Somalia

The Federal Republic of Somalia is in the Horn of Africa, bordered by Ethiopia to the west, Djibouti to the northwest, the Gulf of Aden to the north, the Indian Ocean to the east, and Kenya to the southwest. Somalia has a coastline of 3,333km which is the longest coastline in Africa, followed by South Africa. It has a population of 19.0 million and a GDP of US$12.05bn.

Somalia’s public debt-to-GDP ratio plummeted from 64% in 2018 to 6.4% in December 2023 as it reached the completion point in the Heavily Indebted Poor Countries (HIPC) debt reduction initiative, and its debt classification improved from in debt distress to moderate. Real GDP growth was projected at 3.7% in 2024 and 3.8% in 2025 due to gradually increasing spending on infrastructure and social sectors, supported by an envisaged uptick in development financing after reaching the debt reduction completion point.

Growth will be driven by agriculture and services on the supply side and private consumption and public investment on the demand side.

Somalia is classified by the United Nations as a least developed country, with the majority of its population being dependent on agriculture and livestock. About three-fifths of the economy is based on agriculture, with livestock raising being the main economic activity. Minerals produced in Somalia include gemstones and common building materials extracted for domestic consumption.

Sesame is the largest crop export, followed by dried lemon. The country\'s fish stocks hold potential for the economy, but despite a large economic exclusive zone, the fishing sector has remained small-scale and artisanal.

The Port of Berbera in Somaliland, a breakaway region of Somalia, has emerged as a port of growing importance. In May 2016, UAE-based DP World signed an agreement with the Somaliland government to develop and operate a regional trade and logistics hub at Berbera. Ethiopia subsequently entered into an agreement with DP World and the Somaliland Port Authority, where it will invest in infrastructure to develop the Berbera Corridor as a trade gateway.

Sources: Who Owns Whom sector reports, CIA Factbook, African Development Bank, World Bank, Trading Economics, African Statistical Yearbook and IMF. ?>