IMF - Somalia Country Fund IMF - Somalia Country Fund Support to IMF for capacity development assistance to Somali institutions to strengthen macroeconomic stability, increase quality of financial statistics, strengthen the central bank, improve tax policy and public financial management. Stöd till IMF för kapacitetsutvecklingsinsatser till somaliska myndigheter för att stärka makroekonomisk stabilitet, öka kvalitet på finansiell statistik, stärka centralbanken samt förbättra skatteadministration och offentlig finansiell styrning, Goals

• Developing an adequate macroeconomic framework for policy formulation and implementation in line with Somalia's IMF program.
This framework would aim to include annual quantitative estimates and projections of economic activity, public revenue and expenditure, balance of payments flows, and monetary variables, as well as a medium-term fiscal framework.

• Enhancing the capacity for the production of macroeconomic statistics.
The focus will be on improving the production of monetary, fiscal, external sector (balance of payments), as well as national accounts and price data in line with international standards.

• Improving central bank organization and operations.
The primary objective is to provide technical input and hands-on training to central bank staff for capacity development in central banking (i.e., establishing and organizing core activities such as monetary and foreign exchange operations, foreign reserves management, accounting, reporting and control, research and statistics, and institutional governance).

• Strengthening financial stability, supervision, and regulation.
The objective is to provide the technical input and hands-on training to improve (i) financial sector supervision and regulation, and (ii) policies and institutions related to anti-money laundering and combating financing of terrorism.

• Strengthening public financial management, public debt management, and public investment management.
The key goal is to help strengthen PFM reforms to support fiscal stability, accountability and oversight. This includes providing strategic advice and assisting in the coordination of macroeconomic reforms in areas such as budget planning and preparation, expenditure control and cash management, and financial oversight and audit. This also includes supporting the efforts on fiscal federalism to ensure a broader assessment of the country's revenue and expenditure capacity. It would also include helping establish the capacity to manage public investments and building debt management capacity to help the authorities sustain debt sustainability post-HIPC Completion Point. More broadly, this would also include advice on securing fiscal space to support critical interventions in line with the authorities development priorities as outlined in the National Development Plan and to underpin economic resilience (as outlined in the underlying Recovery and Resilience Framework).

• Improving tax and customs policy and administration.
The focus will be on operationalizing the recently signed Revenue Law and helping broaden domestic revenue mobilization efforts to the Federal Member States (FMS). This includes enhancing revenue administration and capacity building in the fiscal regimes for the utilization of natural resources.

Objectives and outcomes

Sector: Public Financial Management
- Comprehensive, credible, and policy-based budget preparation
Outcome: A more comprehensive and unified annual budget is published

- Improved budget execution and control
Outcome: Budget execution and controls are strengthened

- Improved coverage and quality of fiscal reporting
Outcomes: i) Comprehensiveness, frequency, and quality of fiscal reports is enhanced ii) The chart of accounts and budget classifications are aligned with international standards


Sector: Revenue Administration
- Improved customs administration functions
Outcome: Customs control during the clearance process more effectively ensures accuracy of declarations

- Strengthened core tax administration functions
Outcomes: i) A larger proportion of taxpayers meet their filing obligations as required by law ii) Audit and other verification programs more effectively ensure accuracy of reporting iii) The integrity of the taxpayer base and ledger is strengthened

- Strengthened revenue administration management and governance arrangements
Outcome: Support functions enable more effective delivery of strategy and reforms


Sector: Tax Policy
- Improved tax and non-tax revenue policy
Outcomes: i) Improved structures and capacity related to tax policy advice and analysis, including organization of tax policy units and building tax models or other tools for analysis and revenue forecasting ii) Increased economic efficiency by minimizing the economic distortions imposed by taxes or by using taxes to address externalities or market failures


Sector: Central Bank Operations
- Adopt the International Professional Practices Framework (IPPF) of the Institute of Internal Auditors as the central banks risk-based Internal Audit framework
Outcome: Diagnostic of critical deficiencies relative to compliance with IPPF completed

- Enhance the central banks decision-making capacity and internal organization
Outcome: The central bank has effective decision-making body/bodies

- Strengthen efficient implementation of monetary policy under the existing regime
Outcome: The central bank has an operational strategy


Sector: Financial Supervision and Regulation
- Develop/strengthen banks regulation and supervision frameworks
Outcomes: i) Clear supervisory process to review licensing applications in line with required criteria implemented. ii) Legislation/prudential regulations on capital adequacy developed/strengthened, including maintaining adequate capital structure composed of high capital instruments in line with Basel II/III iii) Legislation/regulations on liquidity developed/strengthened including maintaining adequate liquidity positions to withstand crises and shocks in short-term and to retain stable funding resources to finance their longer-term assets. 

- Develop/strengthen regulatory framework and supervisory tools to address specific risks in Islamic banking
Outcome: Prudential framework for IIBS developed/strengthened.

- Implement a risk-based supervision (RBS) system and upgrade other supervisory processes
Outcome: Supervisors have sufficient capacity to effectively implement risk-based supervision and other supervisory processes


Sector: External Sector statistics
- Strengthen compilation and dissemination of external sector statistics
Outcomes: i)Source data are adequate for the compilation of these macroeconomic statistics. ii) Staff capacity increased through training, especially on developing source data, compilation methods, and dissemination


Sector: Financial Institutions statistics
- Strengthen compilation and dissemination of financial Institutions statistics
Outcomes: i) Improved data and metadata accessibility ii) Source data are adequate for the compilation of these macroeconomic statistics

- Strengthen compilation and dissemination of financial soundness indicators
Outcome: A new data set has been compiled and disseminated internally and/or to the public


Sector: Government Finance statistics
- Strengthen compilation and dissemination of Government Finance Statistics
Outcomes: i) Methodological basis for the statistics follows internationally accepted standards, guidelines, or good practices.
ii) Staff capacity increased through training, especially on developing source data, compilation methods, and dissemination.
iii) Statistical techniques are sound


Sector: Real Sector - National Accounts statistics
- Strengthen compilation and dissemination of real sector statistics - national accounts 
Outcomes: i) A new data set has been compiled and disseminated internally and/or to the public ii) Source data are routinely assessed (for coverage, sample error, response error, and non-sampling error) and assessments are monitored and made available to guide statistical processes iii) Staff capacity increased through training, especially on developing source data, compilation methods, and dissemination