Somaliland - Somalia
Berbera port holds key to Somaliland future

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IRIN - Somalia 

Somaliland President Mohamed H. Ibrahim Egal

«This country is going to be the first African economic tiger.»

Mohamed Ibrahim Egal

Misanet / IRIN - In the deep-water berth of Berbera port, Somaliland, the silent cranes and empty white warehouses dwarf the one small boat discharging its paltry cargo of bananas. The huge expanse of the quay is otherwise ominously deserted at a time when it should be teeming with livestock ready for export to the Gulf States for Idd al-Adha. 

The Muslim celebration is normally peak season at the port, in the self-declared state of Somaliland, northwestern Somalia. Sheep, goats and camels from all over the region are brought overland to the Berbera gateway on the Gulf of Aden, from where they are exported live. But this February, not one animal has left the shores, following a strict livestock export ban. When the first known cases of Rift Valley fever (RVF) outside Africa surfaced in Saudi Arabia and Yemen in September last year, the Gulf states slapped a comprehensive ban on all livestock imports from the Horn of Africa.

Loading, unloading and handling had reached record output at the newly improved port when it ground almost to a halt. "This is a disaster," said Ben Parsons, technical coordinator for the United Nations trade development body known as UNCTAD (United Nations Conference on Trade and Development). 

This time last year, the renovated port managed to export some 500,000 sheep and goats during the run up to the Idd. Saudi Arabia bought 98 percent of all the sheep and goats, while Yemen and the United Arab Emirates (UAE) together accounted for the remainder. In the first half of 2000, Saudi Arabia was also the number-one buyer of camels. Libya was the second biggest buyer, taking almost 11 percent of the total. Parsons points out that, other than Djibouti to the north, "no other port on this coast supports pastoralists as much as Berbera". 

Suffering the livestock ban
Berbera is not only a key regional corridor, but is also Somaliland's single biggest income generator. Exports from Berbera support farmers and herders in Somaliland, as well as those in the self-declared autonomous region of Puntland, northeastern Somalia. Livestock also reaches Berbera from southeastern Ethiopia and southern Somalia. With the imposition of the recent embargo, the lives of hundreds of thousands of pastoralists and traders have been adversely affected. 

- In northern and central regions [including Somaliland and Puntland] huge income losses have resulted from the Gulf livestock import ban, placing enormous strains on household budgets, warned the multi-agency Food Security Assessment United (FSAU) in its February report. Local currency has lost value, and there has been a dramatic drop in the amount of hard currency brought into the region. Imported and local cereal prices have risen steeply, and purchasing power has dropped. 

Petty traders in Berbera like Hadar Musa, who owns a small kiosk near the market centre, watched in horror as business disappeared. "The customers are getting less and less, and the expense is getting more and more," he told IRIN. His kiosk sells everything from sugar and rice, to sweets, sunglasses, scissors and cigarettes. He buys wholesale from traders, the middlemen who normally use hard currency from the livestock exports to buy up goods in the Arab states. But since last September, imports have rapidly dwindled, and prices have shot up. "One bag of sugar cost 70,000 Somaliland shillings last year; now it cost 93,0000," Hadar Musa said. "There is no way to compensate for this sort of loss." 

The loss for traders like Hadar is all the more unfortunate in that Somaliland, since declaring unilateral independence in 1991, had only recently begun to benefit from relative peace and stability. In 1988, northern Somalia was reduced to ruins in the civil war. Since 1991, following the ousting of former President Muhammad Siyad Barre, it has struggled to establish an independent administration, and to gain recognition. Over the last two years, many of the displaced and refugee populations have returned and rebuilt homes and businesses. 

Now, pastoralists and traders are not the only people suffering the effects of the livestock ban. In Hargeysa, capital of Somaliland, people beg for money next to traffic lights and in the town. Their numbers are increasing, grumble Somalilanders. One man - thin and ragged with his hand permanently outstretched - patiently bows his head towards each car as they stop at a junction next to the open-air gold bazaar. His story is that he was "laid off" in Berbera, where he used to find casual work loading and unloading dhows (defined in Berbera as vessels having less than two masts, a traditional, centuries-old construction) and ships. 

Poverty among vulnerable urban groups and internally displaced people (IDPs) increased sharply after the embargo because of the sudden drop in employment opportunities. Access to jobs "will be a key issue for poor urban and pastoral groups as the loss of income from the collapse of the livestock export market becomes more intense," FSAU said in its report.

Consumption patterns have changed, with people switching to cheaper cereals and reducing the amount they eat. Humanitarian agencies say they are watching a precarious situation that might suddenly deteriorate. 

