Meaningful Economic Growth in Somaliland Demands Private, Public & Professionals Partnership

Somaliland Chamber of Commerce announced back in November that the 8th Somaliland International Trade Fair would be held 9th to 15th December, 2018 at the Guleed Hotel in Hargeisa. The fair usually promotes the local production and trade in the country as well as the agriculture, industries, livestock and general services available in the country.

The speech of the Somaliland president – Hon Muse Bihi Abdi – at the Somaliland International Trade Show eloquently and deeply outlined the developmental priorities and how the local economy can be improved and presented it in a fashion never been done by any president this nation had so far. The president stressed the need to have a partnership among the Somaliland professionals, the business leaders, and the government in order to achieve a sustainable development.

                       Somaliland president Hon Muse Bihi Abdi

Somaliland is abundant of intellectuals and professionals who live in the country and in Diaspora as well. Intellectuals and the business communities are the mind that sets the vision guiding the country to the path of peace and prosperity. For instance, the United States – the largest economic power in the world – the policies for its development does not come alone from the politicians but parts of such policies are the recommendations and inputs of an expert institutions such as Think Tanks and politicians merely legislate and implement these policies after carefully scrutinizing them.

A vision that lacks funding and financing is just a dream. Therefore, it is incumbent upon the president to put in place the mechanism that allows the wealthy and business leaders to invest in the country to realize the economic goals of the nation. Once we put together the funding provided by the local businesses and the expert knowledge of Somaliland professionals but the confidence building influence of the political leadership is missing from the equation, nothing would be accomplished and we would get stuck with decaying economy and skyrocketing unemployment.

Therefore, if the President is really  determined and his remarks about the economic development are not only meant for public consumption but wants to grow the country’s economy, the Somaliland professionals as well as Somaliland business communities with resources are ready if  the president is willing to lead and work with them.

Achieving that goal of energizing the growth of the economy necessitates the establishment of “Somaliland Economic Development Board”. The board is supposed to be made up of two divisions; a group that is entrusted with preparing economic regulations and their oversight and another group that is responsible for choosing and implementing the economic projects.

Regulations and Oversight Division of the board needs to complete the current draft laws dealing with Insurance, Investment, Banking, Petroleum & Minerals, and Land Management that are before the parliament as of now. The Hon. President must realize if these laws are not adopted and put in place first, Somaliland goes nowhere. The first priority is to have these regulations compiled and completed and then pass them on to the House of Representatives as soon as possible to go through the legislating process of debating, discussing and finally approving them. If the House of Representatives chooses to obstruct the implementation of these rules, it must be disbanded and holding of the elections should be expedited to elect new representatives that are interested in the development of the country.

Projects Evaluation and Execution Division of the board should prepare projects critical for the economic growth including production of cheap power, launching of Berbera Cement Factory, and any other crucial projects for nation’s development. The first task of this division is to create the Somaliland Development Bank. The bank would normally conduct visibility studies on the proposed projects. Then, it would share the finalized and approved developmental projects with Somaliland people whether in the country or in the Diaspora as well as with the foreign investors willing to buy shares provided the ownership of any project remains in the hands of Somalilanders. Once the bank secures the desired investment for any project, the stakeholders would select a joint committee that works with the bank on each specific project ensuring the smooth running of the project.

Delivery of Cheap Light & Power

Fortunately, there is an association known as The Somaliland Electricity Association (SEA) that is the national body representing Electricity Service Providers throughout Somaliland. The electricity providers in the country use diesel generators that produce an expensive power and light. The other sources of power and light like the gas fueled plants, solar panels and wind turbines are not well developed in Somaliland and would not be a dependable alternatives because the natural gas as well as the batteries that store the harvested power from these sources are beyond our reach as they require a huge investment.

                                    Power Providers in Somaliland

The president and his administration has to devise a viable and affordable plan for the energy and power needs of the nation.  A megawatt (MW) is a unit for measuring power that is equivalent to one million watts. Somaliland needs probably 100MW – 600MW of energy in the form of power. So, that amount of power needed can be designed to come from several different sources implemented in a gradual systemic manner. The cheapest electricity can be produced from the coal. If it is not feasible to make use of the coal deposits claimed to be available in the country, it can be cheaply imported from African countries or from elsewhere in the world. Therefore, the solar power and the wind turbine power can complement the power generated by the coal, but they cannot alone be a reliable sources of power. The funding for this project comes from the Somaliland public as well as the business communities by the way buying shares.

Berbera Cement Factory

Somaliland has preferred to both buy cement from the neighboring countries and import some from the faraway countries as well, spending millions of dollars, rather than rebuilding the old Berbera Cement Factory. If we would have put that money in constructing the Berbera Cement Factory, it would have covered our demand for cement and at the same time created thousands of jobs for the locals

So, in 2010, the Berbera Cement Factory was handed over to a group of brokers with no money in their disposal. Again two years ago, the Berbera cement factory is transferred to the current group consisting of the earlier brokers and a new addition of a few businessmen.  The president should understand that this group cannot repair the cement factory because of the following reasons.

There are few companies specifically engaged in selling, setting up, servicing, and repairing such type of factories, and they can accurately tell the estimate of the cost needed to rebuild and the time-frame to be in operational.

Berbera Cement Factory

 First, they are not engineers who are going to rebuild it with help of their know-how, and second they are split into two camps: the brokers and the businessmen. They are not in agreement how much funding and financing the factory rebuilding requires. The businessmen camp just wants to play a waiting game frustrating the other camp and forcing them out with a small change. The broker camp also are playing their game of shopping for an international company willing to buy their interest for commission.

Our constitution does not allow the national resources to be in the hands of a group of people or in a company.  So, it is the interest of the nation to revoke the contract with the Berbera Cement Factory group and the president can take the same steps that he followed when he reclaimed the public land that was illegally sold in the Berbera vicinity.  

These brokers don’t represent the local residents in the vicinity of the cement factory and the revenue of the factory can be wisely and efficiently shared with area locals if some sort of authority is setup rather than dealing with individuals like Berbera Development Authority which would collect 5% – 10% from each sack of cement produced and reinvest that money in the area.

In conclusion, the speech of the president was what the concerned citizens of Somaliland like to hear from their leadership, and the public is actually monitoring if the president would follow through his speech. If that is not the case, it would become another sugar-coated empty talk.

Finally if the president acts upon the recommendations presented here or another sets that are similar to these, the country would slowly achieve the desired progress. The cohesion and the unity of the people of Somaliland flourishes when justice prevails but when the national resources are exclusively awarded to few crooks  and powerful businessmen we are not going to be different from Siyad Barre Regime that he and the Somaliland people ousted.

Omer Abdi Yussuf in collaboration with Ahmed J Yassin

Disclaimer: Views and opinions expressed here are those of the author/authors and do not reflect views of Somaliland Intellectuals Institute (SII) and/or its sponsors or partners. SII reserves the right to edit articles before publication. To consider publishing your opinion piece or analysis please email to December 20, 2018