Somaliland Trade, Exports and Imports: An Overview

The self-declared Republic of Somaliland has accomplished a tangible economic and political reconstruction since its secession in 1991. This study aims to shed light on the international trade pattern of Somaliland and its export/import components. Livestock is the major export of Somaliland accompanied by its byproducts i.e. hides and skins while the country heavily depends on imports of food, fuel and manufactured products. Although livestock trade considerably contributes to the economy, it faces a number of challenges and losses due to the absence of financial system, dependency on single foreign market and multiple taxation. Saudi Arabia is the leading destination of Somaliland livestock exports followed by Yemen, UAE and Omen. On the contrary, imports originate from neighboring countries, Gulf countries, South East Asia and beyond. Livestock trade contributed to the livelihoods of the Somalis since time immemorial. However, the arrival of the British colony transformed the livestock trade and increased the demand as they aimed to supply fresh meat to their army in Aden. As a result, Berbera port became the trade hub and the major port of livestock exports in Somaliland British Protectorate. Livestock exports proliferated in the post-colonial Somalia, where the export

numbers peaked in 1970s (Samatar, Salisbury & Bascom 1988).

As our research interest lies in the postwar Somaliland, some of its livestock trade advancements and

challenges have been elucidated. Only male goats, sheep, camel and cattle are exported while the female livestock are consumed locally. Burao, Hargeisa and Wajale are the key local livestock markets. Due to the civil war of the late 1980s, livestock exports stopped but restarted in 1991 when relative peace has been achieved. It took only two years for the livestock exports to match that of the prewar, while they exceeded it in 1994 and reached a record level of over 2.5 million heads in 1997 (Academy for Peace and Development 2002). Nonetheless, that number decreased by 64 percent in the following year after Saudi Arabia banned importing Somali livestock due to the outbreak of Rift Valley Fever in Southern Somalia. That ban lasted until mid-1999 but there were livestock exports to Oman, UAE, Qatar, and Yemen during the ban. In 2000, Gulf countries issued a total ban of the Horn of African countries livestock as the Rift Valley Fever has been spotted in Saudi Arabia and Yemen. Obviously, these bans proved the vulnerability of Somaliland livestock economy and trade to external shocks (Academy for Peace and

Development 2002).

Somaliland livestock trade faced numerous challenges and great losses due to a number of reasons.

Apparently, the dependence of single foreign market – Gulf countries, mainly Saudi Arabia – makes the economy subject to as well as susceptible to all changes in that market. Local livestock suppliers and exporters sometimes face falling prices in foreign markets and constant per head costs in local markets which leads to a substantial loss. The absence of financial system, commercial banks in particular also results losses in livestock exports. Multiple taxes issued on livestock traders throughout the exporting process in Somaliland reduces the profitability of livestock trade and increases loses (Academy for Peace and Development 2002).

As the volume of international trade has been increasing over the years and resulted more interdependence among nations, Somaliland economy heavily depends on international trade. In 2012, export levies and import taxes contributed over 50 percent of the revenue. Furthermore, the economy is described as a very open economy according to the ratio of imports plus exports to GDP which is 91.5 percent, the 7th highest in Sub-Saharan Africa and 45th highest in the world. However, given the fact that country’s imports outweigh its exports, trade deficit is considerable, financed by remittances and aid contributions. Livestock is the major export of Somaliland accompanied by its byproducts i.e. hides and skins while the country heavily depends on imports of food, fuel and manufactured products. Berbera Port is the country’s main seaport providing both importing and exporting services. Somaliland exports primarily end up in Arabian Peninsula while its imports come from neighboring countries, Gulf countries, South East Asia and beyond. Furthermore, Somaliland livestock trade faces substantial losses due to multiple taxation, absence of financial system, the dependency of single foreign market and market price fluctuations.

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