'Arab-brother nations' leading the way on Somalia's debt relief
'Arab-brother nations' leading the way on Somalia's debt relief
Arab League nations are set to cancel Somalia's debts to help it fight its major development and security battles, Somalia's president has said.
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Some of the world's biggest leaders have arrived in London for the conference [AFP]
Arab League nations are helping Somalia achieve its future potential by cancelling their debt burdens, the president of Somalia said on Thursday.
Somalia's development problems can only be solved by better security solutions, requiring more and better financing, President Mohamed Abdullahi, also nicknamed "Farmaajo", said at a London conference on Somali development.
"A number of Arab States are prepared to forgive their loans and we are grateful to our Arab brothers and sisters for this," said President Farmaajo.
Debt relief of this kind is considered essential by many international development agencies and NGOs if Somalia is to ever develop over the long-term.
"Restoring Somalia's relations with the World Bank, cancelling the country's debt, and providing immediate financial support from the World Bank's international development association facility is critical," said Kevin Watkins, CEO for Save the Children in a recent press release.
The new federal government in Somalia is working with the World Bank and the International Monetary Fund (IMF) to "meet its obligations" and increase funding for its national security program.
Several countries and organisations, including the United States, the United Kingdom, African Union, United Nations and European Union are all expected to announce an increase in spending on Somalia at the conference where more than 40 government delegations are in attendance.
The Somali army and police force require better training and unified training programs in order to help defeat the country's Islamist Jihadist rebels, al-Shabaab, the UN Secretary General Antonio Guterres said during the London event's opening session.
"A Somali-led security force is the foundation on which Somalia will succeed and AMISOM [the African Union Mission to Somalia] cannot be expected to carry the burden any longer," said Guterres.
Somalia's external debt stands at around $5.3bn (£3.9bn) - roughly equivalent to 80% of its GDP.
Much of this debt was inherited from the 1970s when ex-dictator Siad Barre splurged on massive military and infrastructure contracts.
It is not thought that Somalia will be able to repay the majority of these loans, as it currently lacks a centralised tax system and faces a major problem addressing federal corruption.
In 2015, it was estimated by one security company that official corruption accounted for 86% of Somalia's national budget going missing.
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