NEW YORK, April 16, 2013 — The International Monetary Fund (IMF) recognition of Somalia on Friday after a 22 year break is a major milestone, but the terrorist attack on the county’s Supreme Court complex Sunday is a reminder that tangible assistance is needed to have lasting peace.
Nine men, a team of suicide bombers and shooters, killed at least 35 people and wounded 60 others on Sunday in Mogadishu, Somalia’s capital. Al-Shabaab, the local al-Qaeda-linked militant group, claimed responsibility for the violence. This incident is viewed as the worse assault since 2011 when al-Shabaab was driven out of Mogadishu. All nine attackers are reported dead, but this will not be end of Al-Shabaab’s assaults.
Recognition by the IMF signals economic progress, but the economy remains a fragile target for al-Shabaab. The IMF can now offer Somalia technical assistance and policy advice, but not funding. The nation is currently ineligible for an IMF loan due to its outstanding arrears of $352 million. The government expects a budget deficit of over $30 million, not considering the $2.2 billion dollars of external debt it carries according to 2010 data from the World Bank. The agricultural based economy is not equipped to clear its IMF debt or any of its external financial obligations.
Somalia only recently removed its label as a failed state, in September 2012, when it established a federal government and Hassan Sheikh Mohamud won the presidency in a legitimate election. The country had not had a government since 1991 when the regime of General Mohammed Siad Barre was overthrown and competing militia groups developed autonomously ruled regions. The new government has received public acknowledgment from the United States, the United Nations, the African Union, the European Union, and the Organization of Islamic Cooperation.
Somalia defense is dependent on African Union peacekeepers, but stability for economic progress requires a long term solution. The government needs financial assistance to aggressively build its own defense, which includes funding for hiring, training and paying Somali security forces.
President Barack Obama last week issued a memo to Secretary of State John Kerry which directed him to begin the process of wielding security assistance to Somalia. The memo stated that Somalia is eligible for “defense articles and defense services” under the Foreign Assistance Act and Arms Export Control Act.
The United Kingdom, as part of its G8 Presidency, is leading discussions to clear all of Somalia’s arrears owed to the IMF, the World Bank and the African Development Bank. Somalia is £459 million ($701 million) in arrears according to the British Foreign Office. If the U.K. succeeds, then the IMF and other international financial institutions (IFIs) can begin lending to Somalia.
If funding from IFIs and/or U.S. military aid becomes available, Somalia would only be able to buy light weapons. In March, the UN Security Council partially lifted the arms embargo against the country for one year. The embargo was established in 1992 to keep warlords from gaining weapons and the UN wants to slowly remove this ban as the new government matures.
Global powers support Somalia, but the nation needs to stay ahead of oppositional forces that seeks to undermine the seven month old government. President Mohamud must present his case to the world stage for immediate and substantial financial assistance to fast track Somalia’s ability to defend itself and rebuild its economy.
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