The European Union has given Somalia 158 million euros or $200 million to improve education, the legal system and security, its new envoy said on Saturday, as the Horn of Africa nation tries to recover from more than two decades of conflict.
The new aid program follows the election in September of a new Somali president, the culmination of a regionally brokered, U.N.-backed effort to restore central government control and end fighting that has killed tens of thousands of people.
President Hassan Sheikh Mohamud, elected in the first vote of its kind since Somalia slid into civil war in 1991, is grappling with corruption, an Islamist insurgency and piracy along the country's strategic Indian Ocean shipping route.
"After 21 years, the government is finally rebuilding the systems of a functional state at local, regional and central levels," Michele Cervone d'Urso, the EU's special envoy to Somalia, told Reuters.
"The EU is more committed to work directly and in partnership with Somalis. We will ask the implementing agencies to work more closely with the government and civil society."
A suicide bombing in the capital Mogadishu on Saturday highlighted the challenges faced by the new Somali leader .
The development aid package, the largest EU programme ever approved for Somalia, will go towards strengthening the judiciary, broken state institutions, the Somali police force and the country's blighted education system.
Some funds will be used to bring home Somali professionals abroad to help improve education standards.
In the past, Western and regional states have pumped in millions of dollars of humanitarian aid to help Somalis affected by conflict and frequent natural disasters. African governments have sent troops to combat al Qaeda-affiliated militants.
President Mohamud called for more aid, and for assistance to be channelled directly through the new government.
"Although there is global economic crisis, our new government has been requesting the world to increase funds and change the ways Somalia has been getting funds in the last two decades," Mohamud told a news conference in Mogadishu after the launch of the aid programme.
"We requested them to have direct a relationship with Somalia."
Despite being on the back foot, al Qaeda-linked al Shabaab militants still control swathes of rural southern and central Somalia. Pirates and local militia groups are also fighting for control of chunks of territory.
Additional reporting Abdirahman Hussein; Editing by George Obulutsa and Rosalind Russell