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Laboratoire de la finance africaine

Somalia

Aperçu 2022
Annual current GDP growth (%) : 3.2
GDP (USD billions) : 5.888
Population (Thousands) : 15.931 
Economic performance and outlook

Somalia was affected by several shocks during 2019 and 2020—drought, floods, locust invasions, and the COVID–19 pandemic. As a result, real GDP, which grew 2.9% in 2019, shrank by 1.5% in 2020, mainly because of COVID–19 containment measures such as travel restrictions and supply and value chain disruptions. Growth has also been affected by reduced foreign direct investment, as investors shied away during contentious elections that were postponed, a shrinkage in remittances because of the global recession, and bans on livestock exports by the Gulf countries. Financial sector development is still nascent and there is no scope for monetary policy because of dollarization and currency counterfeiting. Annual inflation was estimated to decrease to 4% in 2020 from 4.7% in 2019, due to tax relief on food essentials and improved food supply. The Somali shilling remained relatively stable, depreciating by less than 1% between January and November 2020 as widespread dollarization reduced the supply of counterfeit currency. A structural trade deficit persists; exports continue to lag imports. Lower exports and reduced net financial inflows are expected to aggravate the current account deficit in 2020, estimated at 12.8%. Seven of 10 Somalis survive on less than $1.90 per day, and the COVID–19 crisis has likely increased poverty, as the 4.4% decline in real per capita income would suggest. (Download detailed Analysis Source : Report African Economic Outlook 2021 ; AfDB)