By Asha Elmi - Reporter
Mogadishu, 20 August 2026 — Somalia’s economy grew 3.1% in 2025, the Ministry of Finance reported to cabinet on Thursday, as the government seeks to reduce reliance on foreign assistance and boost domestic revenues.
Prime Minister Hamza Abdi Barre chaired the weekly cabinet meeting where the report on 2025 annual accounts, tax collection and public financial management reforms was presented.
The growth figure aligns with independent estimates. The World Bank said Somalia’s economy grew about 3% in 2025, down from 4% in 2023 and 2024, citing declining foreign aid, drought and rising living costs.
Barre called for greater economic self-reliance, urging increased use of domestic production and natural resources, higher revenue collection, more investment and stronger transparency in public finances.
There has been progress on revenue. IMF data show domestic revenues reached $286 million by end-September 2025, above a programme target of $275 million. But domestic revenue remained at about 3.1% of GDP, according to the World Bank.
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The World Bank warned Somalia remains heavily dependent on external assistance. It said external grants fell in 2025, contributing to a fiscal deficit of 0.4% of GDP compared to a 0.1% surplus in 2024.
The prime minister also praised the Ministry of Finance after the Office of the Auditor General gave the government’s financial management a “Clean Opinion”, the highest rating.
The cabinet also received a security briefing. The government said Somali armed forces had made significant gains in recent operations against al-Shabaab militants and dealt the group a major blow.
Officials said the review comes as Somalia works to strengthen public financial management, expand the tax base and increase its ability to fund priorities from domestic resources.