Somali economic news

[Haatu]

Somali government to modernise salary payment system

 

SABAHI

By Adnan Hussein in Mogadishu

Saturday, January 26, 2013

 

The Somali government will launch a new programme in April to pay government employees through an automated system controlled by the Central Bank of Somalia.

Minister of Finance and Planning Mohamud Hassan Suleiman told Sabahi that the programme is one of several initiatives aimed at modernising the country's financial system, balancing the budget, and curbing administrative and financial corruption.

 

Government employees currently are paid in cash by designated accountants in their respective ministries after funds are disbursed from the Central Bank. The accountants are responsible for collecting the funds from the bank and paying each employee after he or she signs a paper receipt of acknowledgement.

 

The process, which involves physically withdrawing and transporting large quantities of cash and filling out paper forms, often leads to delays in payments and misplacement of funds, Suleiman said.

 

The minister said the new system will prevent such delays and lead to better accountability and transparency in the management of public funds.

 

With the automated payment system, every civil servant will be issued an individual account at the Central Bank where their salaries will be transferred and accessible via a bank card at the beginning of each month.

 

The government also plans to levy taxes on cash remittance companies, telecommunication companies, qat, cigarettes, and on vendors in local markets, he said. Tariffs will also be imposed on goods coming through the ports of Mogadishu, Kismayo, Bosaso and Berbera.

 

"We will fight administrative and financial corruption and will implement plans that will allow us to collect more taxes and keep our promises to serve the Somali people," Suleiman told Sabahi.

 

Transparency International, a global civil society watchdog against corruption, ranked Somalia, Afghanistan and North Korea as the most corrupt out of 176 countries in its 2012 index.

 

Turbulent market situation

 

The government must take more steps to manage public funds in an effort to stabilise the economy, analysts told Sabahi.

 

Economist Bashir Mardadi Salah said a law should be enacted to ensure that salaries of public servants are paid in Somali shillings in order to stabilise its value against foreign currencies. Currently, foreign currency reserves in the Central Bank are estimated at $17 million and are declining at an accelerating rate, he told Sabahi.

 

Salah said the government should retain any foreign currency it has to build its reserves and bring into circulation the stacks of Somali shillings that were commissioned for printing during the transitional period but have not yet been released.

 

Economist Hiba Abdi Khalif said that strengthening the Central Bank's position will also help halt the manipulation of currency exchange rates by unregulated independent traders.

 

Even though Somalia's Central Bank re-opened in 2009, independent traders control exchange rates and are able to manipulate the market. Over the years, she said, traders have taken advantage of the economic turbulence created by the lack of regulations and the shortage of Somali shillings available for circulation to manipulate the exchange rates in their favour.

 

Khalif warned against the failure of the Ministry of Finance and Planning to arrest individuals involved in rate exchange manipulation, which has affected the lives of many Somali families that depend on remittances sent from abroad.

 

On January 17th, Somali President Hassan Sheikh Mohamud appointed economist Abdisalam Omer as the new governor of Somalia's Central Bank. Omer has worked at the World Bank and holds a doctorate in public administration from the University of Tennessee in the United States.

 

Source: Sabahi

 

http://www.hiiraan.com/news4/2013/Jan/27857/somali_government_to_modernise_salary_payment_system.aspx

[Haatu]

Sabti, Jannaayo 26, 2013 (HOL) —Xukuumadda Soomaaliya ayaa sheegtay inay wax ka qabanayso hoos u dhaca ku yimid shillinka Soomaalga iyo sirir bararka raashinka, iyadoo wasiirka maaliyadda uu sheegay inay qaadi doonnaan tallaabo ay wax uga qabanayaan arrinaas.

 

Maxamuud Xasan Suleymaan oo la hadlayay idaacadda dowladda ee Radio Muqdisho ayaa sheegay in qorshahoodu uu yahay mid ay ku doonayaan inay ku xakameeyaan isbedelka ku imaanaya sarifka lacagaha oo aan sal lahayn tan iyo markii ay dhacday dowladdii dhexe ee Soomaaliya.

 

“Waxaan la soconnaa in safirka doollarka uu hoos u dhacay, maciishaduna ay weli kacsan tahay, waxaana sababay arrintaan lacagta doollarka oo si aad u soo gashay suuqyada iyo lacag shillin Soomaali ah oo dhawaan ku gubatay Boosaaso,” ayuu yiri wasiirka maaliyadda.

 

Hoos u dhaca ku yimid sarifka lacagta doollarka ah ayaa wuxuu saameyn xooggan ku yeeshay dadka danta yar iyo kuwa lacagaha ka hela dibadda, iyadoo aanay jirin wax hoos u dhac ah oo ku yimid qiimaha lagu iibsado raashinka.

