The central message of this Systematic Country Diagnostic (SCD) update is that Somalia should accelerate the momentum in building its institutions to develop resilience and create jobs, thus serving as a basis for transitioning from fragility to reducing poverty and promoting shared prosperity. Poverty remains widespread, with growth and job creation insufficient for lifting incomes. The SCD update uses data from the 2022 Somalia integrated household budget survey (SIHBS), which is the first comprehensive household budget survey undertaken since the collapse of the state in 1991. Since SCD1, there have been modest improvements in some non-monetary dimensions of welfare. Somalia has benefited from new sources of financial support, which are helping to strengthen institutions through the advancement of the debt relief process. This SCD update reaffirms that the binding constraints and priorities presented in SCD1 remain valid. The SCD update presents five high-level outcomes (HLOs) that consider the progress made since SCD1, as well as the availability of new analytical work.