Introduction
1. The London Conference on Somalia took place at Lancaster House on 23rd February 2012, attended by fifty-five delegations from Somalia and the international community.
2. We met at a key moment in Somalia’s history. Somalia is emerging from the worst humanitarian crisis in the world. African and Somali troops have pushed Al Shabaab out of Mogadishu and other areas. The transitional institutions come to an end in August 2012, and the people of Somalia want clarity on what will follow. The situation remains precarious, and in urgent need of support from the international community.
3. Decisions on Somalia’s future rest with the Somali people. The Somali political leadership must be accountable to the people. The international community’s role is to facilitate Somalia’s progress and development: our strength is in unity and coordinated support to Somalia. We noted the importance of listening to and working with Somalis inside and outside Somalia, and welcomed their engagement in the run-up to this Conference.
4. The Conference focussed on the underlying causes of instability, as well as the symptoms (famine, refugees, piracy, and terrorism). We, the international community, agreed: to inject new momentum into the political process; to strengthen AMISOM and help Somalia develop its own security forces; to help build stability at local level; and to step up action to tackle pirates and terrorists.
Political
5. We agreed that the Transitional Federal Institutions’ mandate ends in August 2012. There must be no further extensions. We welcomed the agreements that chart the way towards more representative government: the Transitional Federal Charter, the Djibouti Agreement, the Kampala Accord, and the Roadmap. We welcomed the progress represented by the Garowe Principles, endorsed the priority of convening a Constituent Assembly, and emphasised that the Assembly must be representative of the views of the Somali people of all regions and constituencies, and that women must be part of the political process. In line with Garowe II, we agreed to incentivise progress and act against spoilers to the peace process, and that we would consider proposals in this regard before the Istanbul Conference in June.
6. The Conference recognised the need for the international community to support any dialogue that Somaliland and the TFG or its replacement may agree to establish in order to clarify their future relations.
7. We condemned terrorism and violent extremism, whether perpetrated by Somalis or foreigners. We called on all those willing to reject violence to join the Djibouti peace process. We agreed to develop a defectors’ programme to support those who leave armed groups.
8. We emphasised the urgency of Somalia funding its own public services, and using its assets for the benefit of the people, as well as tackling corruption. We welcomed the progress that has been made in establishing a Joint Financial Management Board to increase transparency and accountability in the collection and efficient use of public revenues, as well as international development aid, and which will help strengthen Somali public financial management institutions. A declaration by the initial members of the JFMB is at Annex A.
9. Respect for human rights must be at the heart of the peace process. We called for action to address in particular the grave human rights violations and abuses that women and children face. We emphasised that journalists must be able to operate freely and without fear. Civilians must be protected. We called on the Somali authorities to take measures to uphold human rights and end the culture of impunity. We agreed to step up international efforts including through the UN human rights architecture.
Security and Justice
10. We agreed that security and justice were essential both to a successful political process and to development. Better security could only be achieved sustainably in parallel with better justice and the rule of law.
11. We expressed gratitude to those countries whose troops had served as peacekeepers and paid tribute to the achievements and sacrifices of AMISOM and other forces. We welcomed joint planning by the UN and African Union and reiterated the importance of effective command and control. We welcomed the adoption of UN Security Council Resolution 2036, which expands AMISOM’s mandate and raises the troop ceiling. We encouraged AMISOM to ensure the protection of civilians. We encouraged partners, especially new donors, to contribute to funding for AMISOM, including through the EU.
12. We agreed that, over time, Somalis should take over responsibility for providing their own security and develop their own justice systems to deal with the threats to their security and improve access to justice. We noted that Somalis themselves must decide what security and justice arrangements they need.
13. We acknowledged the good work underway in supporting the Somali security and justice sectors. We agreed that we would build an international framework of partners in order to bring much needed coordination and focus to those efforts, underpinned by a set of principles at annex B, and working closely with the UN’s Joint Security Committee.
