This chapter explores other studies that have been carried out in the research topic. The key areas covered are the reviews of the effects of Al-Shabaab activities in Somalia, the Somali Government policies and regulations and the ways they have impacted its people and how the US Government is supporting the Somali administration on political and security transition.
2.2 Al-Shabaab Activities and their effects on Somalia
Al-Shabaab is a group of terrorists whose activities have affected not only the economy of Somalia but also the economy of other neighboring Eastern African nations (Marchal, 2009). The terror threat has been an economic setback to Somalia because of several reasons. To begin with, terrorism in Somalia has led to the Somali Nationals migrating to the neighboring countries of Kenya, Uganda, and Ethiopia (Marchal, 2009). It is because the people have the feeling that it is not secure to stay in Somalia where there is no peace and terror attacks are the order of the day. To that end, the country cannot grow economically because it has been deprived of labor which is essential in the completion of the projects that lead to the development of the economy.
Moreover, the issue of insecurity in Somali due to the Al-Shabaab activities has made other nations around the globe to be wary of the threat posed by the terrorists (Marchal, 2009). To that end, the majority of the countries around the world have urged their nationals not to visit Somalia. Therefore, tourism which is one of the economic activities that has led to the growth of the GDP of Somalia has been enormously affected (Marchal, 2009). This effect has also been transferred to the neighboring Eastern Africa countries. The recent attacks of the Westgate in Kenya culminated in a decrease in the number of foreign visitors who have been visiting the country over the years (Marchal, 2009).
Similarly, the insecurity in Somalia that is caused by the Al-Shabaab has led to several attacks including bombings that have taken place in some parts of the country (Marchal, 2009). To this effect, many foreign investments have been affected. Potential investors have also been blown away by the terror threat. This condition has changed the growth of the economy of Somalia negatively (Marchal, 2009).
2.3 Somali Government policies and regulations and the ways they have impacted the people-Al-Shabaab Activities and their effects on Somalia
The Somali government has laws that have led to the administration not having the ability to participate in the provision of certificates to schemes with the objective of enabling them to trade their goods in the entire world(Parrin, 2014). This scenario has compelled the traders to find unconventional routes to the international market. These ways are costly. For instance, in spite of Somali being the 12th largest producer of sesame seeds, farmers have found it difficult to export them(Parrin, 2014). To make it worse, the Somali government has failed its people in that it has not involved itself in the trade barriers that have led to the challenge of exporting the products that have been produced in the country. The lack of the regulatory frameworks has led to the slow economic growth that is witnessed in Somali.
Another policy by the Somalia Government that has impacted its people negatively is the reality that there is a law that forbids the country from being a member of any trading bloc(Parrin, 2014). This situation has led to the several economic challenges that Somalia is facing. Besides, the nation does not have any trade treaties with other countries around the globe. This situation has made the Somalia not to have the capacity to compete in the international markets(Parrin, 2014). Besides, the nation’s economy has been affected negatively because the country cannot enjoy the benefits enjoyed by those countries which belong to a significant trading bloc. For instance, Somalia has a very poor infrastructure which has led to detrimental effects. There are only a few nations that are involved in trading activities with Somalia. For instance, United Arab Emirates and Yemen
Similarly, the inability of the country to implement the rule of law has affected the people of Somalia negatively(Parrin, 2014). For instance, reports are circulating that there are high cases of fake currency. Fake currency is not healthy to the nation because it may result in inflation that would lead to slow economic growth and development.
Equally, lack of government regulation has affected the people of Somalia negatively because it has changed the mining of the oil in the country (Parrin, 2014). To make it worse, some regional administrations have entered into treaties with other countries without the involvement of the government. This scenario has impacted the people of Somalia negatively because they end up obtaining oil and gas at very high prices. This situation raises the cost of living which is not good for a country whose ambition is to see its economy grow at an alarming rate.
2.4ways in which the US Government is supporting the Somali administration on economic, political and security transition-Al-Shabaab Activities and their effects on Somalia
With the objective of eliminating the effects of the drought that affected Somalia in the year 2006, the US Government provided Somalia with financial aid (Porter, Eizenstart and Weinstein, 2005). Over the years, the nation has been receiving more funding from the US. The majority of this money is meant to strengthen the economy of the country as well as the political structures with the aim of ensuring that the country is stable. The US subscribed to the idea that Somalia would use the money to ensure that her citizens could have access to social services as well as promote the existence of a credible government.
Similarly, the US has been supporting the Somali administration through ensuring that the country is involved in bilateral trade relations with Somalia (Porter, Eizenstart and Weinstein, 2005). For instance, America imports precious stones from Somalia while Somalia receives grains and legumes from the US.
Marchal, R. (2009).A tentative Assessment of the Somali Harakat Al-Shabaab.
Parrin, A. (2014). Five challenges for Somalia’s economic reconstruction. IRIN. Retrieved 22 November 2017, from http://www.irinnews.org/report/99647/five-challenges-somalia’s-economic-reconstruction
Porter, J., Eizenstart, S., & Weinstein, J. (2005).Rebuilding the Weak States.