Somalia enters 2025 at a critical juncture, marked by promising economic growth, historic political reforms, persistent security challenges, and ongoing humanitarian needs. This comprehensive overview examines the key developments and prospects for Somalia across multiple sectors as the country strives for stability and progress.

Economic Outlook: Cautious Optimism Amid Challenges

Somalia’s economy shows signs of resilience and growth as it moves into 2025, building on the momentum gained in previous years. The country’s Gross Domestic Product (GDP) is projected to expand from $12.5 billion in 2024 to $13.5 billion in 2025, reflecting a growth rate of 3.9%[4]. This growth trajectory, while modest, represents a significant improvement from the 2.8% growth recorded in 2023[4].

Several factors contribute to this positive economic outlook. The agricultural sector, a cornerstone of Somalia’s economy, has rebounded strongly thanks to favorable weather conditions. This recovery has led to increased crop production and a resurgence in livestock exports, both crucial components of the country’s economic fabric[2]. The livestock sector, in particular, has shown remarkable resilience, with exports increasing significantly and contributing substantially to the overall economic growth[2].

Another key driver of economic expansion is the anticipated increase in foreign direct investment (FDI) during the post-Heavily Indebted Poor Countries (HIPC) Initiative period. Somalia’s achievement of the HIPC Completion Point in December 2023 marked a significant milestone, resulting in debt service savings of $4.5 billion and improved access to critical financial resources[12]. This development has substantially reduced Somalia’s external debt from 64% of GDP in 2018 to less than 6% by the end of 2023, greatly enhancing the country’s debt sustainability and attractiveness to foreign investors[12].

Remittances from the Somali diaspora are expected to play an increasingly important role in the economy. As global inflationary pressures ease, it is projected that the diaspora community will have more disposable income to send back home, further fueling economic growth[4]. These remittances not only contribute to household incomes but also serve as a vital source of foreign exchange for the country.

The Federal Government of Somalia (FGS) has outlined several priorities to achieve and sustain the forecasted growth rate of 3.9% in 2025. These include strengthening security as the foundation for sustainable economic growth, implementing measures to improve efficiency and productivity in the civil service and public expenditure, and increasing spending on public investments in productive sectors[4]. The government also plans to boost small and medium-sized enterprises (SMEs) and household incomes through initiatives such as the Somalia Development and Reconstruction Bank[4].

However, Somalia’s economic outlook is not without challenges. The country remains vulnerable to climate shocks, with the potential for droughts or floods to disrupt agricultural production and economic activities. Security threats, particularly from the al-Shabaab militant group, continue to pose risks to stability and investment. Global economic shocks and commodity price fluctuations could also impact Somalia’s growth trajectory[16].

Inflation, while showing signs of moderation, remains a concern. After reaching 6.8% in 2022, inflation is projected to ease to 4.1% in 2024 and further to 4.0% in 2025[16]. This gradual decline is attributed to stabilizing supply chains, improved weather conditions, and the easing of global commodity prices[2].

The fiscal situation presents both opportunities and challenges. While Somalia achieved a balanced budget in 2022, consistent with its HIPC commitments, projections indicate a potential fiscal deficit of 1.9% of GDP in 2024[16]. This underscores the need for stronger public revenue mobilization efforts to support increased government spending on critical sectors such as infrastructure, education, and healthcare.

Somalia’s current account deficit, while expected to narrow, remains substantial. Projections indicate a deficit of 14.1% of GDP in 2024, down from 17.1% in 2022[16]. This high deficit reflects the country’s significant import bill, particularly for energy and food products. Efforts to diversify the economy and boost exports will be crucial in addressing this imbalance over the medium term.

As Somalia moves forward, the implementation of structural reforms and the gradual scaling up of public investments in key sectors will be vital for maintaining and accelerating economic growth. The government’s commitment to improving the business environment, strengthening financial institutions, and fostering regional economic integration through its recent accession to the East African Community presents opportunities for sustained economic development.

Political Landscape: Historic Reforms and Ongoing Challenges

The year 2025 marks a pivotal moment in Somalia’s political evolution, characterized by significant constitutional reforms and the ambitious goal of implementing universal suffrage. These developments represent a potential turning point in the country’s democratic journey, though they also bring new challenges and tensions to the forefront.