Aid and development agencies have been urged "to make contingency plans" should normal coping mechanisms fail among poorer pastoral and urban groups, FSAU said. UNDP Somalia warned in a press release on 27 February that, since the ban, "serious concerns have developed for the food security and livelihood of poor households across northern and central Somalia". It said the heavy dependence on livestock production and trade meant that concern was "most grave for urban, displaced and pastoralist" groups in Somaliland as the long, dry Jilaal season approached. 

So serious is the loss of the export trade for the economy that the effects would continue to bite for some time even if the livestock ban was successfully lifted this year, FSAU warned. 

Reopening the market
The livestock ban amounts to an "unconventional humanitarian disaster", said one humanitarian worker - "it's not famine, it's not drought or war, but its effects are catastrophic". Senior humanitarian personnel admit that the response has been slow, because aid and development agencies were not sure how to deal with the crisis, and donors had been slow to understand the significance of its impact. 

It is not the first time a livestock ban has been imposed on the region, but it is the most comprehensive. Earlier bans have been partial, imposed by the largest purchaser, Saudi Arabia, - but circumvented through Yemen. This time there are "no back-door routes", Somali traders agree. 

During the period of the last ban, humanitarian agencies faced criticism from Somalis that the international community was not doing enough to mitigate its effects or to ensure that it was lifted. This time, Andrea Tamagini, Senior Deputy Resident Representative, UNDP Somalia, said UN agencies, donors and regional bodies were prepared "to intervene at the highest level" to try and facilitate the reopening of the market. 

From 27 February to 1 March a joint mission looked into the potential of the chilled meat industry in countries affected by the ban, including Somali territories. Veterinarians from the UAE, a veterinarian from the UN Food and Agriculture Organisation (FAO) and a senior project manager from UNCTAD/UNDP inspected abattoirs and inspection procedures in Somaliland, Puntland and the Somali capital, Mogadishu. It was part of a UNDP-funded initiative aimed at looking into the possible resumption of the livestock and meat trade between the Horn of Africa and the UAE. Before flying to Somalia, the mission had visited Sudan and Ethiopia, both also affected by the ban. 

In the brief time the team had at its disposal, it was not possible to carry out a detailed study on the RVF situation in Somalia. This might "require several years of study" warned the preliminary FAO report. It said, however, that because there had been no reported outbreaks of RVF anywhere in the Horn of Africa in recent months, the "chance of an animal infected with RVF virus entering the human food chain in the abattoirs in Somalia must be practically insignificant at present". 

Chilled meat is an option, because "the virus is rapidly inactivated in the carcass after death". The report pointed to the absence of reported cases of RVF in urban populations to support this. The team concluded that RVF therefore "should not, under normal climatic conditions, be a barrier to the trade in chilled sheep and goat meat". 

UNDP and FAO said they proposed to carry out a number of initiatives to more clearly define the risk of RVF in livestock from the Horn of Africa, and to propose ways of reducing the risk "to acceptable levels". UNDP Resident and Humanitarian Co-ordinator for Somalia Randolph Kent said facilitation of chilled meat would require technical support for the local administrations and private export sector so that international standards were met. He said UNDP/FAO would also support periodic inspections by international experts of Somali chilled meat processing infrastructure and procedures. Reports would then be submitted to the relevant national and municipal authorities in the UAE. A mechanism should also be established for the "certification" of exports to comply with international standards, Kent said. 

Developing the Berbera corridor
The significance of supporting trade through Berbera port has not been missed by international humanitarian agencies, and has become a focus for development work. 

- If you take a regional look, developing Berbera port is justified, one humanitarian worker told IRIN. Apart from being the traditional outlet for livestock from the Horn to the Middle East, Berbera gets trade from Djibouti, Ethiopia and southern Somalia. Bananas, sugar and rice are imported from Mogadishu. Livestock and hides come from Puntland, and - despite poor relations - a 'soft trade' continues with neighbouring Djibouti. Imports include pasta, sugar, flour and rice, which go out into an otherwise very isolated region. 

Berbera received a boost when Ethiopia lost access to the sea through the Eritrean ports of Assab and Massawa. The start of the Ethiopia-Eritrea war in 1998 did not see Berbera strengthen immediately. Before the conflict began, Ethiopia turned first to Djibouti, described by UNCTAD as "by far the most modern and specialised port of the subregion". With modern container facilities, it regularly handled about 1.5 million tonnes annually before 1998. By 1999, after Ethiopia had diverted from Assab, traffic through Djibouti reached almost 3.9 million tonnes annually, of which about 2.8 million was transit cargo, including petroleum products (UNCTAD Transport Newsletter November 2000). The increase caused congestion. Ethiopia's needs increased sharply in 2000 when it became the epicentre of a chronic regional drought, requiring international intervention and huge quantities of aid for the highlands and southeastern Ethiopia. 