Piracy
14. We reiterated our determination to eradicate piracy, noting that the problem requires a comprehensive approach on land as well as at sea. We expressed our concern that hostages in Somalia are being held longer and with more use of violence. We welcomed the work of the Contact Group on Piracy off the Coast of Somalia. We also welcomed the success of international military efforts, and remain committed to such efforts with robust rules of engagement and sufficient force generation. We agreed that piracy cannot be solved by military means alone, and reiterated the importance of supporting communities to tackle the underlying causes of piracy, and improving the effective use of Somali coastal waters through regional maritime capacity-building measures. We welcomed those initiatives underway and agreed to coordinate and support such initiatives better. We called for full implementation of the Djibouti Code of Conduct and the adoption of an Exclusive Economic Zone. We look forward to reviewing progress including at the Piracy Conference in the UAE in June.
15. We welcomed the efforts of partners in industry against piracy, and called for greater take-up of Best Management Practice on ships. We welcomed current work on international guidance on the use of private armed security companies.
16. There will be no impunity for piracy. We called for greater development of judicial capacity to prosecute and detain those behind piracy both in Somalia and in the wider region and recognised the need to strengthen capacity in regional states. We welcomed new arrangements, which enable some states and naval operations to transfer suspected pirates captured at sea for trial by partners across the Indian Ocean region, and if convicted, to transfer them to prisons in Puntland and Somaliland which meet international standards. We noted the intention to consider further the possibility of creating courts in Somalia specialised in dealing with piracy.
17. We reiterated our determination to prosecute the kingpins of piracy. Recognising work already undertaken, we agreed to enhance coordination on illegal financial flows and to coordinate intelligence gathering and investigations. We noted the establishment of a Regional Anti-Piracy Prosecutions Intelligence Coordination Centre in the Seychelles.
Terrorism
18. Terrorism poses a serious threat to security in Somalia itself, to the region, and internationally. It has inflicted great suffering on the Somali population. We agreed to work together with greater determination, and with full respect for the rule of law, human rights, and international humanitarian law, to build capacity to disrupt terrorism in the region, and to address the root causes of terrorism. We agreed on the importance of disrupting terrorists’ travel to and from Somalia, and on the importance of disrupting terrorist finances, and called on countries in the region to implement the Financial Action Task Force’s recommendations on combating money laundering and the financing of terrorism. We noted that effective intelligence gathering and investigation, and support to the Somali criminal justice system, were critical to the fight against terrorism. We agreed to work with the Global Counter Terrorism Forum and other international and regional bodies to deliver this important work.
Stability and Recovery
19. We welcomed the success in some areas of Somalia in establishing local areas of stability, and agreed to increase support to build legitimate and peaceful authorities, and improve services to people living in these areas. We acknowledged the importance of creating the conditions inside Somalia for durable solutions for the displaced that respect international laws. We agreed that such efforts should promote local and regional cohesion, and converge with the national political process.
20. We considered the implementation of the Mogadishu Recovery and Stabilisation Plan important. We agreed to expand programmes to newly-recovered areas. We would focus support on enabling the delivery of immediate and sustainable benefits to ordinary Somali people: safety and security, economic opportunities and basic services. We would promote effective and accountable local administrations, and support the resolution of disputes.
21. We agreed that all support to local areas of stability should be in accordance with the New Deal for engagement in fragile states recently adopted in Busan, and build on the stabilisation strategies prepared by both IGAD and the Transitional Federal Government. We endorsed a set of principles to guide international support to local areas of stability in Somalia (Annex C). We agreed to continue funding local stability through existing programmes, and noted the establishment of a new Stability Fund to which a number of us will contribute[1].
22. We agreed that Somalia’s long-term reconstruction and economic development depended on a vibrant private sector, and that both aid and diaspora finance could develop Somalia’s considerable potential in livestock, fisheries and other sectors. We noted that stability was a prerequisite for most sustainable investments in infrastructure such as electricity, roads and water systems. We looked forward to further discussion on all these issues at the Istanbul Conference.
Humanitarian
23. The Conference was preceded by a separate meeting on humanitarian issues co-chaired by the United Nations and the United Arab Emirates. Notwithstanding the end of the famine, participants expressed concern at the ongoing humanitarian crisis, and committed to providing humanitarian aid based solely on need. They agreed a set of conclusions on humanitarian issues and linking relief with longer-term recovery (set out in a separate document).