In a historic move, Somalia’s bicameral Federal Parliament approved amendments to the first four chapters of its provisional constitution in March 2024[25]. These amendments introduce several fundamental changes to the country’s political system:

1. One-person, one-vote system: The new amendments replace the traditional clan-based formula for organizing elections with a direct voting system. This change aims to broaden political participation and representation across Somali society[25].
2. Direct presidential elections: The amendments provide for the direct election of the president by the populace, a significant departure from the previous indirect system[25].
3. Presidential powers: The changes authorize the President to appoint and dismiss the Prime Minister without parliamentary approval, potentially centralizing executive power[25].
4. Multi-party system: The amendments establish a multi-party system with three national political parties, laying the groundwork for a more diverse and competitive political landscape[25].
5. Term limits: The changes set five-year terms for constitutional bodies, providing more stability and predictability in governance structures[25].

These reforms represent a significant step towards democratization and aim to address long-standing issues in Somalia’s political system. However, their implementation faces several challenges and has sparked controversy among various political actors.

The National Consultative Council (NCC), which brings together leaders of the federal government and federal member states, has been working to advance these reforms. In May 2024, the NCC urged the federal government and legislative bodies to fast-track laws and institutions necessary for implementing the one-person, one-vote election system[25]. This push demonstrates the government’s commitment to realizing these ambitious changes.

However, the constitutional amendments and proposed electoral reforms have not been universally welcomed. Several prominent Somali leaders, including former Presidents Mohamed Abdullahi Farmaajo and Sharif Sheikh Ahmed, have expressed reservations about the changes, citing a lack of consensus among political leaders[25]. This opposition highlights the deep-rooted divisions and competing interests within Somalia’s political landscape.

The situation is further complicated by regional tensions. In a significant move, Puntland, one of Somalia’s federal member states, announced in March 2024 its decision to withdraw recognition of and trust in the federal government[25]. Puntland declared it would act independently until a federal system of governance is established based on consensus and an agreed Somali constitution. This decision underscores the fragile nature of Somalia’s federal structure and the ongoing challenges in balancing central and regional powers.

The implementation of universal suffrage, while a laudable goal, faces significant logistical and security challenges. The persistent threat from al-Shabaab, particularly in areas under the group’s control, could potentially delay or disrupt the voting process[3]. Additionally, the lack of robust infrastructure and the need for extensive preparation for a nationwide direct vote pose substantial obstacles[3].

Despite these challenges, the Somali parliament passed election legislation for universal suffrage in November 2024, with 169 lawmakers voting in favor[3]. This legislative action represents a crucial step towards realizing the vision of direct elections, though much work remains to be done to translate this vision into reality.

The political reforms and tensions are unfolding against the backdrop of ongoing security challenges. The planned withdrawal of the African Union Transition Mission in Somalia (ATMIS) by the end of 2024 raises concerns about potential security gaps[25]. The Somali government’s ability to assume full security responsibilities following ATMIS’s departure will be a critical factor in the success of political reforms and the overall stability of the country.

As Somalia navigates this complex political transition, the outcome will have significant implications for the country’s stability, democratic development, and international relations in the coming years. The successful implementation of universal suffrage could mark a turning point in Somalia’s democratic journey, but it will require careful management, consensus-building, and continued support from the international community.

Security Situation: Persistent Threats and Evolving Strategies

As Somalia enters 2025, the security landscape remains a critical concern, with the ongoing threat from al-Shabaab continuing to shape the country’s stability and development prospects. Despite sustained efforts by the Somali government and international partners, al-Shabaab has demonstrated resilience and adaptability, posing significant challenges to peace and security.

The Somali government, under President Hassan Sheikh Mohamud, has maintained its commitment to combating al-Shabaab through a multi-faceted approach. This strategy combines military operations with economic and ideological measures, aiming to weaken the group’s influence and operational capabilities[11]. The government has managed to muster considerable national and international support for these efforts, including from neighboring states, which recognize the regional implications of the al-Shabaab threat.

However, the effectiveness of these efforts has been mixed. While there have been some successes in pushing al-Shabaab out of certain territories, the group continues to demonstrate its ability to carry out attacks and control significant areas, particularly in southern Somalia. In 2024, ACLED recorded 127 events of violence targeting civilians perpetrated by al-Shabaab, resulting in 187 reported fatalities[23]. This data underscores the persistent threat the group poses to civilian populations and the challenges faced by security forces in protecting vulnerable communities.

The security situation is further complicated by the planned withdrawal of the African Union Transition Mission in Somalia (ATMIS). As of June 2024, ATMIS had already withdrawn 2,000 of its estimated 20,000 forces from Somalia, with further withdrawals planned as part of its expected complete withdrawal by late 2024[22]. This drawdown raises significant concerns about potential security gaps and the readiness of Somali security forces to assume full responsibility for the country’s security.