 

“Xukuumaddu waxay dadaal u galaysaa sidii ay isbedelka lacagta wax uga qaban lahayd, innagoo la kaashanayna arrintaas hay’adaha maaliyadda ee dowladda,” ayuu yiri wasiirka maaliyadda dowladda Soomaaliya.

 

Wasiirku wuxuu hadalkiisa ku daray inay lacag keenayaan si ay wax uga qabtaan fadhi la’aanta sarifka lacagta adage e doollarka, isagoo qiray inay ka tabaabusheysanayaan in sidaan oo kale aysan dhicin.

 

Sarifka doollar ayaa waxaa maalmo ka hor lagu sarrifayay halkii doollar doollar - 22,000 oo shillin Soomaali ah, halka uu maanta ka yahay 19000 oo shillin Soomaali ah, iyadoo suuqyada safirka lacagaha ay maamulaan shirkado gaar ah loo leeyahay iyo ganacsato.

 

Maxamed Xaaji Xuseen, Hiiraan Online

maxuseen@hiiraan.com

Muqdisho, Soomaaliya

 

http://www.hiiraan.com/news/2013/jan/wararka_maanta26-20675.htm

[oba hiloowlow]

splendid news

[Haatu]

African Union Mission in Somalia (AMISOM) combat engineers repair and grade a stretch of road leading to the town of Afgooye in Somalia's Lower Shabelle region along the main route linking the fertile agricultural region with the capital Mogadishu, Jan. 24, 2013. (photo by REUTERS/AU-UN IST PHOTO/Stuart Price/Handout)

 

AS-SAFIR

By: Mahmoud Mohammad Hassan Abedi Translated from As-Safir (Lebanon).

Monday, January 28, 2013

 

Are emerging signs of international interest in Somalia's stability hiding investment projects in lucrative economic sectors, such as oil, gas and mining? The majority of Somalis are from rural areas, or work in government agencies and offices. They live in a state-sponsored economy, where the state is the main merchant and the sole provider of major services; it is in charge of all parts of life. Yet Somalis have been steadfast, despite the huge human losses during the years of conflict, and despite the lack of stability. They will have to employ the experience they earned through this steadfastness and conflict in order to pick up on signs of hope in the transition from steadfastness to recovery.

 

Grazing, fishing and agriculture

 

The Somali people depend on agriculture and animal husbandry as their main source of income. Approximately 80% of the population works in this field. About 10 million people live in Somalia, a country with an area of 633,000 square kilometers. The presence of two rivers, along with the abundant rainfall in the highlands of the north, create an environment suitable for grazing and agriculture. Somali clans own the largest number of camels in the world, estimated at 7 million and accounting for 50% of the world's camels.

 

There has been a big jump in the export of Somali livestock, especially after Gulf states lifted their ban on importing the country's livestock. In 2010, Somalia exported 4.3 million camels, cows and sheep. The country also has a diverse range of agricultural crops, from grains to legumes to fruits. The agricultural sector accounted for 47% of the country's exports and 17% of its imports in 2001. The country has the potential to produce 200,000 tons of fish per year, without causing a negative impact on the renewal of the natural reserves of marine species. Work has begun on the production of canned fish in the town of Las Qouri on the northern coast. It is no secret that the clash between local fishermen and foreign vessels over foreign waste was the main impetus behind the violent local reaction to defend the county's marine resources in the absence of the state. This later transformed into widespread piracy.

 

Industry and ports

 

Industry, the third largest sector in the country, provides for 5% of Somalia's total GDP. This sector's activities are focused on food industry — such as canned goods, beverages, oil presses, sugarcane and pasta production — along with processing industries such as leather, oil, sugar and salt processing, and chemical industries such as the manufacture of cleaning agents.

 

Ports have provided a golden opportunity for regional business. Ports such as Berbera, Bosaso, Mogadishu and Kismayo have become conduits for transporting large quantities of goods to consumers in Djibouti, Ethiopia, Kenya and southern Sudan. The value of goods passing though the port of Mogadishu is estimated at $1 billion per year, while the return on customs at the port of Berbera is estimated at $70 million to $100 million annually. The geographical location of Somalia — given it's proximity to South Asia, the Middle East and eastern Africa — is important in this regard.

 

War economy: a Kalashnikov for $140

 

The absence of the state, since the collapse of the "socialist" system in the beginning of the 1990s, is a major cause behind the subsequent significant economic changes in the country. A lot of national capital has been invested in regional neighboring countries. Somalis established real estate development projects in Kenya and Djibouti, and also entered into the real estate sectors in Dubai and Ajman. Moreover, the absence of the state was a factor in Somalis working and investing in the service sector, due to the deterioration of basic infrastructure in the country, particularly the roads. Statistics indicate that 88% of roads in the country are unpaved, while the rest of the paved roads (2,608 km) are in need of extensive maintenance and development. The same is true for the country's airports and seaports.

