Somaliland: Resuscitating Economy In The Midst Of Current Pandemic

0
133
Exteriors and interiors of the Bank of Somaliland in Hargeisa, the central bank in Somaliland (BBC News Rushes - 25/12/2019 - AEXZ288W)

Somalilandsun: Somaliland will remain POOR and HOPELESS unless it adopts innovative and aggressive policies towards Free Trade and openness for Tourism, Foreign Investments,  and Oil & Gas Explorations

Somaliland has succeeded in setting up of working and vibrant democratic institutions for governance in a turbulent region that is largely run by autocrats and dictatorships.

However, because of poor economic planning and lack of innovative thinking, the country is facing dire economic conditions, crippling poverty rates, and widespread joblessness. The situation is exacerbated by the outbreak of COVID-19 which caused global shutdowns that resulted in a sharp decline in the the Somaliland Diaspora remittances as well as the international aid and investments.

In the short run, Somaliland urgently needs to adopt more aggressive and innovative strategies in its economic planning just to stay floating and surviving in the current global challenges. This is the reality before her since Somaliland is not an internationally recognized state and has no access to funding from global financial institutions like World Bank, International Monetary Fund, African Development Bank, and Islamic Development Bank.

Precisely, Somaliland government must quickly intervene by seriously adopting drastic strategies and revolutionary overhauling in the following sectors to build a viable economy, reduce the crippling poverty rates, and create jobs for the youth:

Free Trade & Regional Wholesale Distribution Zone

Somaliland should establish Free Trade Zone and and Regional Re-trade Center. Berbera, Zayla, and Maydh are prime spots for free ports and free trade zones. This strategic policy calls for drastically reducing import customs duties that currently generates almost about 150 million dollars a year. In compensating the lost revenue, another forms of direct taxations can be introduced such as value added tax (VAT) and Income Tax to finance government business.  As used in the rest of the World, customs tariffs should be a tool aimed at protecting Made-In-Somaliland products and local agricultural produces, and should not make such source as the core government revenue generator, because high import tariffs are obstacles to re-trading capabilities and volume local trading.

Stimulating Arts, Culture, Tourism & Entertainment Businesses

Tourism is becoming a global revenue generator and a major job creator for countries around the world. Somaliland should open its doors for entertainment icons like Beaches, 5 Star Hotels, Cinemas, and theatres. Currently in Somaliland, this sector is dead and needs to be inject with life. Ironically some cabinet ministers believe singing would take you to the Hell. In order to make Berbera Corridor a Horn of African success story we should adopt a new mindset.

Also by the same author Somaliland should Chose on Wealth Sharing in Public Property & Natural Resources projects

Optimizing for Direct Foreign Investment

The capacity to attract international investors requires long-term strategy which should be adequately communicated and shared with all stakeholders. Somaliland should enact the relevant laws and standard procedures and communicate those with the world community and locals in a transparent manner. In addition, Key Performance Indices and Indicators need to be set to monitor the progress and the drawbacks by finding out if such policies are delivering the intended results.

 Aggressive Auctioning of Oil, Gas and Mineral Exploration Rights

Oil, Gas, and Mineral explorations could be the best source for financing the socio-economic advancement of Somaliland people.  The government ought to adopt aggressive policies oriented towards achieving and accomplishing tangible results and terminate contracts of companies that are dragging their feet and achieving nothing. Somaliland administration should not be too soft on the exploration contractors doing nothing and sitting idle.

The current Ministry of Natural Resources has completely failed in this front.  The few ongoing oil explorations have ceased to operate and nothing seems to be in the pipeline at this time. The  ministry leadership should come forward and explain to the nation what is happening with this national priority and  portfolio

Sadly, Somaliland government is  failing on all the fronts mentioned earlier:

  • No vision and strategies for Tourism and Entertainment.
  • No strategy and planning for Regional Redistribution Center
  • Total disregard for attracting and catering international and local investors
  • No strategy for oil, gas, and mineral explorations.
Hassan Abdi Yousuf

By: Hassan Abdi Yousuf, Geopolitical Analyst Hargeisa, Somaliland for Somaliland Intellectuals Institute

 

LEAVE A REPLY

Please enter your comment!
Please enter your name here