Somaliland Budget 2006: The Blind ‎Leading The Blind‎

By Abdillahi Hussein Daud

As of today, Somaliland is a nation living on assistance. However, this is not what worries me the most. The larger problem is that the county does not have a plan to get out of this trap. Moreover, national leaders of both the ruling as well as the opposition parties have no vision whatsoever to lead the country out of economic dependency. A case in point is 2006 budget. By and large, a national budget should not only contain sources of taxation and its allocations but must also lay the ground for short and long-term economic developments. The Somaliland budget 2006 lacks that important ingredient since it does not address the extremely important issue pertaining to complete takeover of the county’s economic planning apparatus by the UN and foreign Non-Governmental Organizations. In our government, The Ministry of National Planning has the mandate to formulate national economic development plans. Nevertheless, the minister in-charge is more busy with ‘who gets hired’ by the NGOs. This is a criminal abdication of national responsibility. But the legislative branch, especially the newly elected House of Representatives, has also miserably failed to exercise its constitutional oversight of keeping the government in check.

The Government’s Failure

At the inauguration of a new livestock centers in Hargeysa last week, President Rayale thanked his Minister of Livestock for securing center’s building expenses from foreign NGOs. The President even asked other ministers in his government to follow suit and seek handouts from foreign NGOs. This is an insult on Somaliland’s pride, if any. Evidently, it seems, ministers in Rayale government are just doing what their leader is telling them to do. Here comes then the indecent episode about the Minister of National Planning, Ahmed H. Dahir vis-à-vis Amina-Weris. The minister is busy and obsessed with foreign NGOs. As the case of Amina Weris has vividly shown, the minister has plenty of time to closely monitor the hiring process of foreign NGOs but does not have any time to plan the nation’s economic developments. This is not the first case of its kind, though. The same minister was in collusion course with European Union officials few months ago over its refusal to hire his cronies. Therefore, many observers now question the credentials both academic and otherwise of this minister. If this is case of our government then what is the way out? In a democracy system, it is the duty of the legislative branch to step-in and provide its own economic policy agendas through the national budget and other legislations.

The Legislative Branch’s Negligence

The hastily approval of the budget this year by the House of Representatives dashed the hopes of many citizens who had great expectations from the newly elected body. If the government were a blind, the legislative branch demonstrated over its conduct on the budget that it is too a blind leading a blind. The House simply added some Shillings on the spending proposals but left the rest of the budget intact. What prevented this body from writing its own budget proposals and then reconciling it with the government’s version? Is it ‘we have not done this before’ mentality or law does not permit legislators to exercise this authority? Even if there is no provision in the law that authorizes the legislators to put forward a particular budget proposal, the House of Representative could legislate new laws. After all, the opposition parties have clear majority in the House. The people have given them the mandate to bring about drastic changes in their government’s modus operandi. What else are they waiting for? The House of Representatives have too abdicated its constitutional responsibility of consent and dissent.

The Missed Opportunity: Empowering the Business Community

Although beyond the scope of this article, the budget 2006 could have put in place supply-side economic policies that empower business community to create jobs and revitalize communities around the country. Some of these policies include, but may not limited to, the followings: First, the government needs to overhaul its taxation system, which put an unbearable burden on business community. Second, government must cut the red tape for entrepreneurs   willing to establish new businesses in the country. For instance, there should only be one-stop service office for business related transactions. Put it differently, there must not be countless requirements from different ministries and local government agencies for starting a business in Somaliland. Third, the government must create a conducive-environment for establishment of manufacturing industries in the country. For example, anyone establishing a manufacturing facility that employs ten people or more should enjoy a tax break for about five years. Fourth, the country must implement protectionism economic policies in order to protect and nourish its infant industries. For instance, the government should levy heavy import duty on any product that is locally produced or its close substitutes. The last but not the least, the government must facilitate the establishment of stock market, which will enable entrepreneurs to get access to badly needed funds from investors.

The author is a graduate student of Information Management at College of Management, Metropolitan State University, Minnesota. Earlier, he obtained a Bachelor’s degree in Economics and a Master’s in Business Administration. He could be reached at:  daudab@metrostate.edu

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