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Lagos, April 23, 2003 (Vanguard): The economy of Somaliland, which last week held its first presidential elections since seceding from lawless Somalia 12 years ago, has been crippled not only by a lack of international recognition but also by a ban on livestock exports.
The self-declared republic that sits at the tip of the Horn of Africas depends on its main port, Berbera, and money from the diaspora to stay afloat, now that livestock exports to oil-rich Gulf States have been banned. The ban was imposed in 1998 and again in 2000 after Saudi nationals died of Rift Valley disease, believed to have been imported to the Arabian Peninsula from east Africa. Despite several inspections by local and international health organizations, the Saudis have insisted they will not allow animals from Somaliland and other regional governments into their country.
Taxes gathered in Berbera - used not only be Somalilanders but also as a transit point for goods going into and out of neighboring, landlocked Ethiopia - amounted to 13.125 million dollars (around 12 million euros) in 2002, according to documented statistics. The port brought in 81 percent of Somaliland's overall budget of 16.191 million dollars that year. Already on very shaky ground before the livestock ban, state revenues dropped by 40 percent afterwards, as the tax earned on each head of more than 3 million cattle a year was lost, according to Ali Omar Mohamed, the director of the port of Berbera, through which all Somaliland's import and export traffic transits.
"Today, more than one-third of the population depends on money sent monthly by people working in Europe, the United States and Arab countries," said Ahmed Yasin Abdullahi, owner of a small shop which rents and sells recorded music and pirated movie cassettes. The diaspora injects some 150 million dollars a year, according to official figures.
"If money was not sent to people by their loved ones abroad, life would long have been very miserable", he said. "Somaliland could also make more money from some exports of marine products, meat, hides and skins," said engineer Mohamed Hashi Elmi, a former mayor of the Somaliland capital, Hargeisa. But such exports are tiny and unregulated, and fierce competition has pushed prices down, Norway-based Somalilander Ahmed Ismail said. Unemployment is high, and the people's purchasing power minimal, although food is reasonably cheap. Somaliland, a former British protectorate, became independent on June 26, 1960, but days later united with the Italian colony in the south to form the republic of Somalia. It seceded from the rest of Somalia in May 1991, five months after late Somali strongman Mohamed Siad Barre was overthrown, but it has yet to be recognized by the outside world despite having developed the tools of statehood, including its own currency, penal code and flag.
Its first democratic elections, held on Monday last week, were won by a razor-thin margin by incumbent President Dahir Riyale Kahin and hailed by international observers as peaceful, orderly and transparent. Even Abdulkassim Salat Hassan, the president of the Transitional National Government (TNG), which only controls pockets of the Somali capital, Mogadishu, congratulated Somaliland on its peaceful election. Salat, who, like much of the international community, has not recognized Somaliland as an independent entity, said "Somalia's northern region" had made considerable progress in pacifying its fiefdom. In contrast to Somaliland, Somalia still has no central government and is wracked by clan warfare. The successful holding of elections in Somaliland could end more than a decade of isolation by the international community and open up the much needed funding for its fragile economy, observers have noted, possibly even allaying the effects of the livestock ban.
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