Recognizing these challenges, the Somali government requested a delay in September 2024 for the withdrawal of an additional 3,000 ATMIS troops[22]. This request reflects the ongoing need for international support in maintaining security and combating al-Shabaab. The transition of security responsibilities from ATMIS to Somali national forces remains a critical and delicate process, with implications for the country’s overall stability and the success of its political and economic initiatives.

Inter-clan violence has emerged as another significant security concern, particularly in northern, central, and southern Somalia. These conflicts, often driven by disputes over grazing land and other resources, have resulted in significant displacement and disruption of livelihoods. Between January and September 2024, armed inter-clan violence displaced nearly 150,000 people across different parts of Somalia, with Galmudug and Jubaland States being particularly affected[17].

The security challenges have had a profound impact on civilian life and humanitarian efforts. The closure of several health facilities due to funding shortfalls has exacerbated the situation in conflict-affected areas[17]. Additionally, the presence of unexploded ordnance and other remnants of war pose ongoing threats to civilian populations, highlighting the need for comprehensive mine action services.

In response to these multifaceted security challenges, the Somali government and its international partners have been working on several fronts:

1. Strengthening national security forces: Efforts are ongoing to build the capacity of the Somali National Army and police forces, with a focus on improving their ability to maintain security independently of international support.
2. Counter-terrorism operations: The government continues to conduct operations against al-Shabaab, targeting the group’s leadership and disrupting its financial networks.
3. Community engagement: There is an increasing focus on engaging local communities in security efforts, recognizing the importance of local support in countering extremist influences.
4. Regional cooperation: Somalia is working to strengthen security cooperation with neighboring countries, acknowledging the transnational nature of the al-Shabaab threat.
5. Addressing root causes: There is growing recognition of the need to address the underlying factors that contribute to insecurity, including poverty, lack of economic opportunities, and political marginalization.

As Somalia looks towards 2025 and beyond, the security situation remains a critical factor in the country’s overall stability and development prospects. The success of political reforms, economic growth initiatives, and humanitarian efforts all hinge on the ability to create a more secure environment. While challenges remain significant, the continued commitment of the Somali government and its international partners to addressing these security issues provides a foundation for cautious optimism.

Humanitarian Situation: Ongoing Needs and Resilience Building

As Somalia enters 2025, the humanitarian situation remains a significant concern, with millions of people still requiring assistance due to a complex interplay of factors including climate shocks, conflict, and economic challenges. While there have been some improvements, the scale of needs remains substantial, necessitating continued support from both national and international actors.

According to projections for 2025, approximately 5.98 million people in Somalia will require humanitarian and protection assistance, representing a 13% decrease from the 6.9 million in need in 2024[13]. This reduction reflects a more focused approach to identifying those affected by acute shocks driving humanitarian needs. Of this population in need, humanitarian partners plan to target 4.6 million people for assistance, an 11% decrease from the 5.2 million targeted in 2024[13].

Food insecurity remains a critical concern. As of September 2024, at least 3.6 million people were experiencing crisis levels of hunger in Somalia, with projections indicating this number could rise to 4.4 million between October and December 2024[10]. This increase is largely attributed to anticipated below-average rains, which are expected to exacerbate food insecurity and drinking water scarcity.

The nutritional status of children is particularly concerning. Projections indicate that 1.6 million children under the age of five will be at risk of acute malnutrition until July 2025, including 403,000 who are likely to suffer from severe malnutrition[21]. This represents a 14% increase in Global Acute Malnutrition and a 21% increase in Severe Acute Malnutrition compared to the previous year, highlighting the urgent need for targeted nutritional interventions.

Water scarcity continues to be a significant challenge, with approximately 6.6 million people facing water shortages[21]. This situation has led to a spike in waterborne diseases, including cholera outbreaks in various parts of the country. The lack of access to clean water not only poses immediate health risks but also impacts agricultural productivity and overall livelihoods.

Displacement remains a critical issue, driven by both conflict and climate shocks. As of September 2024, there were approximately 3.3 million internally displaced persons (IDPs) in Somalia[14]. The ongoing security operations against al-Shabaab, inter-clan conflicts, and climate-related events such as droughts and floods continue to drive people from their homes, putting additional pressure on already strained resources in host communities.

Climate change continues to play a significant role in shaping Somalia’s humanitarian needs. The country remains highly vulnerable to extreme weather events, with both droughts and floods causing significant disruptions. The Somalia Inter-Cluster Coordination Group has developed a preparedness and anticipatory plan to mitigate the impact of projected below-average rainfall and La Niña conditions, aiming to prevent displacement and associated protection risks[13].