 

However the absence of the state, alongside the state of chronic conflict characterizing large areas of the country, were behind the emergence of the war economy. The entirety of the country transformed into a black market. Anything could be entered into the black market; anything could be bought or sold, imported or exported, shipped or smuggled. Piracy, arms trafficking and illegal immigration all played a major role in this arena.

 

Despite the international ban on arming Somalia, the country became an open market and way station for all types of light and medium weapons heading in all directions. Here we must mention the name of the most important market in east Africa for goods and weapons: the Bakaara Market in Mogadishu. This market includes over 400 dealers selling "potent" weapons. It is a paradise for those interested in buying weapons, in terms of both quality and price. A Kalashnikov assault rifle costs no more than $140. Prices can increase depending on the quality, with some weapons costing up to $1,000 — the price of a Russian-made pistol. Yet you can buy a land mine for only $100 and a hand grenade for $25. The amount of arms owned by civilians exceeds the amount owned by the weak state by between five to seven times.

 

Piracy generates money for villages

 

In the midst of acts of maritime piracy — which have changed the course of things for international shipping in the western Indian Ocean, the Gulf of Aden and the Red sea — ransom money is pouring into coastal villages in the states of Puntland and Galmudug. These villages have transformed into launching pads for pirates. Most of the money paid for ransoms, which amounted to $238 million in 2010, goes to anonymous patrons of piracy — members of international organized crime. Yet despite this fact, a single pirate receives at least $10,000-15,000 for each successful operation. The effect of this revenue is evident in increased construction and stimulated commercial trade in areas that were once deemed the poorest in the country. These are areas that had no resources other traditional fishing.

 

The birth of new occupations: gravediggers for example

 

Grave-digging is among the professions that generate rewarding profits, particular during periods of increased clashes in the capital, which claimed more than 18,000 victims in two years. The same goes for makers of coffins, those who deal sheets of iron — which have become an economical alternative to wood in coffin production — and dealers of white cotton fabrics for funeral shrouds…

 

The "new" economy

 

Somalia's GDP amounts to just over $5 billion annually (according to the CIA World Factbook), ranking 165th globally. National investment has increased in multiple projects, transforming the absence of the state — which could have been pursuing a policy of intervention — into a blessing for the private sector. The telecommunications sector grew, with eight national companies providing the most effective communication networks on the African continent. The Internet entered the country in the 1990s, reaching urban areas and remote villages alike. Moreover, "Zad" was launched, a program for making financial transactions via mobile phones.

 

Somali expatriates also developed successful working relationships with businessmen throughout the world, contributing to a growth in the commercial sector. Networks for transporting goods stretched between Asia and Africa, from China in the east to Senegal in the west.

 

With an increase in Somalis migrating abroad — escaping the war and in search of a better life — the remittance sector grew. This brought about an important economic resource and revenues, as Somalis secured easy means for the immediate transfer of funds. Somalis took it upon themselves to provide this service. A network of money transfer offices sprung up, covering countries throughout the world (144 countries). This sector has provided the national economy with $1 billion to $2 billion annually.

[Haatu]

A troubled framework

 

Continued turmoil in the south of the country has led to frequent waves of displacement. Hundreds of thousands of refugees have set out in all directions, whether inside the country or to neighboring states. The instability led to a large segment of the population losing their livelihoods and tools of trade, which they left behind in their search for safety and security.

 

This has put the displaced in a critical economic situation, completely exposed to fluctuations in weather that affect large areas of the country. This is particularly true given the recurring effects of El Nino, which is increasingly tough decade after decade. This has led to periods of severe drought, almost destroying the vegetation in vast areas of the country. These droughts have also killed many livestock, leading to hundreds of thousands of shepherds and agricultural workers and their families joining the destitute convoys of the displaced. It seems clear that they will not survive without urgent humanitarian aid.

 

The Somali people have overcome this situation with the least amount of aid. Moreover, when the aid arrived — if it ever arrived — it was subject to corruption on the part of offices of aid organizations, through corrupt officials, warlords and politicians. The aid was seasonal and in the end was as damaging to production cycles and the marketing of crops as were fluctuating environmental conditions.

 

The above article was translated from As-Safir Al-Arabi, a special supplement of As-Safir newspaper whose content is provided through a joint venture of As-Safir and Al-Monitor.

 

http://www.hiiraan.com/news4/2013/Jan/27879/despite_mounting_economic_woes_somalis_remain_steadfast.aspx

[Haatu]

Mogadishu, Somalia - Ali Hassan spends his day sitting in a former mosque, now a ramshackle shelter for drug users, idly staring at his cell phone as he waits for it to ring.

 

A gravedigger with more than 20 years of experience, Hassan is finding life in Mogadishu's newfound stability hard.

