The African Development Bank (AfDB) has granted Somalia $25 million to help the government in its fight against the global COVID-19 pandemic.
The grant package includes a $10.04 million grant from Pillar 1 of AfDB’s Transition Support Facility and another $15.06 million grant from the Regional Operations Envelope. Both of these fall under the Bank’s COVID-19 Response Facility (CRF).
The government of Somalia will use the funds to carry out three interlinked responses to the pandemic that will enhance the health system. These are:
- Safeguard livelihoods and social protection
- Support labour force productivity
- Economic activity
Some of the health-sector interventions include boosting infection prevention and control measures, increasing the country’s ICU capacity, and widening the provision of personal protective equipment (PPE).
Social protection measures include the provision of programs to offer temporary tax relief and customs duty relief, as well as a 50% relief on staple food, including cooking oil and flour.
Among initiatives aiming to support the workforce and economy are the establishment of a financing facility to support MSMEs (micro, small and medium enterprises), the introduction of permanent tax and customs increases on tobacco, beauty products, and plastic bags, and advancement of certification procedures for job-creating local production of COVID-19 supplies.
Under a worst-case scenario, Somalia’s real GDP is forecast to contract by 5.4% in 2020 and inflation to hit 6.3% as imports decrease.