In response to these complex humanitarian challenges, various initiatives and programs are underway:

1. UNICEF’s Humanitarian Action for Children: UNICEF is appealing for $171 million in 2025 to support 1.8 million people, including 1.1 million children, with integrated health, nutrition, WASH, education, and protection services[21].
2. Early Action Funding: The UN Central Emergency Response Fund (CERF) has allocated $5 million for early action against drought, targeting 130,000 people[13].
3. Health Infrastructure Improvements: The reopening of Garowe hospital in Puntland State after extensive reconstruction is expected to provide quality lifesaving services to an estimated 1 million people, primarily women and children[10].
4. Localization Efforts: There is an increasing focus on fostering localization in humanitarian responses, enhancing program integration, and ensuring accountability to affected populations.

Despite these efforts, significant challenges remain in addressing Somalia’s humanitarian needs. Funding shortfalls continue to be a major constraint, with only 40% of the required $1.59 billion for the 2024 humanitarian response plan received as of late 2024[13]. This funding gap limits the ability of humanitarian partners to reach all those in need and underscores the importance of continued international support.

As Somalia moves forward, there is a growing recognition of the need to bridge humanitarian assistance with longer-term development initiatives. This approach aims to build resilience among vulnerable populations, reduce dependency on humanitarian aid, and support sustainable solutions to recurring challenges. Efforts are being made to invest in disaster risk management, social protection systems, and more resilient rural livelihood systems.

The humanitarian situation in Somalia in 2025 remains complex and challenging, requiring sustained attention and support from both national and international actors. While there have been some improvements, the scale of needs remains significant, particularly in the face of ongoing climate shocks an

Citations:
[1] https://www.securitycouncilreport.org/monthly-forecast/2024-12/somalia-38.php
[2] https://www.worldbank.org/en/news/press-release/2024/06/20/somalia-afe-expects-3-1-percent-gdp-growth-rebounding-from-drought-and-commodity-price-shocks
[3] https://www.unicef.org/media/154536/file/2024-HAC-Somalia-revised-January.pdf
[4] https://mof.gov.so/sites/default/files/Publications/Draft_Budget_Strategy_for_FY2025_V2%20publish.pdf
[5] https://acleddata.com/2024/10/28/controversy-over-electoral-reform-sparks-debate-in-somalia-amid-al-shabaab-operation-october-2024/
[6] https://reliefweb.int/report/somalia/somalia-economic-update-june-2024-edition-no-9-addressing-climate-change-challenges-economic-growth
[7] https://somalia.unfpa.org/en/publications/somalia-humanitarian-situation-report-january-march-2024
[8] https://www.unocha.org/publications/report/somalia/somalia-2025-humanitarian-needs-and-response-plan-hnrp-summary
[9] https://www.imf.org/en/News/Articles/2024/12/10/pr-24462-somalia-imf-concludes-2024-aiv-consultation-and-2nd-rev-under-ecf
[10] https://reliefweb.int/report/somalia/somalia-monthly-humanitarian-update-september-2024
[11] https://bti-project.org/en/reports/country-report/SOM
[12] https://www.worldbank.org/en/country/somalia/overview
[13] https://reliefweb.int/report/somalia/somalia-monthly-humanitarian-update-october-2024
[14] https://reliefweb.int/report/somalia/somalia-complex-emergency-fact-sheet-1-fiscal-year-fy-2025-december-20-2024
[15] https://reliefweb.int/report/somalia/somalia-situation-update-september-2024-state-officials-somalia-crack-down-clan-militia-checkpoints
[16] https://www.afdb.org/en/countries-east-africa-somalia/somalia-economic-outlook
[17] https://www.unocha.org/publications/report/somalia/somalia-situation-report-13-aug-2024
[18] https://mop.gov.so/somalia-kicks-off-national-transformation-plan-for-2025-2029-2/
[19] https://acleddata.com/2024/12/13/mapping-al-shabaabs-activity-in-somalia-in-2024/
[20] https://vcda.afdb.org/en/system/files/report/Somalia%20Final%202024.pdf
[21] https://www.unicef.org/media/166131/file/2025-HAC-Somalia.pdf
[22] https://www.hrw.org/world-report/2024/country-chapters/somalia
[23] https://reliefweb.int/report/somalia/somalia-kenya-situation-update-august-2024-whats-next-fight-against-al-shabaab
[24] https://mof.gov.so/sites/default/files/Publications/FGS%20Budget%20Framework%20Paper%20for%20FY%202025%20revisedv15.pdf
[25] https://www.securitycouncilreport.org/monthly-forecast/2024-06/somalia-35.php