International coordination
24. We agreed to carry forward work agreed at London through the International Contact Group on Somalia (ICG), and welcomed the ICG’s decision in Djibouti to look at restructuring to become more effective. We recommended that the ICG establish working groups on the political process, security and justice, and stability and development. We noted that, within the ICG, a core group of engaged countries would drive progress in support of UN, AU and IGAD efforts.
25. We welcomed the efforts of the Special Representative of the Secretary-General and the United Nations Political Office for Somalia (UNPOS) in facilitating progress in Somalia. We also welcomed the role of IGAD and the African Union, and the support of the League of Arab States, the European Union, and the Organisation of Islamic Cooperation. We encouraged effective coordination between UN entities working on Somalia. While recognising the still challenging security situation in Somalia, we welcomed UNPOS’ relocation to Mogadishu and agreed that we would aim to spend more time on the ground in Somalia in order to work more closely with Somalis on the challenging tasks ahead.
Conclusion
26. We expressed the hope that a new era of Somali politics, supported by the international community, will bring peace to Somalia. We are determined to place the interests of the Somali people at the heart of all our actions. We looked forward to the day when the situation in Somalia would have made sufficient progress for an international conference to be held there. In the meantime, we will redouble our efforts to support the people of Somalia in their search for a better future for their country.
London - 23 February 2012
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Annex A
Thursday, February 23, 2012
Establishing the Joint Financial Management Board (hereafter “the Board” or “the JFMB”) is a positive response to the spirit and letter of commitments already entered into by the Transitional Federal Government (TFG) and members of the international community.
On 9 September 2011 in Nairobi, the Heads of State and Government of the East African Community (EAC), the Inter-Governmental Authority on Development (IGAD) and the Republic of South Sudan solemnly declared in paragraph xi (12) of the Joint Declaration of ‘The summit on the Horn of Africa crisis: Ending drought emergencies: A Commitment to Sustainable Solutions’ to undertake: “the formation of a Joint TFG-Donor Financial Management Board, to manage all financial resources provided to the TFG from both internal and external sources.”
On 30 September 2011 in Copenhagen, the International Contact Group (ICG) recommended in the Final Communiqué: “The establishment of a Joint TFG-Donor Financial Management Board as recommended by the Horn of Africa Summit in September 2011.”
Currently, the initial members of the JFMB are the Transitional Federal Government (TFG) of Somalia, or any future successor government of Somalia; the United Kingdom; the French Republic; the European Union; and the World Bank. It is the expectation of the members that the Board will be expanded to include other donors before it is formally established.
Initial members agree the following:
Aims:
• The Board aims to eliminate the diversion of revenues generated from national assets and received in external assistance.
• The Board aims to maximise the productive use in the public interest of revenues generated both by Somalia’s national assets and received in external development assistance.
• The Board also aims to provide accountability and transparency on where and how Somali revenues and donor funds are spent.
Objectives:
• To establish a joint Board with key donor and Somali membership for the purpose of increasing mutual accountability and transparency; and an operational level with the task of forging joint structures with international and Somali counterparts at critical points in the TFG financial environment.
Principles of engagement:
• The Board will seek accountability from Somali public finance institutions for public revenues and expenditures. Simultaneously the Board will seek greater transparency and accountability from international donors and implementing agencies for aid commitments and more effective and efficient implementation of aid.
• The Board should have access to full information concerning financial flows both from internal revenue streams and for external assistance.
• The Board is intended to be a temporary body, the need for which will diminish as Somali public finance institutions become strong enough to manage public finances and prevent diversion.
• The mandate of the Board will be further defined in discussion between the TFG and development partners. A progress review will take place at the end of the mandate.
• The Board is intended to strengthen the ability of Somali public finance institutions to manage Somali public finances and to monitor donor funds.
• The operations of the Board should be, to the extent practical, within Somalia.
• The Board should enhance the sovereignty of the Somali state by building trust between the Somali authorities and international community.
Scope of the Board:
• Internal revenue includes domestic financial flows that are or should be characterized as public resources, including what are or should be national or public assets.
• External assistance includes all donor funds sent to or intended for Somalia whether multilateral or bilateral and whether given to an institution or individual holder of public office.
