increased investments in renewable energies and improved access to electricity, with the aim of reaching 50 MW of renewable energy capacity by December 2026.

With regard to the private sector, the DPF will in particular support the development of microfinance and drought insurance, by simplifying access to finance for women who do not have a bank account, thus contributing to gender equality.

“These reforms aim to improve the efficiency, transparency and accountability of public institutions, creating an environment conducive to private investment and job creation,” said Hideki Matsunaga, World Bank Operations Manager for Somalia.