But the heavy traffic flow through the Djibouti corridor exposed the poor condition of the transport system, particularly within Djibouti territory, which was trying to cope with some 250 trucks a day in each direction. The corridor includes the only international railway in the region, built between 1879 and 1917 and managed by a bi-national body - the Djibouti-Ethiopian Railway. "Existing transport infrastructure is insufficient, inadequate and in a poor state of maintenance," UNCTAD said in November 2000. The one old railway linking the coast to the highlands was "totally unsuited to deal with modern container traffic". 

In June 2000, the Djibouti government decided to improve the running of the port by granting a concession for the facilities to Dubai Port International. The move came when, in 1999, newly elected Djibouti President Ismael Omar Gelleh turned increasingly to the Arab states. The government was keen to improve efficiency, cut down on corruption, and develop the port as the hub for the Horn, a Djibouti journalist told IRIN. 

Relations between Ethiopia and Djibouti had in the meantime soured, for reasons including political concerns over Somalia and economic tensions over the port. A regional giant, Ethiopia had attempted to meet its considerable needs through Djibouti port by effectively "transplanting an entire operation", one regional port expert said. Ethiopia brought in its own workers, truckers, customs officials and security personnel, which provoked resentment among Djibouti port workers and traders. 

After relations soured with Djibouti, Ethiopia turned to Berbera. Apart from Djibouti, Berbera is the only port on the northern coast of the Horn able to serve the Ethiopian highlands. This is because of the two Somali ports on the Gulf of Aden, only Berbera is a deep-water port. The other Somali port, Bosaso, is a dhow port serving northeastern Somalia, with no roads connecting it to the Ethiopian highlands. 

Strengthening Berbera Port
By the time Ethiopia was showing serious interest in Berbera, the port had developed significantly from the decrepit and abandoned place it was in the early days of Somaliland independence. The new trading relationship between Ethiopia and Somaliland had important political implications for the region, and for the status of the self-declared republic. 

By 2000, international relief cargo for Ethiopia moved up rapidly to second place in the import category of goods handled by the port, according to Berbera port statistics. Ethiopia relief cargo, particularly wheat, amounted to 17 percent of imports during 2000, whereas previously this category had been nonexistent. By 2001, UNCTAD estimated that Ethiopian traffic through the port was roughly 30 percent of its total port traffic. 

The new attention paid to Berbera by Ethiopia also promised a regional dividend, as the Somali corridor road from Berbera to the Ethiopian border badly needed rehabilitation. Many of the bridges destroyed during the Somali civil war had not been replaced, and whole sections of the road were unusable. The European Union (EU), which had channelled aid through Berbera, proposed a US $4.2 million investment to improve the road from Harer, eastern Ethiopia, to the Somali border. A number of road investment projects within Ethiopia were also proposed, to increase capacity along the corridors carrying international trade. 

Development money was also used to upgrade and repair the road from Berbera to the Somaliland capital, Hargeysa - a critical move, which transformed a long, rough ride to less than three hours on a tarmacked highway. From 1996, the EC funded a number of high-priority and labour-intensive civil works, and provided additional funding to boost UNCTAD port management projects. From 1997, operational and administrative procedures were improved in Berbera port, and job-training schemes introduced and expanded. Spare parts were bought, equipment rehabilitated, drivers trained, and communication equipment - such as VHF, hand-held radios, faxes and phones - brought in to modernise operations. 

But the breakaway status of Somaliland imposed certain economic limitations. "The issue of recognition here matters," said one senior port worker. A robust and innovative private sector found it was saddled with political restrictions. Somaliland's unrecognised status means international financial institutions are absent, along with letters of credit, and necessary international standards. "Right now, you bring your goods, you take your chances, you have no recourse," said the source. 

For some, risk and illegality spells profit - but at a cost. Substandard ships arrive in Berbera, including those adapted to carry loose quantities of fuel. Last year, a small modified coastal vessel carrying petroleum burst into flames when the pump was turned on in the port, and the ship had to be tugged out to sea to burn off, said a senior port official: "I'm sure it is back in use already." If Berbera were operating under a recognised government, it would have to perform to certain standards, and subscribe to certain conventions, which a government would be compelled to enforce, said the source. 

