Somalia's GDP per capita 2012

[Chimera]

1985-1990

 

Somalia - $836

Kenya - $300

Ethiopia - $120

Tanzania - $200

 

In today's money that would amount to

 

Somalia - $2508

Kenya - $900

Ethiopia - $360

Tanzania - $600

 

We know countries like Ethiopia and Kenya made significant gains in growth annually, hence why their current GDP per capita is higher than the above figures in today's money. However, Somalia never declined in terms of annual growth, if we are to believe the CIA world factbook, there was an annual growth rate of 2.4% (most likely a very conservative estimate). Therefore for Somalia to have a current gdp per capita of $600, there would have to have been a significant drop to $200 in the 1990s, but no such drop ever occurred. Instead a decline of two hundred dollars based on prewar govermental inflation was taken into account and the figure of $600 was from then on permanently cemented in all the studies and journals on the economy of Somalia simply out of convenience rather than accuracy.

 

Is there politics behind this? It would look very strange for a 'failed state' to be economically richer than all of its neighbours,, not to mention it would increase the economic clout of the country to between $25 billion -$30 billion, and place the country in the top 15 of Africa. The static figures are almost comical, and mathematically illogical. I believe the Central Bank of Somalia should issue a rebasing of the economy as soon as possible to determine the size of the economy, and incorporate the informal sector.

 

The 1990 economy is completely different from the 2012 economy.

[Naxar Nugaaleed]

Lets keep in mind that one country population is 8 million, another 40 and last almost 80 respectively

[Chimera]

Somalia is 10-12 million. However this is to our advantage, our resources have a greater effect on the overall welfare of the country. An export volume of $2.5 billion has a higher impact on Somalia than it has on Kenya and Ethiopia. A remittances figure of $2.6 billion translates into a bigger piece of the pie than for our neighbours,

 

Eritrea is making 17 + % gains a year. That's roughly an extra 0.5 billion added every year to their economy, however in per capita terms its massive because of the small population, which would take a country like Ethiopia many years to replicate.

[Naxar Nugaaleed]

There is no spinning this, I find the whole idea of equating Somalia with the two largest economies in East Africa funny carry on

[Chimera]

Naxar Nugaaleed;881778 wrote:

There is no spinning this, I find the whole idea of equating Somalia with the two largest economies in East Africa funny carry on

I don't understand what you're trying to convey, but give me Switzerland over China any day of the week my friend. When I say Somalia's sizable population is a boon rather than a disadvantage its no spin. The 'Largest economy' tag doesn't equal most efficient and beneficial to the average citizen.

 

A 100 billion economy translates for Somalia into a GDP per capita of $10000, while for Ethiopia it translates into a $1200 GDP per capita, hence the spending power of the average Somali would be far greater when it utilizes all of its resources.

[GaraadMon]

I think people fail to realize how massive our country is. Our population, whether it be 8 or 17 million is rather small, but lean (young population). Economic gains in the agriculture, livestock and fishery sectors alone would provide massive revenues for nation building.

 

The only issue that needs to be dealt with in Somalia as well as every other African nation, is integration. The difference between a subsistence cattle herder in Ethiopia and a rancher in Alberta is that the rancher knows what his product is worth and can sell his byproducts to other sectors (leather for skin, bone for gelatin and cosmetics etc.). The business community needs to educate farmers and livestock owners, so that they may make greater profits and purchase technology and business acumen that staves off the effects of the ever-common drought.

 

As Chimera has stated, our small population will mean the effects of economic growth will be more potent.

[Chimera]

Exactly Blackflash, each of the neglected and badly managed industries you mentioned potentially could reap billions in revenue. The coastal belts, the fertile regions, the urban areas all would see their standards of living rise with the right economic policies in a time-span much faster than any of its larger neighbours. A single factory has a much broader effect in Somalia than it would have in either Kenya or Ethiopia. The distribution of these same jobs and wealth would be amongst a smaller population, which translates into every Somali family and individual having a higher spending power, which in turn would result in a strong consumer based economy, and more taxes for the Federal government. This means better infrastructure, a flourishing retail sector and higher standards of living.

[Raamsade]

But Chimera Somalia's economy in the 1980s was buoyed by a gargantuan foreign aid. I once read somewhere that Somalia was, on per capita basis, the highest net Official Development Assistance (ODA) recipient. How much of those of economic indicators are true reflection of economic activity and how much is reflection of bloated assistance?

[Chimera]

All African countries were, but in Somalia's case that was taken into account in 1991 when the per capita figure declined from $836 to $600. Even then the closest estimate to the actual 2012 GDP per capita figure would be $1800 today based on the 1990s economy and current dollar exchange rates. A rebasing of the economy factoring in the vibrant private-sector, the myriad of new companies and the $2.6 billion worth of remittances, could push that estimate even higher.

 

Somalia is the only country featured in economic indexes with a static $600 figure 20 years straight, while accompanied by 2.4% growth annualy LOL.

[Somali philosopher]

How much did the inflation rate change in the last 20 years

[Raamsade]

^Astronomically but the old Somali shilling is surprisingly still in use.

 

Chimera, remember that GDP (whether at official exchange rates or at PPP) is grossly understated for developing countries since GDP only captures market activities and totally side-steps the informal sector. The informal sector, which isn't captured by official economic activity indicators, is huge in developing countries sometimes accounting for nearly half of all economic activity. The actual GDP of our neighbours are probably double what you posted.

[GaraadMon]

Raamsade;882450 wrote:

^Astronomically but the old Somali shilling is surprisingly still in use.

 

Chimera, remember that GDP (whether at official exchange rates or at PPP) is grossly understated for developing countries since GDP only captures market activities and totally side-steps the informal sector. The informal sector, which isn't captured by official economic activity indicators, is huge in developing countries sometimes accounting for nearly half of all economic activity. The actual GDP of our neighbours are probably double what you posted.

