Somalia finance ministers meet to strengthen economic cooperation

Finance ministers from the Federal government of Somalia, Federal Member States, and the Banadir Regional Administration met to strengthen the country’s economic cooperation.

The ministers led by Finance Minister Bihi Egeh met in Mogadishu for a three-day Finance Ministers Fiscal Forum, (FMFF) that came to a close on Monday.

The forum focused on key elements essential for enhancing the Public Financial system and promoting cooperation among the different levels of government.

During the forum, the ministers agreed on five key areas, which they also adopted jointly by Bihi, and the finance ministers from regional governments of Jubbaland, Hirshabelle, South-West, Galmudug, and the Banadir regional administration.

The agreements reached at the FMFF included honouring the decisions and agreements made during the 18th FMFF meeting regarding grant sharing formula.

The meeting also resolved to implement a unified Taxpayer Identification Number with a 12-digit number that will specify the type of taxpayer (individual, business, or organization).

“The forum reviewed a proposal from the Chairman of the Technical Committee on Fiscal Federalization (IGFFTC), highlighting findings from the 16th FMFF meeting,” a joint statement after the meeting reads.

The forum's outcomes, the statement added signify a concerted effort toward strengthening financial systems and fostering cooperation across Somalia's governmental structures.

The forum also addressed the report and proposals related to the Recurrent Cost and Reform Financing (RCRF) Project.

The participants were briefed on the progress of reviewing the political agreement concerning the revenue assignment and the functional responsibilities among different levels of government.

This included assessing whether the adopted assignments and responsibilities are implementable vis-à-vis the government’s respective capacities.

The agreements had previously been adopted during the National Consultative Council (NCC) in March 2023 and December 2022.The meeting also explored proposals outlining new strategies adopted under the RCRF-III, 2nd Additional Financing project.

It was agreed that a special meeting would be convened to address potential challenges associated with this new implementation process.

The meeting aims to enhance intergovernmental relations, promote transparency, and ensure equitable resource allocation.

“This lays a solid foundation for sustainable growth and development.

“By implementing a formula-based approach to grants, the forum promotes equity and accountability, addressing historical disparities in resource allocation that have hampered regional development.”