Supporting trade structures in the unrecognised land had included assistance in drawing up agreements, said UNCTAD official Ben Parsons. In negotiating a deal with Ethiopia, for example - which wanted dedicated facilities at the port - Berbera has been encouraged to look for guarantees of quantities before lowering its tariffs, as well as securing guaranteed percentages for Berbera truckers. Assistance has included input into laws for banking, help in drawing up regional trade agreements and trading standards, immigration laws, transportation structures, and on-the-job training courses. 

But international recognition looks unlikely in the near future. One Western diplomat told IRIN that the attitude of his government to Somaliland independence was "breathtaking indifference". Achievements of relative stability and peace have paid off, however. If the recently elected interim government in Mogadishu fails to establish itself successfully, the international community is increasingly likely to want to "reward" Somaliland, the diplomat said. 

Even Ethiopia, which treats Somaliland as a de facto independent state, was unlikely to "go all the way" in bestowing full recognition, acknowledged one Somaliland minister. An international representative at Berbera port agreed that Ethiopia was unlikely to take such a step, because "as a regional superpower, it has other critical concerns with Djibouti, with Somalia, and with Eritrea". Nevertheless, Somaliland ministers point out that Ethiopia now accepts Somaliland passports, is negotiating the setting up of an Ethiopian bank in Hargeysa, and has begun twice-weekly flights by its national airline to Somaliland. Ministers who recently flew to Rome, Italy, for peace talks, said the Somaliland passport was also accepted there. 

Finance Minister Muhammad Sa'id Muhammad Ges told IRIN that Somaliland was "prepared to wait for as long as it takes." But the trading dynamic cuts both ways when it comes to the political agenda, pointed out one regional expert. A strong private sector has been crucial in establishing Somaliland as a viable and stable territory, but it will also be the first to go ahead and pursue interests in the south. "If Mogadishu port opens and business takes off, northern traders will start doing business with the south," one Berbera trader said. 

Anxiety over the issues of independence and recognition increased in Somaliland as the Djibouti-hosted peace process culminated last August in the election of the Transitional National Government (TNG). While, for almost a decade, there had been no authority in Mogadishu to contest Somaliland's declaration of independence, the new interim government has received widespread international recognition. Since transferring to Mogadishu in October 2000, the TNG has continued to struggle to secure the capital and establish itself in the south. Where it lacks presence internally, it has compensated by asserting itself internationally as the one legitimate authority in Somalia. For the new central authority, issues of legitimacy include those which directly affect Somaliland: the control of passports, currency, airspace, borders and regions. It also includes establishing recognised, centralised procedures to govern trade, such as certification and verification of livestock exports. 

Regardless of the political debate over the issue of recognition, developing the Berbera corridor is likely to be pursued in a regional context, as well as for the purpose of improving the Somaliland economy. One UNCTAD official told IRIN that "even if the port in Mogadishu opens, it's still easier to supply parts of Ethiopia from Berbera." Burao, in northern Somaliland, would continue to be the main livestock market for the region, he said.

The emergency cycle
Another reason for supporting trade in Somali territories was because trade had always cut through local and regional politics to some extent, including clan conflict, pointed out one development worker. Somalia's strong informal economy under the government of former President Muhammad Siyad Barre provided the basis for "the informal war-economy in the anarchic post-Barre period", said Dr Ahmad Yusuf Farah of the War-Torn Societies Project, Nairobi (Factional Reconciliation Process versus Arta Peace Initiative, January 2001). 

Farah said the business class was "composed of fiercely competing, freewheeling, individual traders tied primarily to their kin groups for protection and business opportunities". The dissolution of state monopoly on key economic activities had "provided fertile ground for the private sector to establish itself as the engine driving reconstruction". 

Efforts to support trade may succeed where conventional emergency aid had so frequently failed in Somalia, one aid worker told IRIN. "The port is the only venue where all clans have more or less equal access and rights to compete," he said. Supporting trade and commerce has also proved to be a way of strengthening the fledgling administrations, said one humanitarian source, with the port being "one of the few places where both the private and public sectors interact daily". 

Developing Berbera port, together with a regional approach to improving transportation, "will contribute to the stability of the Horn of Africa by fostering common economic interests", insists UNCTAD. 

But the catastrophic effects of the livestock ban threaten to undermine this. The challenge will be to ensure that there is sufficient and innovative response before the collapse of trade demands an emergency response itself, in a region trying to recover from widespread drought. "There is little point [in] encouraging recovery if you can't sell your animals... This is a crisis that must be a priority for the international community," Bronek Szynalski, UN Regional Humanitarian Coordinator for the Drought in the Horn of Africa, told IRIN. 

Fractured countries and economies
However, lifting the ban would not solve the root cause of the disaster, one local economist pointed out - which is that Somaliland and much of the region depends precariously on one trade.