Agreed. There is really little information on African economies due to lack of intergration, no one earns more than the minimal amount needed to surve and even if they do, there isn't much of a business community with whom they may exchange services and expand.

 

It'll be years before anyone has any idea of what Somalia's economy looks like, here are Somalia's exports according to MIT and Harvard:

[Timur]

Chimera, what is your source? There is no detailed source that has ever recorded Somalia's per capita GDP being that high. The World Bank has a very nice tool via Google which lets you look at Somalia's GDP per capita from 1960 to 1990. It's the most detailed data bank out there and it has plenty of other information besides just that. Below is a World Bank chart chronicling Somalia's per capita GDP, which for the vast majority of the 1970s and 80s was the lowest on earth.

 

http://i.imgur.com/uheNh.jpg

 

According to the World Bank chart above, if we look back to 1985, as you suggested in your title, Somalia's per capita GDP was only $137 as I've pinpointed for you; it was the lowest in Africa, and the world. For two consecutive decades (most of the 70s and 80s), Somalia competed with Burundi in the bottom of Africa's per capita GDP rankings, and unfortunately Burundi still came out stronger almost every year. In fact, the highest per capita GDP ever recorded for Somalia was a mere $178, which would be roughly $500-600 in today's terms.

 

It's fascinating to me that many Somalis have a rosy view of their country prewar, as if it was perfect, though in reality it was equivalent to today's Burundi or Burkina Faso, just another minor and forgettable banana republic.

 

I just came here to post the facts since no one was providing sources for their wild guesstimates. I'm not here to argue if this information is the most accurate, but it is the only information that is recorded soundly (unless someone provides another data bank). And according to this information, Somalia was destined to go nowhere.

 

I'm also a bit shocked at the lack of professionalism by Chimera, making up numbers with absolutely zero sources, and basing an entire essay on those fictional numbers. In fact, if you google "Somalia $836" with or without the quotations, Chimera's topic is literally the only thing on the entire world wide web that accurately matches that description.

[Chimera]

The figure I posted wasn't something I made it up, its from the 'Better Off Stateless' study by Peter Leeson, a simple google search should have redirected you there. There are other economic studies that corroborate my above figures, and actually place the GDP per capita higher than what I initially stated. Here is a comprehensive table from the Development Centre Studies The World Economy Historical Statistics by Angus Maddison

 

The World Economy: Historical Statistics is a book by Angus Maddison. Published in 2004 by the OECD Development Centre, it studies the growth of populations and economies across the centuries: not just the World Economy as it is now, but how it was in the past.

 

Among other things, it showed that Europe's GDP per capita was faster progressing than the leading Asian economies since 1000 AD, reaching again a higher level than elsewhere from the 15th century,[1] while Asian GDP per capita remained static until 1800, when it even began to shrink in absolute terms, as Maddison demonstrated in a subsequent book.[2] At the same time, Maddison showed them recovering lost ground from the 1950s, and documents the much faster rise of Japan and East Asia and the economic shrinkage of Russia in the 1990s.

 

The book is a mass of statistical tables, mostly on a decade-by-decade basis, along with notes explaining the methods employed in arriving at particular figures. --

Source

Burundi was never on Somalia's level, what an absurd claim, even today its per capita income is lower than the 'supposed figure' of war-torn Somalia, yet we are to believe these generalised World Bank figures? Drawn from nothing? Completely contradicting multiple sources including government publications? I rather not! At least Angus Maddisson draws his figures from a myriad of studies, economists, and specialises in the historical timeline of economic statistics, compared to an International Bank more concerned with extending high-interest loans, and the poorer the country, the more influence they have. Therefore they have a clear bias in promoting African countries as basket-cases with 'bad credit'.

 

Somalia was certainly destined to go somewhere, you can tell from the high GDP per capita figures in the 1970s when factories and businesses were in full swing, when farms and livestock turned the country self-sufficient and when trade was bustling. The numerous conventional wars and internal instability clearly contributed to the decline. If Somali politicians could have ensured the military didn't eat all the government funds, banned food-aid and initiated better economic plans, the country would easily have the highest GDP per capita in the region today, as it did for decades in the prewar era, largely to do with its sizable population, strategic location, multiple panamax ports and high-value crops.

 

Spare me the clap-trap about prewar Somalia. I don't need that from a regionalist, your a self-proclaimed Puntlander, if prewar Somalia and the aforementioned entity were two seperate places, prewar Somalia would outshine it in every way possible, from military, to economics, to cultural clout, to education and healthcare. All of the major infrastructure in Puntland comes from that era. If Somalia was what your trying to portray it as, what the hell is modern day Puntland? It can't be good!

 

Sorry if that's too unprofessional of me, but you attempted a dose of realistic persepective, and I replied in kind. We however both know the words in the above post aren't really yours.

[Timur]

The figure you posted is in GEARY-KHAMIS dollars, which is a hypothetical unit of currency used to measure standard of living. Life in Somalia was cheaper than life in Burundi or Kenya, obviously, and that's why it ranks well for the Geary-Khamis ranking. However, in actual production, Somalia was worse off than Burundi and far worse off than Kenya. We produced nothing, but we also imported very little, which made things balance out. It STILL doesn't excuse the fact that Somalia produced less than Burundi per capita.

 

It's pathetic that you brush off the World Bank stats in favor of your own imagination. You are either a troll, or you refuse to believe anything other than your own myths. The fact that you went this far into the topic running on your own assumptions and beliefs tells me you are not serious at all.

 

If you can bring facts relating to direct production per capita, do so. Otherwise, none of what you say has merit without a credible source, unless of course you want to make up conspiracies for why you don't trust them.