Establishment:
The President, Prime Minister and Minister of Finance of the TFG will initially represent the TFG on the JFMB. The head of state, head of government and minister of finance or equivalent of any future successor government of Somalia will represent that government on the JFMB. Additional TFG or Somali government representatives may be added under processes established by the JFMB.
The admission of new members will be guided by the standards of accountability and transparency of the prospective member, and the JFMB will establish relevant criteria for the purpose.
Operational Level:
The Board will be supported by an operational level structure. International and Somali counterparts will be identified and appointed for support at critical financial points.
Funding Mechanism:
• Initially, costs of the JFMB will be borne by individual members of the JFMB.
• It is the intention of the parties that as the Somali government maximizes revenues, the running costs of the Board will at some point be shared between international members of the Board and the Somali government.
Next Steps:
Agreement will be reached on the following areas in discussions between development partners and the TFG post conference:
• The Board is intended to operate with the Executive wing of Government but a clear and transparent relationship with the Somali Parliament and all statutory created bodies will be important. The exact nature of that relationship and reporting requirements will be agreed, including whether the JFMB will require Somali legislation.
• The final composition of Board membership.
• The Board will be established by agreed Terms of Reference which will set out in detail the scope and nature of the decision-making to be carried out by the Board and its operational level.
• The Board will function according to agreed Rules of Procedure that ensure sustained engagement by both donors and TFG on transparency/accountability issues.
• Issues that will be included in the Terms of Reference and Rules of Procedure include, but are not limited to:
o Chairmanship;
o Frequency and location of meetings, definition of quorum for discussion and decision making;
o Scope of decision making powers, criteria for decision making and basis of agreements;
o Staffing issues;
o Relationships with implementing partners and other donors;
o Nature of engagement in revenue flows (e.g. single treasury account), expenditure supervision (e.g. cash management committee with joint signatory required), procurement;
o Security arrangements.
• The Board will take time to become fully operational and will need to take an incremental approach. The sequencing of this approach will need to be agreed between members.
1. The London Conference on Somalia took place at Lancaster House on 23rd February 2012, attended by fifty-five delegations from Somalia and the international community.
2. We met at a key moment in Somalia’s history. Somalia is emerging from the worst humanitarian crisis in the world. African and Somali troops have pushed Al Shabaab out of Mogadishu and other areas. The transitional institutions come to an end in August 2012, and the people of Somalia want clarity on what will follow. The situation remains precarious, and in urgent need of support from the international community.
3. Decisions on Somalia’s future rest with the Somali people. The Somali political leadership must be accountable to the people. The international community’s role is to facilitate Somalia’s progress and development: our strength is in unity and coordinated support to Somalia. We noted the importance of listening to and working with Somalis inside and outside Somalia, and welcomed their engagement in the run-up to this Conference.
4. The Conference focussed on the underlying causes of instability, as well as the symptoms (famine, refugees, piracy, and terrorism). We, the international community, agreed: to inject new momentum into the political process; to strengthen AMISOM and help Somalia develop its own security forces; to help build stability at local level; and to step up action to tackle pirates and terrorists.
Political
5. We agreed that the Transitional Federal Institutions’ mandate ends in August 2012. There must be no further extensions. We welcomed the agreements that chart the way towards more representative government: the Transitional Federal Charter, the Djibouti Agreement, the Kampala Accord, and the Roadmap. We welcomed the progress represented by the Garowe Principles, endorsed the priority of convening a Constituent Assembly, and emphasised that the Assembly must be representative of the views of the Somali people of all regions and constituencies, and that women must be part of the political process. In line with Garowe II, we agreed to incentivise progress and act against spoilers to the peace process, and that we would consider proposals in this regard before the Istanbul Conference in June.
6. The Conference recognised the need for the international community to support any dialogue that Somaliland and the TFG or its replacement may agree to establish in order to clarify their future relations.
7. We condemned terrorism and violent extremism, whether perpetrated by Somalis or foreigners. We called on all those willing to reject violence to join the Djibouti peace process. We agreed to develop a defectors’ programme to support those who leave armed groups.
