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Russia to forgive over $684 million of Somalia’s debt at Saint Petersburg summit

Thursday July 27, 2023

Mogadishu (HOL) - Somalia and Russia reached an agreement during the second Russia-Africa Summit in Saint Petersburg, wherein Russia forgave over $684 million in debt owed by Somalia.

The agreement was signed by Somalia's Minister of Finance, Bihi Iman Egeh, and Russia's Deputy Minister of Finance, Timur Igorevich Maksimov, on Wednesday.

The signing of these agreements, which include forgiving the debt and unblocking $7.5 million in funds, will aid Somalia in reaching the HIPC Completion Point, according to Minister Bihi.

The debt forgiveness includes Somalia's debts to Russia, which amounts to $7.5 million, and another debt that exceeds $684 million and is part of the Paris Club loans.

Earlier in May, the International Monetary Fund (IMF) provided a boost to Somalia's debt relief prospects by immediately disbursing $9.4 million. This disbursement came after the IMF Executive Board completed its fifth review under the Extended Credit Facility (ECF) for Somalia, bringing the debt-laden nation closer to achieving financial stability.