- Even if the livestock trade resumes again, it can be cut at any minute: the export market is not in our hands, said Dr Muhammad Usman Fadl, the Somaliland minister of planning and coordination. He told IRIN that the economic challenge was to diversify, and move away from dependence on livestock and on importation of essential goods. An economy based on one major product and a few agricultural farms had, among other things, caused rural-urban migration and poverty, said Fadl. 

In many ways, the structure of the economy reflected both the strengths and weaknesses of a community which considered itself beleaguered, pointed out one regional expert. It is characterised by a determined self-sufficiency - remittances from a far-flung diaspora have supported and nurtured a territory that has suffered both civil war and international isolation. The constant flow of remittances has rebuilt ruined towns and villages, and has doggedly brought business to places capital would otherwise rationally avoid. Remittances had been "key to establishing both a functioning administration and a working economy", one local economist said. According to one senior administration source, remittances have also been crucial when "times get bad - like the livestock ban". "When the going gets rough, we pick up the phone and relatives abroad squeeze out a few more dollars," said the source. 

In this way, Somaliland has survived and grown, frequently against the odds, but has not diversified. There are six regions in Somaliland, which embrace opportunities for fisheries, salt production and gemstones. But despite the rich coastline, "it is still easier to buy and drink camel milk on the coast than buy and eat fish", pointed out one local economist. 

Coastal Somalilanders have not exploited fisheries for cultural reasons, and instead depend on livestock as heavily as those inland. Economists say there are sufficient resources to make the change, but tradition and culture constitute an obstacle. 

There is also concern that the environment is not able to sustain the large herds of livestock. In an ecological assessment of the coastal plains of Somaliland, the World Conservation Union (IUCN) said large concentrations of livestock combined with the cutting down of trees for charcoal and firewood have "had a profound effect" on the environment. In a report issued in May 2000, IUCN said "grazing pressure and soil erosion are now a serious problem and, together with periodic droughts, have had a devastating effect on the vegetation and soils". 

As early as 1947, there was concern over environmental degradation of the habitat in British-ruled Somaliland (which had the same boundaries as the unilaterally declared Republic of Somaliland of 1991). An official report said that "the soil and vegetation are on the brink of irretrievable ruin" on account of animal congestion and overgrazing, John Markakis recorded in "National and Class Conflict in the Horn of Africa" (1990). 

The effects of this heavy dependency on livestock are evident. Nomads have grown to rely more and more on imports such as clothing, spaghetti and vehicles, and there has been increased movement away from rural areas into the urban centres. Poverty and malnutrition have mostly been kept in check by community sharing and remittances, but many Somalilanders wonder for how long this can continue. 

Somaliland is not alone in its dilemma. Vulnerable economies are typical of the pastoral regions that feed into the Berbera corridor. Pastoralists who bring their sheep, goats and camels overland to Berbera port come mainly from areas characterised by marginalisation and insecurity, including southeastern Ethiopia, southern Somalia, and the two recently formed independent territories in northern Somalia, Somaliland and Puntland. 

Isolation, mobility and fierce independence have set nomadic cultures at odds with central authorities and modernising new states. The relationship between pastoralists and the central government has "often been ambivalent at best, at worst openly hostile... Pastoralists are no respecters of state borders," Richard Hogg said in "Pastoralists, Ethnicity and the State" (1997). Government policy-makers generally regard the pastoral areas - typically the borderlands and frontiers - as having little contribution to make to the national economy. 
They are often areas considered rebellious and difficult by central governments. "The defining characteristic of the relationship has been extractive and authoritarian," Hogg said. Attempts by the centre to impose administrative and political structures, monopolise the use of violence, and collect taxes, have made herders "state-resistant", John Markakis said (in "National and Class Conflict in the Horn of Africa", 1990). 

In the pastoral areas of southeastern Ethiopia, northern and southern Somalia, this political marginalisation has had dire economic consequences, including the lack of veterinary facilities and certification procedures, and the near absence of abattoirs, meat factories, good roads, airstrips, and communication facilities. Political marginalisation and conflict have also resulted at times in restriction of movement of people and livestock, destruction of water points, and confiscation of animals. 

Before declaring itself independent, Somaliland shared many of these features with its pastoral neighbours. Now, as a breakaway state, it sets a precedent, pointed out one regional expert. On the one hand, it symbolises the secessionism and resistance feared by central governments in the region and by international bodies. On the other hand, it faces the considerable challenge of having to establish a central administration and a diversified economy in a predominantly pastoralist territory. Key to this will be the fortunes of Berbera port. 

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