8. We emphasised the urgency of Somalia funding its own public services, and using its assets for the benefit of the people, as well as tackling corruption. We welcomed the progress that has been made in establishing a Joint Financial Management Board to increase transparency and accountability in the collection and efficient use of public revenues, as well as international development aid, and which will help strengthen Somali public financial management institutions. A declaration by the initial members of the JFMB is at Annex A.
9. Respect for human rights must be at the heart of the peace process. We called for action to address in particular the grave human rights violations and abuses that women and children face. We emphasised that journalists must be able to operate freely and without fear. Civilians must be protected. We called on the Somali authorities to take measures to uphold human rights and end the culture of impunity. We agreed to step up international efforts including through the UN human rights architecture.
Security and Justice
10. We agreed that security and justice were essential both to a successful political process and to development. Better security could only be achieved sustainably in parallel with better justice and the rule of law.
11. We expressed gratitude to those countries whose troops had served as peacekeepers and paid tribute to the achievements and sacrifices of AMISOM and other forces. We welcomed joint planning by the UN and African Union and reiterated the importance of effective command and control. We welcomed the adoption of UN Security Council Resolution 2036, which expands AMISOM’s mandate and raises the troop ceiling. We encouraged AMISOM to ensure the protection of civilians. We encouraged partners, especially new donors, to contribute to funding for AMISOM, including through the EU.
12. We agreed that, over time, Somalis should take over responsibility for providing their own security and develop their own justice systems to deal with the threats to their security and improve access to justice. We noted that Somalis themselves must decide what security and justice arrangements they need.
13. We acknowledged the good work underway in supporting the Somali security and justice sectors. We agreed that we would build an international framework of partners in order to bring much needed coordination and focus to those efforts, underpinned by a set of principles at annex B, and working closely with the UN’s Joint Security Committee.
Piracy
14. We reiterated our determination to eradicate piracy, noting that the problem requires a comprehensive approach on land as well as at sea. We expressed our concern that hostages in Somalia are being held longer and with more use of violence. We welcomed the work of the Contact Group on Piracy off the Coast of Somalia. We also welcomed the success of international military efforts, and remain committed to such efforts with robust rules of engagement and sufficient force generation. We agreed that piracy cannot be solved by military means alone, and reiterated the importance of supporting communities to tackle the underlying causes of piracy, and improving the effective use of Somali coastal waters through regional maritime capacity-building measures. We welcomed those initiatives underway and agreed to coordinate and support such initiatives better. We called for full implementation of the Djibouti Code of Conduct and the adoption of an Exclusive Economic Zone. We look forward to reviewing progress including at the Piracy Conference in the UAE in June.
15. We welcomed the efforts of partners in industry against piracy, and called for greater take-up of Best Management Practice on ships. We welcomed current work on international guidance on the use of private armed security companies.
16. There will be no impunity for piracy. We called for greater development of judicial capacity to prosecute and detain those behind piracy both in Somalia and in the wider region and recognised the need to strengthen capacity in regional states. We welcomed new arrangements, which enable some states and naval operations to transfer suspected pirates captured at sea for trial by partners across the Indian Ocean region, and if convicted, to transfer them to prisons in Puntland and Somaliland which meet international standards. We noted the intention to consider further the possibility of creating courts in Somalia specialised in dealing with piracy.
17. We reiterated our determination to prosecute the kingpins of piracy. Recognising work already undertaken, we agreed to enhance coordination on illegal financial flows and to coordinate intelligence gathering and investigations. We noted the establishment of a Regional Anti-Piracy Prosecutions Intelligence Coordination Centre in the Seychelles.
Terrorism
18. Terrorism poses a serious threat to security in Somalia itself, to the region, and internationally. It has inflicted great suffering on the Somali population. We agreed to work together with greater determination, and with full respect for the rule of law, human rights, and international humanitarian law, to build capacity to disrupt terrorism in the region, and to address the root causes of terrorism. We agreed on the importance of disrupting terrorists’ travel to and from Somalia, and on the importance of disrupting terrorist finances, and called on countries in the region to implement the Financial Action Task Force’s recommendations on combating money laundering and the financing of terrorism. We noted that effective intelligence gathering and investigation, and support to the Somali criminal justice system, were critical to the fight against terrorism. We agreed to work with the Global Counter Terrorism Forum and other international and regional bodies to deliver this important work.
