It is Time to stop the short selling of Somali ports and public assets

[galbeedi]

Did you hear about a man burning a mango tree for a charcoal to make few bucks?. Rather than nurture the tree and gain some food for life, he is "raising against time" in order to cash for few dollars that will buy him a lunch or worse, for a bundle of Qat. The same thing could be said about Somali regional governments wholesaling port assets for paltry of few million dollars.

 

In Somaliland, the deal that was rushed by the government to pocket few millions for the second largest port in Somalia, might have already reached it's end between the DPW and the Hargeisa government.

 

According international analysts, The controversial UAE firm’s $442 million investment deal which would see the company owned 65% of Joint Venture with Somaliland Government stipulated that DP World takes the task of renovating and overhauling the port, something that the company has so far failed to do.

 

Instead the company opted to maintain the company’s original structure, and despite producing over $10 million in revenue from the port per month, has not taken any efforts to modernize or add capacity.

 

 

Under the deal, DP World was also supposed to support the port with modern equipment and start the expansion of the port’s capacity with the construction of a 400 meter square area, a responsibility the Emirati firm also failed to fulfill.

 

The breach in the port’s contract by the firm will likely ran into immediate opposition in the region, with significant parts of the local population opposed both the port and military base deals with the UAE. The biggest advantage of the deal was the plan to pave the 280 km Berbera-Wajaale highway to expedite transit freight to Ethiopia, yet , it seems that part of the deal is scrapped from the next faces of the project.

 

In business, when you sell stakes in your company or assets, usually you exchange cash, shares and investment to enhance the growth and the cash follow for yourself and the investors . .When I saw the minister of foreign affairs of Somaliland announce a cash advance of $15 million dollars as signing bonus, which is called (Xaqul qalim in Hageisa), I knew there was something fishy about this deal. How could a government exchanging a billion dollar asset for few millions of dollars before the conclusion of the deal. Why would you bribe yourself and make your negotiating position weak.

 

So far, Dubai world port has done nothing other than to layoff 25% of the work force and collect millions from the local economy.

 

Inflation is skyrocketing and the only answer to the problem is the constant printing of the Somaliland Shilling.Rather than decrease liquid money in the market and improve exports for hard currency, they are flooding the market with printed papers as legal tender money and made the condition worse.

 

Wax baso wax beel bay leedahay.

 

Just 800km to the north east in Boosaaso, another similar deal is cooked by president C/weli Gaas. Just like Berbera, the Gulf company has promised to invest multi purpose facility with $336 million dollars divided in two faces. Also, just like their cousins in Hargeisa, they got $15 million dollar cash. According to Faisal Rooble, a Somali political analyst and activist , Mr. Gaas has allegedly pocketed the money for his own corrupt practices.

 

Furthermore, just like Somaliland , he started printing illegal money to cover the unpaid salaries of civil servants and teachers. According to Garoowe online, a local news site: "Traders in administrative capital of Somalia's northeastern semi-autonomous region of Puntland, have shut down their business premises on Wednesday, Garowe Online reports.

 

"The closure of city’s main businesses has sparked after an order from the local government, instructing the traders to use a counterfeit Somali Shilling banknotes printed by the current Puntland administration".

 

"Some of the traders, who spoke to Garowe Online on condition of anonymity, said they have decided to close-down their businesses, because they are losing money to false currency, which the government is forcing them to use it at gunpoint".

 

For years, the Somali leaders used to pocket money from NGO's and aid money for their own enrichment and for their political interest, and that was tolerated by the public for one reason or another. The problem is now thay are whole selling national assets and the future economic growth of the country for few bucks.

 

Compare how other nations and regions had approached and managed foreign investment of their ports and countries . Here are few examples:

 

Sri Lanka has signed a $1.1bn dollar deal with China for the control and development of the southern deep-sea port of Hambantota.

 

The deal had been delayed by several months over concerns that the port could be used by the Chinese military.

 

The government has given assurances that China will run only commercial operations from the port, on the main shipping route between Asia and Europe. Sri Lanka's government says money from the deal will help repay foreign loans.

Sri Lanka says the deal will help it to get out of the debt trap. It borrowed billions of dollars from China to build roads, ports and airports to revive the economy after the end of the civil war in 2009.

 

As you could see over a billion is paid for 70% stake to operate the port.

 

In Pakistan, the Chinese government is investing $46 billion dollars in what is called China Pakistan Economic Corridor or CPEC, for rail, electric and port development.

 

In any multilateral trade or investment negotiations, usually it is technocrats and experts who negotiate the nitty and gritty details before the leaders sign the final agreement. Here , in both Puntland and Somaliland what we have is leaders sending their family members to negotiate on their behalf and pocketing cash before the the final deal is reached, which could only be characterized as bribing your opponent to accept your agreement.

 

Politicians taking kickbacks is not a new thing, but to exchange of the future of your people for few bucks is not only greedy but immoral.

 

Federalism and delegation of power meant to delegate service and state institutions for the benefit of the locals, yet what we got in Somalia is a license to loot and serve the interest of the foreign powers. Somaliland has 68 ministers and probably another 50 or so who were fired without cause are still drawing a salary.

 

No to be outdone by Somaliland, the man in Garoowe, C/weli Gaas, in August 2017, appointed 53 ministers after he manipulated the parliament to fire his own ministers. With yearly budget of less than $30 millions, the Puntland elite are hiring themselves as ministers , vice ministers and state ministers. I guess every sub clan must be happy after they have been bribed by their own money. Rather have a water well or hospital, they will have couple of ministers (beeshu wixii ay rabtay ayuu sameeyey). The lazy elite, rather than create jobs , and build infrastructure for the public are creating cushy do nothing jobs for themselves. How else would you describe a 53 minister cabinet in $30 million dollar budget.

 

Some well meaning people might argue that in order to rule and build things , leaders must satisfy the and play by the corrupt cultural practices of the elders and locals. I disagree. Since it is given that a typical Somali leader would rule four or five years, why not leave a legacy of institution building and good governance. If they throw you out for doing the right thing, that would be considered a success among the people.

 

Farmaajo was welcomed because during his premiership he tried to pay the army on time and allegedly stood up against Uganda, which could true or not.