Somalia's battered economy to grow 2.5 percent in 2018, IMF says

NAIROBI - Somalia’s economic growth is expected to pick up next year and in 2019 after drought and security issues cut growth this year, the International Monetary Fund said on Tuesday.

The fund said the economy was forecast to expand by 2.5 percent in 2018 and 3 percent in 2019, while inflation was seen falling to the range of 2.0 to 2.5 percent in the same period.

IMF projects Somalia’s economy to grow 1.8 percent this year -- lower than its February forecast of 2.5 percent -- compared with 2.4 percent in 2016.

“In 2017, the drought and sporadic terrorist attacks took a toll on economic activity. The drought has hurt the economy and temporarily impacted the Federal Government of Somalia’s tax collection efforts,” IMF said in a statement.

“These developments offset a steady recovery in the service sector, including in the telecommunication and transportation sectors.”

Somalia has been in turmoil since 1991, hit by decades of conflict at the hands of clan militias. Over the past several years it has also been hit by an insurgency by al Qaeda-linked al Shabaab, famine, and maritime piracy.