Stability and Recovery
19. We welcomed the success in some areas of Somalia in establishing local areas of stability, and agreed to increase support to build legitimate and peaceful authorities, and improve services to people living in these areas. We acknowledged the importance of creating the conditions inside Somalia for durable solutions for the displaced that respect international laws. We agreed that such efforts should promote local and regional cohesion, and converge with the national political process.
20. We considered the implementation of the Mogadishu Recovery and Stabilisation Plan important. We agreed to expand programmes to newly-recovered areas. We would focus support on enabling the delivery of immediate and sustainable benefits to ordinary Somali people: safety and security, economic opportunities and basic services. We would promote effective and accountable local administrations, and support the resolution of disputes.
21. We agreed that all support to local areas of stability should be in accordance with the New Deal for engagement in fragile states recently adopted in Busan, and build on the stabilisation strategies prepared by both IGAD and the Transitional Federal Government. We endorsed a set of principles to guide international support to local areas of stability in Somalia (Annex C). We agreed to continue funding local stability through existing programmes, and noted the establishment of a new Stability Fund to which a number of us will contribute[1].
22. We agreed that Somalia’s long-term reconstruction and economic development depended on a vibrant private sector, and that both aid and diaspora finance could develop Somalia’s considerable potential in livestock, fisheries and other sectors. We noted that stability was a prerequisite for most sustainable investments in infrastructure such as electricity, roads and water systems. We looked forward to further discussion on all these issues at the Istanbul Conference.
Humanitarian
23. The Conference was preceded by a separate meeting on humanitarian issues co-chaired by the United Nations and the United Arab Emirates. Notwithstanding the end of the famine, participants expressed concern at the ongoing humanitarian crisis, and committed to providing humanitarian aid based solely on need. They agreed a set of conclusions on humanitarian issues and linking relief with longer-term recovery (set out in a separate document).
International coordination
24. We agreed to carry forward work agreed at London through the International Contact Group on Somalia (ICG), and welcomed the ICG’s decision in Djibouti to look at restructuring to become more effective. We recommended that the ICG establish working groups on the political process, security and justice, and stability and development. We noted that, within the ICG, a core group of engaged countries would drive progress in support of UN, AU and IGAD efforts.
25. We welcomed the efforts of the Special Representative of the Secretary-General and the United Nations Political Office for Somalia (UNPOS) in facilitating progress in Somalia. We also welcomed the role of IGAD and the African Union, and the support of the League of Arab States, the European Union, and the Organisation of Islamic Cooperation. We encouraged effective coordination between UN entities working on Somalia. While recognising the still challenging security situation in Somalia, we welcomed UNPOS’ relocation to Mogadishu and agreed that we would aim to spend more time on the ground in Somalia in order to work more closely with Somalis on the challenging tasks ahead.
Conclusion
26. We expressed the hope that a new era of Somali politics, supported by the international community, will bring peace to Somalia. We are determined to place the interests of the Somali people at the heart of all our actions. We looked forward to the day when the situation in Somalia would have made sufficient progress for an international conference to be held there. In the meantime, we will redouble our efforts to support the people of Somalia in their search for a better future for their country.
London - 23 February 2012
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Annex A
DECLARATION BY THE INITIAL MEMBERS OF THE JOINT FINANCIAL MANAGEMENT BOARD AT THE LONDON CONFERENCE
Thursday, February 23, 2012
Establishing the Joint Financial Management Board (hereafter “the Board” or “the JFMB”) is a positive response to the spirit and letter of commitments already entered into by the Transitional Federal Government (TFG) and members of the international community.
On 9 September 2011 in Nairobi, the Heads of State and Government of the East African Community (EAC), the Inter-Governmental Authority on Development (IGAD) and the Republic of South Sudan solemnly declared in paragraph xi (12) of the Joint Declaration of ‘The summit on the Horn of Africa crisis: Ending drought emergencies: A Commitment to Sustainable Solutions’ to undertake: “the formation of a Joint TFG-Donor Financial Management Board, to manage all financial resources provided to the TFG from both internal and external sources.”
