Somaliland: The Privatization Of The Berbera Fuel Complex


By: Ahmed Kheyre

Somalilandsun – After the furore of the presidential and parliamentary elections had been extinguished by the Somaliland Constitutional Court and the subsequent decree issued recently by President Ahmed Mohamed Mohamud “Silaanyo”, the attention in the country has turned to the controversy of the privatization of the Fuel Complex in Berbera.

The President, a ” free marketer”, if there ever was one, is keen to privatize the complex. There are several local and international companies competing for the contract to manage the complex, a vital source of income for Somaliland’s treasury and a important component of the industrial sector in the country. The facility is in need of refurbishment and modernization, and although some small steps have been taken recently in that direction, including the strengthening of the security and research components, it still needs a lot of work.

The Somaliland House of Representative has rejected a bill supported by the administration to privatize the complex. The first time, in a long time, that House has shown that it is not a rubber stamp for the current administration.

Their argument for rejecting the bill is mainly that the Berbera Fuel Complex is a national asset, much like the Port of Berbera, Egal International Airport, the Somaliland National Television and Radio, and many other state corporations. The bill has since been sent back the House of by the President, and after much arm twisting from the presidency, it is expected to pass.

The House’s argument is that these national institutions must be remain in the hands of the public and not the private sector. Or at least, that the Somaliland government must retain a majority share in any future privatizations of such corporations. A very sensible and laudable position.

On the other hand, the administration of President Ahmed Mohamed Mohamud “Silaanyo” appears to the favour the Thatcher model, advocated by the late British Prime Minister, Margaret Thatcher, that the state must get out of the way of private enterprise.

Both positions have their merits and demerits. State control often leads to inefficiency and bureaucracy, whilst private management can be described as ruthless and profit orientated. Somaliland, is too poor and under developed to entertain such arguments.

Nevertheless, privatizing state agencies has been done before under both the late Mohamed Ibrahim Haji Egal’s administration and that of his successor, Dahir Rayale Kahin.

However, privatizations without proper accountability is the road to ruin.

For far too long, I have advocated for the strengthening of a National Audit Office and a proper Revenue Agency. Somaliland has unlimited human talent, we have so many graduates and professionals in this field, that it is inconceivable that we cannot commission a decent tax revenue agency and a strong auditing department. If we had such departments in place, then we would not have to worry about the privatizations of state corporations and the fear of corruption and personal gain.

But, sadly, we don’t, and this administration is not interested in getting this done. You see, it is much easier to enrich oneself when there is no scrutiny, accountability or judicial retribution. Shades of the defunct union with Somalia.

But, as with all problems, there is a silver lining. Any contract entered into by a Somaliland administration is subject to review by the next administration. We have the courts in place, we have a new Chief Justice who hopes to bring a modernizing element to the country’s legal processes, and most of all, we have a new generation eager to assume the mantle of leadership, and the elections are only a year and a half away. Insha’Allah.

So, let us not driver ourselves up the wall. Let the parliament and the administration debate the matter and reach a decision. Let the matter be settled without resorting to violence, community divisions and social disintegration. Keep your powder dry, and vote for change in 2017.

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