APEEJAY SCHOOL OF MANAGEMENT

INTERNATIONAL FINANCE
TERM-V
UNIT-II
ASSIGNMENT-1(B)
Chart: Changing to a Free-Market Economy
Name: Rishibha Singla Roll No: 28/069

Country Analysis: Assigned Country: Somalia (developing country) / Date of Membership with IMF:
August 31, 1962

Use this chart to help you organize your findings as you research the (IMF Center)
http://www.imf.org/external/np/exr/center/index.htm
exhibit for information about your country's transition to a market economy. Keep track of the events and
conditions that have had an impact on your country: consider and record how results seem to have affected
the economic situation, political climate, and social conditions of the nation and the individuals involved.

PARTIES DATE(S) COUNTRY'S ASSISTANCE RISKS/COMPROMISES OUTCOME

INVOLVED PROBLEM(S) SOUGHT/RECEIVED
IMF Executive Feb 13, 2020 Reduce Poverty in Somalia Eligible for Right now Somalia is in heavily debt Helping Somalia achieve
Board and Somalia and make it Assistance Under the situation. debt relief and unlock
Somalia debt relief. Enhanced Heavily Facing Poverty issues because of access to the needed
Indebted Poor Countries weak economy. resources to increase
(HIPC) Initiative. growth and reduce
Agreement by the IMF poverty is a key priority
Executive Board that for the IMF.
Somalia can be eligible for
debt relief under the
Enhanced HIPC Initiative
marks a historic moment.
It provides a clear
recognition of Somalia’s
sustained commitment to
key economic and
financial reforms under
consecutive staff-
monitored programs with
the IMF. This assessment
is an important step
towards forgiveness of
most of Somalia’s debt,
which measured US$5.3
billion in 2018.

IMF Executive March 25, Country is facing IMF Executive Board Risk pertaining to National Reforms will focus on a
Board and 2020 issues pertaining to Approves 3-Year ECF and Development plan, economy growth continued strengthening
Somalia National Development EFF Arrangements for etc. of public finances to
plan so that country Somalia meet Somalia’s
will move towards the IMF Board approves SDR development needs in a
greater economic 292.4 million (about sustainable manner; a
 resilience, promote US$395.5 million) ECF deepening of central
higher and more and EFF arrangements for bank capacity;
inclusive growth, and Somalia. improvement of the
reduce poverty. The three-year financing business environment
package will support the and governance; and
implementation of the enhancing statistics. The
authorities’ National program will support the
Development Plan and authorities’
anchor reforms between implementation of their
the HIPC Decision and ambitious reform agenda
Completion Points. and catalyze concessional
donor financing. This
will help the country
implement its National
Development Plan to
build greater economic
resilience, promote
higher and more
inclusive growth, and
reduce poverty.

IMF Executive July 21,2020 The COVID-19 The IMF Executive Board The COVID-19 had done the adverse The IMF’s debt service
Board and pandemic is having an approved debt relief under impact on BOP of a country and relief under the
Somalia adverse economic the Catastrophe public sector health needs including Catastrophe Containment
impact on Somalia, Containment and Relief other emergency spending. and Relief Trust will free
creating exceptional Trust to provide US$ 7.63 up public resources to
fiscal and balance of million (SDR 5.48 million) help address the
payments needs. The over the next 3 months, pandemic. The
economy has slowed and potentially up to US$ authorities are committed
sharply. 24.97 million (SDR 17.96 to using the additional
million) over the next 21 resources to address the
months. COVID pandemic in a
transparent manner and
have committed to
undertake and publish an
ex-post audit of COVID-
related spending. It will
be important to
reprioritize fiscal
spending for health and
other priority social
spending as needed.