Somalia Back in the Favor of the IMF after More than Two Decades

After 22 years, the International Monetary Fund (IMF) has recognized Somalia, opening doors for this poor country located right at the Horn of Africa. This recognition from the IMF means that the organization is now available for advice and help now that a legitimate administration is in place and the civil war is finally over, Somalia is starting over.

Rebuilding a nation

Two decades of conflict has left the federal government of Somalia in disarray. President Hassan Sheikh Mohamud is leading a nation that is in the process of healing itself. The country is in the process of rebuilding and reforming amidst insurgency from Islamist militants. In 1991 warlords ousted Mohamed Siad Barre, a military dictator which sparked twenty years of civil war.

The federal government of Somalia is now recognized by the international community as well. The United Nations (UN), the European Union (EU), and the African Union have expressed full support to the just instituted Somalian federal government. The Organization of Islamic Cooperation also fully supports President Mohamud’s administration.

The new government has been officially recognized by the United States in January of this year. The “Black Hawk Down” incident in 1993 which saw the death of 18 American servicemen from militia fire caused a major rift between the two nations.

Outstanding debt

But at this time, Somalia is not yet eligible for a monetary loan because it still has to pay off a $352 million in outstanding debt. Although Somalia has been a member of the IMF since 1962, the years of civil war left it without a government. As a consequence, the IMF had no one to deal with. Just last year, an election was conducted – the first in a very long time, and President Mohamud was elected by the majority. His government took effect in September 2012.