26 May 2019

Somalia: Is Oil Exploration More of a Curse Than Blessing?

analysis

On 20thMay 2019, Somalia's Lower House passed a petroleum bill ahead of government's plan to issue oil exploration license by the end of this year. According to the plan, the winners of the bid will be announced on 7thNovember and the official agreement will be signed on December. The agreement will go into effect on 1stJanuary 2020. The bill was passed after getting vote of favor from 150 parliamentarians out of the 275 Lower House members, only 4 of them abstained. The rest were not in attendance.

As a concerned citizen about the fate of this nation, I would like to shed light upon some major issues regarding the offshore oil exploration in Somalia. My observation is based on both the local context specially focusing on Somalia's complicated and dynamic conflict while also looking at other similar situations in Africa.

Among the many stories that my grandfather told me as a kid, some of them were about tribal wars in many parts of Somalia. He would tell me how many people including the finest men, elders and chiefs, religious leaders were killed for revenge between the clans. As a child, this was all bigger than my head but that didn't stop me from asking what brought all this fighting and killing of innocent people and my grandfather would say "oh my son, it is all about greed over access to water, grazing areas and farmlands." It was all about fighting over control of resources.

Historically, Somali clans who are largely pastoralists have clashed for years over access to grazing, farmlands and water. This has resulted a cycle of conflicts among these clans that have become part of its history. In the lifestyle of rural areas, it is common for pastoralists to move from one place to another in search of water and pasture. There is popular Somali term used in the pastoralists circles known as "RoobRaac" loosely translated as Rain Follower where families move from area to another with their livestock. This movement often creates conflict among the clans as they compete for these resources. This endless conflicts among Somali clans still rage on in this twenty century, so who guarantees that oil exploration will not add a fuel to long burning fire?

Creating Domestic and International Conflict

Offshore Oil exploration in Somalia could be seen as great opportunity to boost the country's economy and that the revenues from this discovery will be used to enrich generations of Somali people who are largely unemployed. However, in my personal opinion I am not envisioning this delusional dream even though it would to be optimistic.

As much as the availability of these gifted natural resources in Somalia is blessing it is also a curse that is destined to incite further domestic conflict between clans and federal states and international conflict between global powers. The fact that petroleum law has been passed swiftly without much public consultation has already created confusion with some of the federal states claiming that they were not engaged in the process.

My concern is also how the income and revenues generated from the oil business will be managed knowing that Somalia is currently sitting at the bottommost of Transparency International Corruption Index. Besides, I don't think other oil producing countries primarily Saudi Arabia, Qatar and UAE whose current diplomatic relations with Somalia is even in question will just sit there watching us while we grow and thrive economically.

Natural resources caused Bloody wars in Africa

History teach us that natural resources have played negative role in some of Africa's bloodiest wars, if you look at the cases of Nigeria, Sierra Leone, Angola, South Sudan and the Democratic Republic of the Congo (DRC) you find that all these countries are blessed with natural resources yet their people are still suffering from endless poverty or repeated wars.

For years, Nigeria's oil-rich southern delta region has been a battlefield of constant armed conflict between the local communities, armed groups, the military and police. The fighting has claimed many lives and disrupted the country's main export sector. In a report released by UNDP in 2006 noted that the area's "vast oil wealth has barely or ever touched people's lives,". It is also worth to note that due to its widespread corruption and lack of capacity to refine their crude oil, Nigerian citizens often times face fuel crisis and are seen making long lines to fill their cars.

The main cause Sierra Leone's decade-long civil war was over control of that country's diamond fields. You might remember this if you have watched the famous Hollywood movie "Blood Dimond" starred by Leonardo Di Caprio. In Angola's war, the government controlled and benefited greatly from the offshore oil fields, while the rebel movement managed and sustained itself for years through illegal diamond mining. Today, Angola is the second largest oil producing country in Africa, both oil and diamond extraction generate a lot of revenue but unfortunately much of the wealth stays with large companies and elite individuals such as politicians.

Reconciliation before anything else

With that said, I strongly believe that Somalia, a country that is already suffering from three decades of conflict is incapable of dealing with complex geopolitical interests and conflicts mainly driven by competition over controlling valuable oil and natural gas resources.

Somalia is in post conflict state and from other similar experiences when nations are emerging from civil war there are number of issues that have to be prioritized before that country opens its natural resources for foreign investments. The first one is an internal reconciliation which is paramount to achieve a lasting peace in a divided society like Somalia. Setting up Truth and Reconciliation Commission to heal the past wounds should be priority before taking any other step. This approach has been successful in countries like South Africa, Rwanda and Sri Lanka.

There are victims who faced serious human rights violations through the period of civil war and during the 20 years of tyrannical regime in Somalia who are still grieving until today. These people were subjected to various forms of abuses and atrocities including mass killings, rape, torture and destruction or looting of their properties.

Sharing natural resources among federal states and the federal government have not been officially agreed. As matter of fact, in 6 days long conference held in Garowe between FMS and FGS ended with no promising results which has increased their division.

Somali Can Flourish Peacefully without Oil Exploration

Before the civil war, Somalia was among one of the fastest economic growing countries in the continent in terms of agriculture and livestock production. Today, despite the insecurity and political instability, agriculture still plays major important roles and remains as the largest economic sector in the country as it contributes to more than 65% of the national GDP. Livestock production alone contributes to 40% of the GDP and more than 50% of export earnings.

All Somalia needs today is just political stability and security, perhaps the current administration should prioritize only this two issues instead of oil exploration. Invite both domestic and foreign investment on the three sectors considered to be Somalia's main sources of economy which are the livestock, farming and the fishing industries. These three sectors alone will have Somalia flourishing itself. Also we need to focus on renewable energy and reduce electricity costs so that people can easily invest in these businesses.

There is a long way to go before Somalia thinks about joining oil producing market, let's start first establishing peace within ourselves and the world. let's focus on the other natural resources we have which can boost our economy without getting ourselves into another bloody war. This whole offshore saga is just serving the interests of few elite politicians who will be the main profiteers of this lucrative business while our poor community will remain poorer.

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