As we step into 2025, it’s a perfect time to reflect on the future of the Horn of Africa (HoA) and the opportunities ahead. In October 2024, we were part of the 22nd Ministerial Meeting of the Horn of Africa Initiative hosted by the World Bank Group (WBG), bringing together finance ministers from Djibouti, Ethiopia, Kenya, Somalia, South Sudan, and Sudan.

Alongside ministers, development partners, and key regional players, we discussed the region’s economic challenges and explored the potential for innovative financial solutions towards a brighter, more sustainable future.

While the financial hurdles are clear—macroeconomic imbalances, high debt levels, and limited fiscal space—what became clear during this meeting was the collective commitment to turning these challenges into opportunities for growth and resilience.

At the heart of challenges facing HoA countries is the financial fragility due to persistent macroeconomic imbalances. Discussions during the meeting highlighted that limited domestic savings, fiscal deficits, and rising debt have made it difficult for HoA economies to finance the growing investment needs, especially in social services and infrastructure.

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