The proposal for unlocking financial opportunities is a model that aims to give solutions from research on what could be a breakthrough for Somalia’s development strategy. However, there is a noted possibility that it may not be as easy as it appears on writing. Somalia is a very complex country owing to the fact that it has been unstable since 1991 and continues to be a hot bed for terrorism. The presentation is targeted to multilateral banks, philanthropies, the private sector as well as the Somali government. It is just a proposed model that can be worked on at a later date.

1. Artifact by Linda Wambui Ndung’u

2.  Somalia is a war-torn country at the North African horn. It
has no centralized government which means there is no
coordination of resources especially based on clanism.
 It has a population of about 10.1 million and 37% live in
the urban area, Mogadishu.
 The country is endowed with natural resources such as
natural gas, copper, uranium, unexploited iron ore and tin.
 Poverty and hunger levels are high and the most affected
are women and children who are always on the move. 35%
of the children under 5 years are malnourished.

3.  Misuse of funds- There is no
centralized government hence no
legitimized rule of law.
Resources are amassed for
individual growth. Funds
deployed to this country
therefore rarely benefit the
citizens hence creating under-
development.
 Extreem poverty. Women and
children are dying every single
day due to hunger.
 Environmental degradation.
Everywhere there is conflict the
environment is destroyed. The
Italian banana plantations that
existed have all been destroyed

4.  Attracting new investors-
Investors are rarely drawn
to conflict areas because of
the risks. Therefore, there is
under-development and the
country loses out on
Foreign Direct Investment.
 Lack of collaborative
financing.- Somalia should
be able to mobilize its own
resources to top up on the
amount of Official
Development Aid given if it
is to achieve the Sustainable
Development Goals .

5.  Conflict-Development and conflict can never go
hand in hand and this is the reason why Somalia is
still lagging behind.
 Diseases-cholera, tuberculosis, malaria, Rift valley
fever among others are prevalent claiming lives.
 Illiteracy-The rates are high owing to minimal
schools and even the ones present have minimal
attendance.
 Underdeveloped export sector- The country’s
exports include bananas, sorghum, corn, fish, as
well as sugar.

6.  There has been increased focused on the region by
governments, official aid providers and the private
sector.
 Somalia just like any other country has potential. Its
geographical location makes it very important for
regional security. Its proximity to the deep seas
provides a path way for travelers as well as fish.
 Responsibility to protect(R2P), besides country’s
personal interests drives the need to end conflict and
develop the country. This is because there always are
spill-over effects that can be felt in so many countries.

7.  The idea that if you have more you should give to those
who don’t have drives the givers of Foreign Aid in this
region. The country has been struck by extreem poverty
and thousands are dying. Somalia is lagging behind.
 It is the right of the Somali government to provide for its
people. Their main task is the welfare of citizens as well as
upholding the rule of law
 Private companies are important in unlocking the
opportunities in Somalia. Their investment will forster
growth. As much as they are attracted to risks, conflicts
howerver, especially in an area that habours terrorism
militants, Al Shabab becomes a problem.

8.  Lack of a centralised Government. Somalia is
divided into Somalia, Puntland and Somaliland
which all run their activities separate of each other.
Taxation of the citizens also become difficult and
the government loses out on this channel of
financing.
 Lack of infrastructure. The country has been torn
apart and the little infrastructure that was there
has been destroyed over time. It would therefore
take much innovation to get funding for
infrastructure to get Somalia to where most
countries are.

9.  Extreme poverty and illiteracy. For foreign
companies to operate in a host country, they have
to give a few employment slots to the host
country. Majority of those living in Somalia are not
educated and are already struggling to survive.
 Instability. The Al shabaab terrorist group has
affected security in the region. They continuously
pose a threat to development and financing in the
region.
 Epidemic diseases continue to claim human
capital. Transmittable diseases will deter the
donors from coming to Somalia and instead
operating from their countries. With no one on the
ground to ensure the money is used well the funds
will be embezzled.

10.  The regions of Puntland and Somaliland are
autonomies and agreed to join Somalia once again
when there is better representation. This has taken a
while and might continue to do so.
Therefore, the best proposed solution would be to try
and develop Somalia. When the autonomies see
growth and peace they might decide to join Somalia
once again hence creation of a central government. This
is very key for efficiency in public expenditures and
accountability.

11.  Domestic resource mobilization is very key. It is
however challenged by the poverty rates and lack of a
proper functioning government to regulate taxes.
Therefore, amidst these challenges, a strategy to
strengthen DRM including a stronger administration,
simpler revenue systems, and collective action should
be in place to address international tax issues and illicit
financial flows.
 If these are not put in place there will be a large
informal sector and use of tax loopholes by
multinational companies once they come in.
 The Tax Administration Diagnostic Assessment Tool
(TADAT) initiative may be important to Asses the tax
structure of the country.

12.  There is a huge number of Somali diaspora all over the
world. The leadership in Somalia can therefore tap into
remittances sent by this group. This will provide funds
that could be injected alongside philanthropy funding
into provision of health and education services.
 Infrastructure financing could also be very important.
Banks are not only wary of making long-term loans,
they are also reluctant to take as much risk. Resources
are scarce and therefore countries seeking funds need
to attract investors by open labor laws. For instance,
financial incentive regimes, transfer-ability of capital
and so on..

13.  Climate finance is also important. Increasingly
climate finance also includes the use of
development finance, when that is used to achieve
climate objectives. Climate finance is based on the
premise that public funds will be needed for both
adaptation and mitigation and that those funds
will be needed to leverage private sector finance.
 The government should also build the capacity of
Small and Medium Enterprises. These create
formal jobs. There should be inclusive business
policies. These will help pursue economic and
socio-policy objectives that will see small and
medium enterprises play a role in the formal sector

14.  Innovative development financing is also
crucial. Citizens, governments of both the developed
and developing as well as corporations play a huge
role. Multilateral institutions also play a role but
government is still the main actor. Innovative finance
should therefore complement government funds and
not substitute. The government should therefore tap
into the diaspora, private capital flows as well as
encouraging private voluntary contributions through
matching funds.

15.  It should however be noted that the proposed
solutions are not that easy to implement.
 Somalia has been a very fragile state and there has
been unrest since 1991. This makes it a very hard
situation considering it is the hot-bed of the
terrorist group Al shabaab.
 There needs to be reformed policies and proper
negotiated structures to accompany the financing
opportunities proposed.
 https://youtu.be/Xv72Hh-9Fh0