Connect with us

Business and Finance

Somaliland and Puntland receive higher diaspora remittances than the rest of Somalia




Every year, members of the Somali diaspora send approximately $1.4b to their family, relatives, and friends in Somalia, exceeding all humanitarian and development assistance to the country. The remittances comprise around 25 percent.

Somalia’s annual overseas development assistance is estimated at $1.3bn.

Funds transfers from overseas citizens back into their home country play a very important role in countries like Somalia, where a large number of its citizens fled to the outside world, especially to the West, following the collapse of the state. These transfers help recipient families pay for their monthly basis needs such as food, water, education, and healthcare. It also helps families get access to credit. Sometimes, it helps many Somalis survive recurring droughts.

This money—usually small monthly contributions taken directly from working Somalis in the diaspora—is nothing short of a lifeline for the Somali people.

But what is less understood is how that money, the diaspora remittances, can contribute towards inequality among Somali communities, and which regions in the country receive more than others.

Yet only an estimated 40 percent of the population receives remittances. For these households, monthly remittance receipts range from $50 to more than $300, with an overall monthly average income from remittances of $229.

A report by the Rift Valley Institute, a non-profit organisation operating in Eastern and Central Africa, shows the relationship between remittances and the relative vulnerability of certain communities, and how remittances can contribute towards inequality.

According to the report, there is a clear link between the average levels of remittances, and the regions in which they are received. Regions in the north, Somaliland and Puntland, receive on average $254 per month, while regions in the south of the country, excluding the capital city, Mogadishu and the port city of Kismayo, receive $119; a significantly lower monthly total.

Populations who do not benefit from remittances are disproportionately found in the south, where there is a larger rural population, and where marginalised and ethnic minority groups are mainly found.

There is also a clear link between the distribution of remittances and dimensions of migration. The Somalis, who out-migrated first, predominantly came from the north of the country, particularly from Somaliland and Puntland. These diaspora populations are now well-established in the United States and Western Europe. These patterns have been further entrenched by subsequent migration, which is facilitated by remittance transfers from existing migrant communities in host countries and other formal processes, including family reunification programmes.

The rebellion in Somaliland (now a self-declared republic) against the government of President Siyad Barre, in the late 1980s, led to a mass exodus to foreign countries, especially to the US and the UK, before the rest of the country followed suit after the collapse of Barre’s government in 1991.

This regional inequality was considered an important factor in how the dynamics of the Somalia famine of 2011 developed, with remittance-receiving communities being less vulnerable to famine.

Clan dominance and socio-economic profile of particular clans also affect how remittances are distributed.

The 2017 drought and associated humanitarian crisis showed how Somali clans demonstrated contrasting abilities to mobilise external support and, by implication, levels of resilience.

The large and dominant clans, as well as the small but well-connected ones, were able to raise funds abroad due to their historical migration patterns and the size of their current diaspora populations.

However, clans that are agro-pastoralists and whose communal identity is based on a combination of family-lineage and land-based territory responded to the drought less successfully.

Clans whose family structures are looser and who historically have had a less prominent national political profile, and whose diaspora is smaller, raised comparatively little money from abroad.

Despite playing a crucial role in Somalia’s economy and helping families meet their basic needs, remittances do contribute to inequality.



Leave a Reply

Your email address will not be published.


African business leaders to follow on Instagram




Business Insider has put together a list of five successful African business leaders to follow on Instagram.

These people frequently use their platform to share the best advice, business tips, updates on investment opportunities, or suggestions on raising much-needed funds. Plus, they also give you a sneak peek of what their lifestyle looks like outside of the business norm people know them for.

1) Tony Elumelu

Businessman, coach, and thought leader Tony Elumelu seeks to empower young Africans to achieve their dreams. He’s become one of the most recognised faces in leadership coaching, helping many aspiring entrepreneurs reach their maximum potential. His Instagram has garnered much attention with over 600,000 followers because it’s not only a source for inspiration with motivational quotes and videos, but it also gives you a glimpse at Robbins’s personal life.

2) Strive Masiyiwa

The Econet founder and chief executive sits on the board of multiple international organisations, including Bank of America, Rockefeller Foundation, and Unilever. He’s passionate, disciplined and motivated, and uses Instagram to teach others to be their best selves. With more than 280,000 followers, strive shares motivational quotes, updates on what he’s doing and other catchy images that will get your heart pumping.

3) Ibukun Awosika

Ibukun is an academic, astute businesswoman and powerful motivational speaker. Awosika is the immediate past Chairman of First Bank Plc. She is the former chair of the Board of Trustees of Women in Management and also sits on the board of the Nigerian Sovereign Wealth Fund.

