The Financial Story Behind the Kismayo Disagreement

[Mintid Farayar]

Always follow the money and it gradually begins to makes sense...

Here's an excerpt from the latest issue of Africa Confidential (I've edited the clan specifications for Forum rules):

 

 

Disputes over the management of Kismayo port, recently wrested from Al Shabaab by the Kenya Defence Forces and their Ras Kamboni allies, are also proving a major test for Hassan’s government and for his personal authority. At issue are the millions of dollars’ worth of charcoal stockpiled at the port by 'D/O' businessmen. Currently, the UN Security Council bans trade in charcoal as much because of environmental devastation as because its sale profits Al Shabaab-affiliated businessmen. It is also illegal under Somali law. Yet KDF Brigadier Anthony Ngere has publicly advocated allowing the export of the charcoal stockpiled at the port, to the chagrin of some Western diplomats, who fear the proceeds will flow back to Al Shabaab.

 

Diplomats say pressure to allow the export comes principally from two Kenyan Somali politicians, Defence Minister Mohamed Yusuf Haji and Farah Maalim Mohamed, the Deputy Speaker of Parliament, from Prime Minister Raila Oginga Odinga’s Orange Democratic Movement. The thinking in Nairobi, some believe, is that the sales could benefit 'O' business people close to the Ras Kamboni militia leader, Ahmed Mohamed Islaan ‘Madobe’ (*******).

 

KDF and Ras Kamboni Brigade leaders, other militia and clan and business people spent the Eid holiday in Mogadishu, trying to push Hassan Sheikh into approving the exports. On 27 October, his office issued a statement saying Kismayo port would be open only for humanitarian deliveries and the charcoal would be going nowhere. ‘This is going to cause a real problem between Mogadishu and the Jubaland initiative pushed by Kenya,’ says one businessman who operates in Kismayo. We understand, however, that Kenya and Ras Kamboni are permitting charcoal exports out of the port anyway, in defiance of Hassan and posing a challenge to his determination to keep Kismayo as an integral part of Somalia,

[NGONGE]

^^ Your government (if the rumours about you are true) should appropriate the whole thing and sell it on behalf of the Somali people. This would diffuse the whole situation and throw Black Ahmed straight into the president's bed.

[NGONGE]

^^ Both are "your government", I'm a northeren breakway hater, remember.

[Mintid Farayar]

Somali president in u-turn over U.N. charcoal ban

 

By Mohamed Ahmed

Thursday, November 15, 2012

 

 

MOGADISHU (Reuters) - Somalia's president has reversed course on what to do about millions of sacks of charcoal stockpiled in former rebel strongholds and now says they can be exported despite a U.N. embargo on the trade.

Hassan Sheikh Mohamud three weeks ago fully backed a U.N. ban imposed in February aimed at cutting off funds to Islamist militants, but said he changed his mind after hearing from local Somalis.

 

"The U.N. and the Somali government banned the export of charcoal. But we considered the logical requests of the Somalis," Mohamud told reporters in Mogadishu late on Wednesday.

 

"It is impossible to reverse charcoal to trees. Somalis have invested cash and sacrificed time with this charcoal. However, no trees can be burned for charcoal," he said.

 

Residents and regional officials said charcoal was already being loaded onto ships at the southern port of Kismayu, al Shabaab's last major urban redoubt which it lost to African peacekeepers and forces loyal to Mogadishu six weeks ago.

 

Some Kismayu residents say that during al Shabaab's four-year rule over the city charcoal became an important driver of the local economy, which had become largely crippled by more than two decades of civil conflict.

 

The charcoal - an estimated three to five million sacks worth tens of millions of dollars - has become a growing source of tension for Mohamud, who is trying to extend his new government's authority beyond the capital and stabilise the south.

 

The Security Council's Monitoring Group on Somalia and Eritrea, an independent panel that reports on compliance with U.N. sanctions, says charcoal exports from southern Somalia in 2011 generated over $25 million for al Qaeda-linked al Shabaab.

