The United Nations (UN) has welcomed Somalia’s efforts which led the country to reach ‘Decision Point’ for debt relief under Heavily Indebted Poor Countries (HIPC).
In a statement, UN has termed the move as historic milestone on the country’s path to peace and prosperity.
“United Natios congratulates Somalia for reaching the Highly Indebted Poor Countries Initiative’s (HIPC) ‘Decision Point’ for debt relief – an historic milestone on the country’s path to peace and prosperity,” reads the statement in part.
UN Secretary-General’s Special Representative for Somalia, James Swan said achievement of the HIPC ‘Decision Point’ is a major step forward for Somalia’s economic progress.
According the statement, the move allows the country to advance towards its long-term objective of inclusive economic growth and poverty reduction.
All Somalis can be proud of this achievement. The ‘Decision Point’ is tribute and testament to the federal authorities’ impressive public financial management reforms,” he said. “It also reflects strong collaboration between the Federal Government and the Federal Member States, and sets a template for future collaboration in this and other areas.”
Reaching ‘Decision Point’ means that Somalia’s eligibility for debt relief is confirmed, and its relations with International Financial Institutions are fully normalized.
Somalia will also qualify now for certain types of grant financing to meet its public finance and development needs, and for access to private sector financing instruments.
The International Monetary Fund (IMF) and World Bank established the HIPC Initiative in 1996 to ensure that no poor country faces a debt burden exceeding its capacity to service and manage.