USAID cuts had 'severe impact' on Somalia's economy, says development bank chief

LONDON, Oct 21 (Reuters) - The closure of the U.S. Agency for International Development earlier this year hit Somalia's economy and tax revenues, the head of the country's development bank said on Tuesday.

"In Somalia (it) really impacted our GDP," Hodan Osman, president of the Somali Development and Reconstruction Bank told the Financial Times Africa Summit in London on Tuesday.

She said aid cuts reverberated in the economy in ways authorities didn't expect, hurting economic activity and impacting sales tax revenues for the government.

U.S. President Donald Trump has slashed the country's foreign aid budget, and shuttered USAID earlier this year. The agency had supported health, education and development worldwide.

But Osman said the country faced a broader economic hit. "It also had (a) severe impact just on the economy alone that we weren't really thinking about," she said.