Somalia continued to suffer from drought and sporadic terrorist attacks in 2017. These developments have hurt economic activity, particularly in the north of the country and in rural areas, and temporarily impacted tax collection efforts of the Federal Government of Somalia. However, the authorities have navigated through these challenges, and, with sustained support from the international community, the country has avoided a significant economic slowdown. Program performance was broadly satisfactory at end-June and end-September 2017. On the December program targets, the authorities recently stepped up their efforts by implementing several critical tax measures, which are expected to keep the program on track. This is a testament to the continued strong commitment of the authorities to the SMP despite a very difficult environment.