 

Security Council diplomats have said the council is divided on the issue. Envoys say some countries fear the Kismayu merchants lobbying for the sale of the charcoal may still have connections to al Shabaab; Washington has indicated it would agree to the charcoal exports if the Somali government approved.

 

A Security Council envoy in New York said the U.N. response to Mohamud's comments "might be one for the lawyers". U.N. sanctions regimes allow for the possibility of exemptions. (Additional reporting by Abdi Sheikh in Mogadishu and Louis Charbonneau at the United Nations; Writing by Yara Bayoumy; Editing by Richard Lough and Sonya Hepinstall).

 

Source: Reuters

http://www.hiiraan.com/news4/2012/Nov/26868/somali_president_in_u_turn_over_u_n_charcoal_ban.aspx

[Mintid Farayar]

Back to Square one....

The charcoal at Kismayo port is still under FG embargo......

 

 

 

 

Madaxweynaha Soomaaliya iska fogeeyay Warbixin ku saabsan Dhuxusha oo ay daabacday Wakaaladda Wararka Reuters

Jimco, November 16, 2012 (HOL) — Madaxweynaha Dowladda Soomaaliya, Xasan Sheekh Maxamuud ayaa iska fogeeyay waribxin ay daabacday wakaaladda wararka ee Reutes, taasoo lagu sheegay in madaxweynaha Soomaaliya uu ogolaaday in la dhoofiyo dhuxusha taalla Kismaayo.

 

 

Warsaxaafadeed kasoo baxay xafiiska madaxweynaha Soomaaliya ayaa lagu xusay in madaxweynuhu uu shirkiisa jaraa'id ku sheegay in dhuxusha taalla Kismaayo ay u raadinayso dowladdu xal, balse uusan ogolaan dhoofinta dhuxusha Soomaaliya.

 

"Reuters si khaldan ayay u turjuntay shirkii jaraa'id ee madaxweynaha, mana jirto meel uu madaxweynuhu ku ogolaaday dhoofinta dhuxusha Soomaaliya, balse wuxuu sheegay in dowladdu ay xal u raadinayso dhuxusha taalla Kismaayo," ayaa lagu yiri warbixin kasoo baxday xafiiska madaxweyne Xasan Sheekh.

 

Qaramada Midoobay ayaa horay u mamnunucday dhoofinta dhuxusha Soomaaliya, iyadoo dowladda Soomaaliya ay ogolaatay arrintaas, balse dhawaanahan waxaa taagnaa muran ku ku saabsan dhoofinta dhuxul taalla magaalada Kismaayo taasoo ay dowladdu sheegtay inay xal u raadinayso.

 

"Madaxweynuhu wuxuu ku celinayaa mar kale inuu taageersan yahay go'aankii golaha ammaanka ee Qaramada Midoobay ee lagu mamnuucaya dhoofinta dhuxusha Soomaaliya kaasoo ay horay u dalbatay dowladda Soomaaliya, waxaana dhuxushu ay khatar weyn ku tahay dhirta Soomaaliya," ayaa lagu yiri warsaxaafadeed kasoo baxay madaxtooyada.

 

Ugu dambeyn, madaxweynaha Soomaaliya wuxuu qoraalkiisa kaga dalbaday wakaaladda wararka Reuters inay shabakadooda ka saaraan warka ku saabsan dhuxusha ee sida aan wanaagsanayn loo turjumay.

 

Maxamed Xaaji Xuseen, Hiiraan Online

maxuseen@hiiraan.com

Muqdisho, Soomaaliya

[Abwaan]

Apophis;887681 wrote:

There are tonnes and tonnes of the stuff already cut and lying about in Kismayo; I do not understand the logic behind not utilising this income. The federal government should get it's cut in federal taxes after it's sold but it's illogical to let the stuff lie there and rot.

