SOMALIA: CASE OF THE GLASS BEING HALF FULL

 

Lieutenant General Katumba Wamala was last week in Somalia in one of his frequent visits to war torn Somalia.

Uganda contributes almost 20,000 troops to the Africa Union Mission in Somalia (AMISOM), the five-year regional peacekeeping effort to support the transition of the continent’s eastern most country.

During the duration of the mission a semblance of stability has returned to a country, which imploded after the overthrow of Siad Barre in 1991, torn apart by feuding clans jostling for supremacy.

The war against terror and recent threats to the safety of the maritime routes off the horn of Africa has made the continued existence of Somalia as a failed state untenable.

Enter Uganda and Burundi who provided the initial forces for the mission. The mission’s   objective among other things is to support the transitional government, implement a national security plan, to assist in creating a secure environment for the delivery of humanitarian aid.

Somalia is far from attaining a sustainable peace, but the green shoots of peace can be discerned.

"A sustainable peace will come when a critical mass of the society have individual and collective interest in acting within the law. That is when they have something to lose and breaking the law would risk igniting a downward spiral into anarchy and hopelessness...

Arguably the easy part of pacifying part of the country has been done the tricky part is to generate economic growth and then distribute this growth to create the bedrock of future stability.

Lt Gen Wamala is making the right noises. He suggested last week that a Marshall Plan for Somalia is necessary for it to resuscitate itself.

The Marshall Plan was a US sponsored financial plan to get Europe back on its feet in order to fend off communism.

Over the last two decades Somalia has literally bombed itself back into the stone age. The infrastructure and human resource have been so severely damaged and their development stunted by years of fighting that they are unable to marshall the resources internally to get themselves going again.

They have one big trump card, I think. The Somali diaspora is not only strewn all over the world, but has maintained close ties and developed into entrepreneurs of some repute wherever they are.

Entrepreneurs and not governments are what grow wealth. And if they are local entrepreneurs they are much more willing to take risks that foreign capital would not, creating confidence in the economy for the time when others will join the party.

Sluggish progress is being made towards building the foundations of government. Governments facilitate business development by providing public goods like security, social services and an overall enabling policy environment. This is important because without these a Marshall Plan for Somalia will not have the desired effect, will in fact be like throwing money down a black hole.

Just as AMISOM has shown that regional initiatives can provide solutions to regional problems, it’s probably time to show too that regional capital can play an instrumental role in lifting the economy of Somalia.

Nineteenth century financier Baron Rothschild once said, “The best time to buy is when there is blood in the streets” Investing in Somalia in the next five to ten years – assuming the current trajectory towards stability is maintained, will be like getting in on the ground floor.

By the time of the second world war the US had already taken its place at the high table of the world economy. Its pivotal role as the arsenal of the free world and the ensuing economic benefits that came with being at the center of reconstructing Europe is what cemented its place as the dominant economy of the second half of the last century.

"And just because the continent is helping Somalia stabilize does not mean we shall have first pickings of the opportunities available....

With Europe’s economy in the doldrums and the US recovery still making hesitant progress, capital is looking to Africa for investment returns.

The high risk situation that is Somalia is not a first choice investment destination but look out for western nations to jump in to provide the concessionary money that will build the communications and energy infrastructure, revive social services and bankroll the creation of the government bureaucracy as a fore runner to the entrance of private money.

Africa has the institutional set up to jump into the fray, what maybe in doubt is whether we have the political vision to see the benefits of such an investment.

East Africa will be the biggest beneficiary of a stable, economically vibrant Somalia. Not only will it cease to be a security threat to the region but will add at least another ten million people to the region’s market.

Africa has invested blood and sweat in Somlia but it need not stop there.