Awosika trains people to be brave, authentic and effective leaders. To her 240,000-plus Instagram followers, she shares some of her favourite things (such as books, scriptures, and idols), motivational quotes and inspirational images that show her balanced and healthy lifestyle.

4) Vusi Thembekwayo

Serial entrepreneur, bestselling author, international speaker and internet personality Vusi Thembekwayo is one of the most inspirational business leaders of our time. As a venture capitalist, he has transformed businesses across the continent through his expertise in leadership and strategy. His direct approach personality pushes his followers to face challenges head-on. With 390,000-plus followers, his Instagram account is full of motivational quotes, videos and lessons to help you launch a business and pursue your passions.

5) Tara Fela Durotoye

A mother of three and a successful beauty entrepreneur, Tara Fela-Durotoye lives a busy life and shares it with her 280,000-plus followers on Instagram. Her bubbly, positive, and healthy lifestyle shines through her Instagram posts with inspiring quotes, pictures of her husband, relaxing scenic images and some of her favourite books.

Continue Reading

Business and Finance

40 million Africans could fall into poverty this year




At least 39 million people could pass on as an added number to 30 million individuals rendered poor in 2020 as a result of the pandemic, the president of Africa Development has said.

According to Dr. Akinwumi Adesina, the “people impact” is the worst negative consequence of the pandemic as over 30 million people have lost their jobs, and inflation is spiralling out of control.

“The debt also began to accumulate. The debt to gross domestic product (GDP) went up to between 60 and 70 per cent. But that is just on the financial side. I am more bothered about the people’s impact,” he noted.

However, Dr. Adesina highlighted that 85 per cent of operators in the special economic zones of Africa believed that the foreign direct investment (FDI) flow to the continent would rise significantly again, while 90 per cent outside Africa believed the same.

In his statement, he explained that Africa holds the key to the global economy with enormous opportunity for return on investment (RoI), stressing that the continent has improved tremendously in the ease of doing business.

The President also called for “resilient and quality” infrastructure to make Africa truly attractive to the rest of the world after addressing the issue of poor infrastructure that has blighted the potential of the continental economy. “Recent investments by AfDB and other stakeholders are reversing the story,” he said.

Dr. Adesina was speaking at the virtual Africa Singapore Business Forum.

Continue Reading

Business and Finance

Fueled by Covid pandemic, Kenya’s mobile money transactions surge 52 percent in the first 6 months of 2021




Mobile money transactions in Kenya has increased by 52 per cent in the first half of this year compared to 2020, as citizens continue to embrace digital payments as part of a measure to contain the spread of Covid-19.

from last December, when the country recorded the highest ever rate of mobile money transactions worth Sh605.70 billion.

Other insights from the central bank’s report showed that the number of registered mobile money accounts increased by six million to 67.8 million accounts at the end of June 2021 from 61.7 million at the end of June 2020. Similarly, the volume of mobile money transactions increased to 175.8 million transactions in June 2021, from 143.1 million transactions in June 2020.

The perceived growth in the volume of mobile money transactions in Kenya also spurred an increase in the country’s total active mobile money agents. According to the central bank data, the active mobile money agents increased by 63,820 to 301,457 agents in June, the highest level on record, up from 237,637 agents in the same period last year.

Safaricom’s M-Pesa service processed more than 90 per cent of the total transactions in the period under review as the platform has over 247,000 agents serving 28.31 million active customers spread across the country. This led to the payment service (M-Pesa) generating Sh82.65 billion in revenue for the network operator in the last financial year.

Globally, Kenya and Ghana continue to dominate the mobile money market as the two countries rank second and third after China in the highest mobile payment usage, according to a 2020 report by American research firm Boston Consulting Group (BCG).

Data based on the report estimated that the two African nations contributed between $15 trillion and $20 trillion to the total value of mobile financial services transactions in 2020.

Continue Reading


The Frontier is for the people — not the politicians, lobbysts and the powerful. We provide indepth and thoughtful analysis of what is happening around your world. We tell exclusive stories that matter to our audience, so they make better decisions and understand what is real.
Privacy Policy
The Frontier is committed to putting its users first. We strive to be transparent about how we collect and use your data and information, to keep them secure and to provide you meaningful choices. This Privacy Policy is meant to help you understand what information we collect, why we collect it and what we do with it

Copyright © 2017-2021 The Frontiere. All Rights Reserved. Design by Rick Consult