Apo. You do not understand what UN resolution means? What would the consequences be? The problem over here is a lot of people are blinded by other things and they seem to ignore the reality.

The best suggestion that I could give for the charcoal issue would be for the government to buy it with a reasonable price, tax them and pay later when they can.

[Mintid Farayar]

Mintid Farayar;889306 wrote:

Somali president in u-turn over U.N. charcoal ban

 

Washington has indicated it would agree to the charcoal exports

if the Somali government approved.

 

Source: Reuters

http://www.hiiraan.com/news4/2012/Nov/26868/somali_president_in_u_turn_over_u_n_charcoal_ban.aspx

This is the diplomatic pressure/card the Federal Government possesses that I alluded to in earlier threads

[Abwaan]

I have to be honest that I was little confused with the president's speech the other day when he said, some steps will be taken with regards to the charcoal in question but the government will not allow that any more trees are burned. To me it sounded like we will allow a temporary exportation. He should have made it clear that "No charcoal will be exported whether this one or future ones, period".

 

You see, Abwaan is not blinded by clan and can disagree with the president in a nice way. Some SOLers should learn a lesson or two from me.

There is nothing wrong with critizing as long as it is based on the truth and it is done on a civilized way.

[Jacpher]

^But as Abwaan your views aren't always sophisticated

 

President Hassan is finally agreeing with local businesses in the region to not have their millions of investment go wasted. Glad the president gets it right this time.

 

Ngonge: It is Axmed Darky, not black. Ninku ma maskax madooba ee yuu bidha risbek.

[Abwaan]

Waryaa Jacpher adigu Abwaan baad shaqo ka dhigatay...Kaalay haddii aan live deris u ahaan lahayd tolow maxaa dhici lahaa? Haddii aad albaabka ii bannayn weyso waan kugu gabyayaa ee ogoow.

[Taleexi]

Deriskaa dagaalkaaga rabaa dooradaada iga cesho buu ku dhahaa comes to mind

[Abwaan]

lol@Taleexi. Jacpher waxa aan sheego ayaa dhiba which is ok, anigu in la ii cammiro SOL uma imaan, laakiin instead of focusing on the issue, Abwaan is this and that buu ku hayaa...Bal halkaas ka sii wad dheh.

[Jacpher]

Abwaan;889748 wrote:

Waryaa Jacpher adigu Abwaan baad shaqo ka dhigatay...Kaalay haddii aan live deris u ahaan lahayd tolow maxaa dhici lahaa?

Haddii aad albaabka ii bannayn weyso waan kugu gabyayaa ee ogoow.

Saaxiib gabay ha ii dambeeyee, ma dariskaa kaa dacwooday maba ogeynee.

[Abwaan]

lol@Waa kaa yarkii hadalka dadka u dusin jirey dhegweyn noqday.

[Mintid Farayar]

Why Charcoal May Endanger Somalia’s

Best Hope for Peace

By Tristan McConnell, Kismayo

Time

Nov. 28, 2012

 

On a Monday afternoon in October, in a warehouse in the southern Somali port of Kismayo, I attended a meeting on the future of Somalia. On one side: 20 Somali traders sitting on grass mats and wearing sandals, sarong-like wraps, short-sleeved shirts and embroidered scarves. On the other, in plastic chairs: officers from the Kenyan and Somali armies and the allied militia Ras Kamboni Brigades, who, fighting under the banner of the African Union Mission in Somalia (AMISOM), ousted the al-Qaeda-allied al-Shabab from southern Somalia’s biggest city a few weeks earlier. AMISOM’s offensive against al-Shabab, kicking them out of the capital Mogadishu in August last year and then capturing Kismayo, were a body blow to the Islamists and represent the best chance for peace in Somalia since the collapse of the last central government in 1991. But in Kismayo, as I discovered, as the only Western journalist to enter the city, the joy of victory had quickly soured. At stake at the October meeting, I was told, was nothing less than peace in southern Somalia, and possibly the whole country. And the key? A giant pile of burnt, dead wood.