 

He became a gravedigger at the height of the civil war, when he used to dig at least 30 graves a day. "I became a gravedigger in 1991, when burying dead bodies was the best business in Somalia."

 

People who want to bury their deceased family members ring his cell phone to ask him to dig graves for them. He listens religiously to the cacophony coming from downtown Mogadishu for the sound of loud bangs or continuous rounds of fire.

 

"When there is a loud bang, we know it is an explosion. When there is a sustained gunfire, we know something is wrong and people may die. Deaths mean there will be business for us."

 

However, with gun battles falling in Mogadishu these days, the number of people brought to the cemetery for burial has almost fallen markedly.

 

"Two years ago I used to bury 30 bodies a day, now I bury one if I'm lucky and often I bury none."

 

The father of four is struggling to put food on the table for his young family. His children have been forced to drop out of school because he can't afford to pay their school fees. He is struggling to provide one meal a day.

 

After more than 20 years of continuous fighting, Somalis finally seem to be emerging from the dark days of their civil war.

 

"Somalis are tired of fighting. They know now, first hand, that fighting each other brings only two things: death and destruction. Somalis are the biggest driving force behind the return of peace in Mogadishu," says Abdullahi Mohamed Shirwa, chairman of the Mogadishu-based peace advocacy group Somali Peace Line.

 

Al-Shabab retreat

 

More than 17,000 African Union soldiers are now in the Horn of Africa country to support the weak government in their fight against the hardline rebel group al-Shabab.

 

Under increased military pressure, al-Shabab has retreated from major cities in south-central Somalia. This has moved the frontlines of the war away from populous cities and town, reducing deaths. "Mogadishu is no longer a frontline, and Bakara Market [the biggest market in Somalia] is no longer been shelled and fought over by al-Shabab, Somali government soldiers and African Union (AU) troops, so the number [of] deaths has decline greatly," said Shirwa.

 

At the height of the civil war, 14 gravediggers used to work seven days a week at Abdirashid Ali Sharmake cemetery, but currently only two remain, one of whom is Ali Hassan.

 

Fifty-one-year-old Mohamed Jama, a father of seven, is the other remaining gravedigger.

 

Jama dug his first grave in 1994 for $30, and never looked back.

 

He remembers the days, just over a year ago, when AU soldiers and al-Shabab were fighting in Bakara Market. "I sometimes use to make about $300 a day when they were fighting in the busy market. Many people were killed and were brought to this cemetery to be buried."

 

He recounts that business was even better before, when warlords constantly fought for turf, leaving countless people dead.

 

Even though Jama made the most amount of money during those years, he remembers that time as the worst in his career.

 

"Their militias would many times bring live people to the cemetery, then order us to dig graves before executing the people in the graves we just dug right in front of our eyes, telling us to bury them."

 

Those years continue to haunt Jama: "I don't like to dig a grave for a person standing next to me begging for mercy."

 

Some of his colleagues were killed when they refused to dig graves for militias. "Five of my friends were killed when they refused to dig grave for militias when they brought a live person."

 

Despite those challenges, his seven kids went to private schools and he had a maid helping his wife with housework. The family lived in a four-bedroom rented house, but have now moved from their rented house into a camp for internally displaced persons.

 

The pinch of peace

 

It's not only the gravediggers feeling the pinch of peace in Mogadishu. The dead bodies brought to Jama for burial are usually wrapped in a white piece of cloth.

 

According to Muslim customs, when someone dies they should be wrapped in a white piece of cloth called kaffan before being buried.

 

With the number of deaths in Mogadishu falling greatly, kaffan sellers in Hamar Weyne have also been left wondering how to make ends meet.

 

"Two years ago we use to sell at least 49 metres of kaffan a day. Now, we barely sell two metres," says kaffan seller Mohamed Abdi Khadir.

 

He's been forced to diversify his target market from selling kaffan for burials to selling it as a tablecloth to new top-end restaurants opening in Mogadishu.

 

"In Mogadishu, if you don't adapt with the changing currents, you will die."

 

Jama feels he is too old to change his career. He speaks clearly about what will put food on the table for his family: "For us, we are happy when there are bombs going off and fighting taking place. I have seven children and a wife to feed.

 

"If others don't die, they will die."

 

Follow Hamza on Twitter: @Hamza_Africa

 

Source: Al Jazeera

 

http://www.aljazeera.com/indepth/features/2013/01/201312791950249235.html

[Haatu]

Some people are just sick.

[OdaySomali]

$5bn economy is utter nonsense.

[Haatu]

They're just estimates. No one knows for certain but I wouldn't be surprised if it is higher.

[Homunculus]

Haatu;913500 wrote:

Somalia gravediggers grieve improved security

What a funny macabre article title. I thought it was an onion article not from al jazeera.