Leading figures from the Somali business community have called for aid organisations to invest in business and infrastructure to combat problems gripping Somali territories.
This week Somali business officials, NGO representatives and experts on the region gathered in the House of Commons to discuss their role in fostering development within the Somali region. In response to the recent London conference on Somalia, the eleventh-hour assembly entitled Somalia: Business as usual? - hosted by the Royal African Society and introduced by Rt. Hon. Alun Michael MP - offered an alternative debate focusing on how Somalia's booming business, trade and investment activities can be used to help the region stage its own recovery from the many political problems that have plagued it for over twenty years.
Speaking at the assembly, Abdirashid Duale, the CEO of Somalia's largest private employer, Dahabshiil, said: "Somalia's future lies in its economy. The lifeblood of every Somali is trade, so the most important thing for the region is for enterprise to flourish. Despite the recent milestone conference on Somalia, the greatest challenges remain ahead.
"The international community should recognise what is working within the Somali community and harness that. Business growth can serve as a catalyst for political development and vice versa. Despite problems of security and instability, Somalis have already demonstrated ? through the successes of key sectors such as livestock, money transfer and, more recently, telecoms ? that Somali territories are fertile grounds for trade and commerce."
In regions where the political climate is stable, business confidence is strong. During the assembly meeting many commentators expressed the view that Somaliland?s growing economy can help to encourage political stability across the region by demonstrating economic viability. Business leaders called for practical solutions such as assistance with investment and job creation as a means to protect vulnerable Somalis, particularly younger generations.
The London conference brought together some of the world's most influential leaders - including the UN Secretary General and over 50 governments and international organisations ? to demonstrate commitment and coordination for a new international approach to tackle Somalia's problems. However, despite addressing a range of issues including terrorism, piracy, food shortage and the political vacuum affecting the region, the role of business and how the public sector can learn from the private sector was curiously overlooked.
Richard Dowden, Director of the Royal African Society and Chair of the assembly meeting, said: "Britain's current fixation with security and aid in Somalia has meant that business, trade and investment were omitted from the conference's agenda. In response to the conference and perhaps in some ways a reflection of these fears, it is imperative to stress Somalia's success in maintaining global connectivity linked to remittances and investment. We believe investment in business is the best way to fuel the country?s recovery and help restore stability.?
During the assembly meeting, business leaders concurred that livestock remains the mainstay of the Somali economy, while new sectors such as money transfer and mobile telecoms have experienced significant growth in recent times. Somalia accounts for 95% of all goat exports and 52% of all sheep exports within the Horn of Africa, while the country also has one of the cheapest and most efficient mobile phone networks in Africa. Moreover, Somalia has an abundance of natural resources with substantial reserves of oil and gas, including an oil reservoir believed to be the second largest in Africa.
Nevertheless, it is diaspora investment and expertise which have fuelled the growth of these new industries and facilitated trade in traditional sectors. Annual remittances sent to the Somali regions by the diaspora are estimated at around US$2bn, an essential capital flow far greater than that provided by international aid. Dahabshiil handles the majority of remittances to the region, while recent inward investment from Turkey has provided a further boost to the economy, most of it in the city of Mogadishu, which European investors have deemed too risky. However business leaders called for similar investment from Turkey into other Somali territories, including Somaliland and Puntland - and have encouraged the international community to follow suit.
In recognition of the important role played by the diaspora in fuelling economic growth, and its potential for enhancing the resilience of fragile communities, Dahabshiil is going to work with the International Fund for Agricultural Development (IFAD) to leverage the contributions of diaspora communities and encourage sustained economic development through investment in agriculture ? particularly in rural areas. The aim is to encourage social entrepreneurship and increase access to markets for diaspora members.
Mr Duale concluded: "The Somali territory needs investment in infrastructure and not just aid. The diaspora is in a unique position to deliver skills training, and foster development. Their resources, and willingness to invest in what many regard as fragile markets, coupled with the Somali peoples? local knowledge of the situation on the ground, would give the efforts of the international community increased legitimacy and greater purpose."
