Somaliland launches revised Public Financial Management Act No. 75/2025, strengthening budget transparency, parliamentary oversight, audits and state asset management
HARGEISA, Somaliland — Somaliland’s Ministry of Finance and Economic Development on Wednesday formally launched its revised Public Financial Management Act, Law No. 75/2025, presenting the legislation as a major step toward modernizing the government’s management of public money, strengthening institutional oversight and improving protection of state assets.
The launch ceremony in Hargeisa brought together senior government officials, financial oversight bodies and representatives of institutions responsible for budgeting, auditing, procurement and economic governance. Officials described the revised law as the legal foundation for a more unified public financial management system, replacing fragmented procedures with clearer rules governing how government revenue and assets are planned, collected, allocated, spent, monitored and reported.
The legislation comes as Somaliland seeks to strengthen the institutions underpinning public administration and economic development. At its core is a straightforward principle emphasized by the Finance Ministry: public money is held in trust for citizens and must therefore be subject to clear rules, institutional controls and public accountability.
“Public finances are assets held in trust for the people and are not the property of any individual or institution,” the ministry said in its statement accompanying the launch. “Their protection and proper management are therefore a legal, administrative and national responsibility shared by government institutions and officials.”
A broader overhaul of financial governance
The revised law goes beyond accounting procedures. It establishes a unified framework covering the full public-finance cycle, from budget preparation and approval to execution, auditing and financial reporting.
The Ministry of Finance said the legislation is designed to clarify the responsibilities of government institutions and officials at each stage of that process, reducing ambiguity over who is responsible for decisions involving public funds.
That division of responsibility is central to the law’s accountability provisions. Government institutions will be expected to identify the officials and authorities responsible for financial planning, allocation, expenditure, oversight and reporting.
The law also seeks to make budget information more transparent by establishing requirements covering the preparation, approval, implementation and reporting of the national budget.
For Somaliland’s House of Representatives, the legislation strengthens the institutional basis for parliamentary scrutiny of public finances. Comprehensive financial information and reporting are intended to give lawmakers a stronger foundation for examining government revenue and expenditure and exercising their constitutional oversight responsibilities.
The framework also creates opportunities for citizens to contribute views and recommendations during different stages of the budget process and financial reporting.
Internal controls and the fight against corruption
One of the most consequential elements of the reform is the strengthened role of internal auditing within government institutions.
Under the revised framework, public institutions are expected to establish internal audit arrangements capable of testing internal controls, identifying weaknesses and helping prevent corruption, misuse and mismanagement of government resources.
The law also makes a clearer distinction between internal and external auditing.
Internal audit is principally concerned with the effectiveness of an institution’s internal controls, systems and procedures. The Auditor General, by contrast, retains an independent external oversight role in auditing and reporting on the management and use of public finances.
The separation is designed to prevent overlapping responsibilities while creating multiple layers of financial scrutiny.
The Ministry of Finance said stronger controls, oversight and reporting should help reduce the risks of corruption, misappropriation, financial errors and negligence in the management of public assets.
But the effectiveness of such provisions will ultimately depend on implementation. Laws governing public finance can establish responsibilities and procedures; enforcement, institutional independence, qualified personnel and consistent reporting determine whether those provisions work in practice.
A Treasury Single Account and modern financial systems
The revised legislation also lays the legal groundwork for a Treasury Single Account, or TSA, a system intended to consolidate government cash resources and improve the state’s ability to monitor and manage its available funds.
The reform is part of a broader push to modernize Somaliland’s public financial management and accounting systems through greater use of technology.
A centralized treasury structure can give governments a more comprehensive picture of available cash, reduce fragmented government accounts and improve cash-flow management. The new law therefore links legal reform with administrative modernization.
The legislation similarly strengthens the Ministry of Finance’s authority over public assets, including procedures for their registration, monitoring, management and control.
That provision extends the reform beyond cash and revenue. Government property and other public resources are also brought within a more clearly defined framework of institutional responsibility.
Debt, grants and government guarantees
The revised law establishes provisions governing public borrowing, grants and government guarantees, while assigning responsibilities to the institutions involved.
This is particularly important as governments seek to balance development financing with fiscal sustainability. Clear rules for debt and guarantees can help identify who has authority to incur financial obligations on behalf of the state and how those obligations should be reported.
The legislation also establishes defined obligations for government institutions to prepare, submit and present financial statements and other reports.
The objective, according to the Finance Ministry, is a system in which the movement of public money can be traced from its source through allocation and expenditure to the results achieved.
That emphasis on traceability represents a shift from simply recording transactions toward measuring whether public resources are being managed effectively.
Parliament, citizens and public accountability
The reform also places greater emphasis on the relationship between public finances and representative institutions.
By providing the House of Representatives with more comprehensive financial information, the law is intended to strengthen legislative examination of government spending.
At the same time, provisions for public participation recognize that budget decisions affect citizens directly, whether through taxation, public services or government investment.
The combination of parliamentary oversight and public participation is intended to broaden accountability beyond the executive branch.
“The Public Financial Management Act is not merely a legal instrument for managing government funds,” the ministry said. “It is a fundamental pillar for accountability, efficiency, transparency, good governance and the protection of national assets.”
Senior officials attend Hargeisa launch
The ceremony was attended by senior officials from across Somaliland’s financial, judicial and oversight institutions.
Speeches and remarks were delivered by the minister of Finance and Economic Development, the chief justice of the Supreme Court, the Auditor General, the director general of the Ministry of Finance and Economic Development, the chairperson of the Good Governance Commission, the chairperson of the National Tender Board and the chairperson of the Economic Sub-Committee of the House of Representatives.
The state minister for Finance and Economic Development also attended.
Technical presentations were delivered by the chief executive of the Institute of Certified Public Accountants of Somaliland and the director of the Public Financial Management Reform Department. The presentations focused on the architecture of the revised law, the reforms it introduces and its implications for the country’s financial management system.
The breadth of institutions represented at the ceremony underscored the legislation’s intended reach. Public financial management is not confined to the Finance Ministry; it affects virtually every government institution that collects revenue, spends public money, manages state property or reports financial information.
From legal reform to implementation
The launch marks an important institutional milestone, but the more difficult phase begins with implementation.
The revised Public Financial Management Act provides Somaliland with a framework for moving toward standardized financial procedures, stronger controls and more transparent reporting. Its success will depend on whether government agencies adopt the required systems, whether financial information is produced consistently and whether oversight institutions can exercise their mandates effectively.
The law’s provisions on internal audit, parliamentary scrutiny, public participation, treasury management, asset registration and financial reporting collectively point toward a broader transformation of how the government manages public resources.
For Somaliland, the stakes extend beyond bookkeeping.
Effective public financial management is closely linked to the credibility of government institutions, the quality of public services and the confidence of citizens and potential investors in the state’s economic administration.
The Ministry of Finance characterized the reform as an opportunity to move away from “fragmented and disparate financial management procedures” toward a system that is “modern, structured, transparent, efficient and accountable.”
Whether that transformation is achieved will ultimately be measured not by the launch ceremony, but by the quality of budgets, audits, financial reports and public services that follow.
For now, Law No. 75/2025 gives Somaliland a substantially more defined legal framework for pursuing that objective.