On 30 September 2011 in Copenhagen, the International Contact Group (ICG) recommended in the Final Communiqué: “The establishment of a Joint TFG-Donor Financial Management Board as recommended by the Horn of Africa Summit in September 2011.”
Currently, the initial members of the JFMB are the Transitional Federal Government (TFG) of Somalia, or any future successor government of Somalia; the United Kingdom; the French Republic; the European Union; and the World Bank. It is the expectation of the members that the Board will be expanded to include other donors before it is formally established.
Initial members agree the following:
Aims:
• The Board aims to eliminate the diversion of revenues generated from national assets and received in external assistance.
• The Board aims to maximise the productive use in the public interest of revenues generated both by Somalia’s national assets and received in external development assistance.
• The Board also aims to provide accountability and transparency on where and how Somali revenues and donor funds are spent.
Objectives:
• To establish a joint Board with key donor and Somali membership for the purpose of increasing mutual accountability and transparency; and an operational level with the task of forging joint structures with international and Somali counterparts at critical points in the TFG financial environment.
Principles of engagement:
• The Board will seek accountability from Somali public finance institutions for public revenues and expenditures. Simultaneously the Board will seek greater transparency and accountability from international donors and implementing agencies for aid commitments and more effective and efficient implementation of aid.
• The Board should have access to full information concerning financial flows both from internal revenue streams and for external assistance.
• The Board is intended to be a temporary body, the need for which will diminish as Somali public finance institutions become strong enough to manage public finances and prevent diversion.
• The mandate of the Board will be further defined in discussion between the TFG and development partners. A progress review will take place at the end of the mandate.
• The Board is intended to strengthen the ability of Somali public finance institutions to manage Somali public finances and to monitor donor funds.
• The operations of the Board should be, to the extent practical, within Somalia.
• The Board should enhance the sovereignty of the Somali state by building trust between the Somali authorities and international community.
Scope of the Board:
• Internal revenue includes domestic financial flows that are or should be characterized as public resources, including what are or should be national or public assets.
• External assistance includes all donor funds sent to or intended for Somalia whether multilateral or bilateral and whether given to an institution or individual holder of public office.
Establishment:
The President, Prime Minister and Minister of Finance of the TFG will initially represent the TFG on the JFMB. The head of state, head of government and minister of finance or equivalent of any future successor government of Somalia will represent that government on the JFMB. Additional TFG or Somali government representatives may be added under processes established by the JFMB.
The admission of new members will be guided by the standards of accountability and transparency of the prospective member, and the JFMB will establish relevant criteria for the purpose.
Operational Level:
The Board will be supported by an operational level structure. International and Somali counterparts will be identified and appointed for support at critical financial points.
Funding Mechanism:
• Initially, costs of the JFMB will be borne by individual members of the JFMB.
• It is the intention of the parties that as the Somali government maximizes revenues, the running costs of the Board will at some point be shared between international members of the Board and the Somali government.
Next Steps:
Agreement will be reached on the following areas in discussions between development partners and the TFG post conference:
• The Board is intended to operate with the Executive wing of Government but a clear and transparent relationship with the Somali Parliament and all statutory created bodies will be important. The exact nature of that relationship and reporting requirements will be agreed, including whether the JFMB will require Somali legislation.
• The final composition of Board membership.
• The Board will be established by agreed Terms of Reference which will set out in detail the scope and nature of the decision-making to be carried out by the Board and its operational level.
• The Board will function according to agreed Rules of Procedure that ensure sustained engagement by both donors and TFG on transparency/accountability issues.
• Issues that will be included in the Terms of Reference and Rules of Procedure include, but are not limited to:
o Chairmanship;
o Frequency and location of meetings, definition of quorum for discussion and decision making;
o Scope of decision making powers, criteria for decision making and basis of agreements;
o Staffing issues;
o Relationships with implementing partners and other donors;
o Nature of engagement in revenue flows (e.g. single treasury account), expenditure supervision (e.g. cash management committee with joint signatory required), procurement;
o Security arrangements.
• The Board will take time to become fully operational and will need to take an incremental approach. The sequencing of this approach will need to be agreed between members.
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