 

Great progress has been made in Somalia over the past 15 months. Al-Shabab has suffered a series of military setbacks, a new Somali President has been chosen, a slimline government has been formed, famine has abated and Mogadishu is enjoying a newfound optimism after decades of destruction. The turnaround seems dramatic and it is, given 21 years of war and famine. But the truth is that while those tragedies gave the world an impression of a failed state without hope, for many Somalis, the enduring reality of daily life during the fighting — and at the heart of many of Somalia’s conflicts — was always business. Camel trading, mango growing, mobile telecoms and, of course, arms dealing all thrived in the war years. And few businesses were as big or profitable, or as tough, as charcoal.

 

The charcoal business grew exponentially under al-Shabab. While the group did not itself invest directly in charcoal, it levied taxes at every stage of the process, from production to export. U.N. investigators reckoned the group earned $25 million from the trade last year. So in February the U.N. banned charcoal exports in a bid to cut off funding for al-Shabab. Since then, charcoal has been piling up. There are now more than 4 million sacks of the stuff at Kismayo’s southern entrance, stacked in immense house-sized blocks of dirty burlap bags lining the soot-covered road. Its value is estimated at up to $40 million.

 

A boon to a postconflict economy, perhaps? Anywhere but Somalia. Matt Bryden, director of the Nairobi-based think tank Sahan Research and a former coordinator of the U.N. Monitoring Group on Somalia and Eritrea, which analyzed the charcoal trade, said a handful of traders controlled the trade and all of them had commercial, if not necessarily ideological, links to al-Shabab. “There’s no question that this is an al-Shabab-linked industry and those relationships don’t evaporate overnight,” he said. One Western diplomat with close knowledge of the situation told me that any sale of charcoal, even the relatively small amounts already known to be leaving Kismayo, means “the financial circuit has not been interrupted. The major financing for al-Shabab continues.”

 

All of which might make a resumption of the trade sound like a bad idea. But the businessmen, and some of al-Shabab’s enemies — all of them well armed — disagree. The city was captured partly with the aid of Ras Kamboni Brigades, an ethnic-******i-clan militia run by Sheik Ahmed Madobe. Madobe is a tall, bearded warlord who has himself undergone a remarkable rebirth. Five years ago he was an Islamist commander targeted by American missiles. Today he is a crucial ally in the war on al-Qaeda in Somalia. He wants the charcoal trade restarted. “The economy of this city is 90% charcoal,” Madobe told me. “Businessmen have invested a lot of their money and the U.N. embargo is blocking it. The stockpile cannot be returned to the trees. It should be sold.”

 

The dispute could have ramifications for attempts to install Somalia’s first central government in generation. Negotiations to determine the makeup of a post-Shabab southern administration, under way for a year without resolution, are now on hold, pending resolution of the charcoal dispute. As for attempts by the national government to establish its rule, earlier this month Madobe refused to meet a presidential delegation sent to Kismayo, issuing a scarcely veiled threat that he could not guarantee their safety if they entered the city. Says Bryden: “[This is] about power and resource sharing in the Jubas [the collective name for Somalia’s three southern regions]. People are looking at that big stack of charcoal and they want the profit.”

 

Some discern a nefarious international hand at work as well. Control of Kismayo means control of southern Somalia’s economy — and well-established, lucrative smuggling routes into Kenya, taking charcoal out and sugar in. With elections due in Kenya early next year, some suspect Kenyan politicians and military leaders of reopening the trafficking routes to feed their political slush funds. During my time in Kismayo, a trip to the port revealed Kenyan and Ras Kamboni soldiers overseeing the unloading of cement from a cargo ship and, from the fat bellies of two wooden dhows, timber, pasta, cooking oil and sugar. The dispute over Kismayo’s mountain of charcoal may endure for a while yet. But in the end, as it did through two decades of war, there seems little doubt that one way or another Somali business will triumph.

 

Source: Time Magazine