Somalia's economic growth to exceed 3% in 2026
Somalia's economic growth has slowed due to the drought, which has negatively affected agricultural production, especially livestock production. Real GDP grew by 3.0% in 2025, compared with 4.0% in 2024.
Inflation decreased to 3.8% in 2025 from a peak of 5.5% in 2024, driven by higher global commodity prices, while the financial sector remained stable with low levels of overdue loans (3.0% of total loans compared with 3.4% in 2024).
Real GDP is expected to increase gradually, to 3.1% in 2026 and 3.4% in 2027, due to the recovery of the agricultural sector and investments. Economic risks are associated with increased domestic instability and the consequences of the Middle East conflict.
AFRICAN DEVELOPMENT BANK
