Somalia has historically been divided into three heterogeneous regions - Somaliland, Puntland and South Central Somalia - with a history of internecine violence. Following the collapse of the Siad Barre regime (1969-91) the country descended into civil conflict with devastating results: gross domestic product (GDP) per capita and human development outcomes are now among the lowest in the world.
Now, following a fragile, but positive, transition mid-2012, Somalia has a full federal government in Mogadishu committed to inclusiveness, reconciliation and peace, based on a provisional constitution. Many observers hail the transition as a genuine break with the past, and the best opportunity for stability the fragmented country has had in the last two decades. The New Deal for Somalia Conference held in Brussels in September 2013, is a key milestone for the country and for a more sustainable and committed international re-engagement with Somalia.
The state’s collapse undermined basic service delivery, with a severe impact on human development outcomes. Out of 170 countries, Somalia is among the five least developed as measured by the 2012 Human Development Index. The pre-eminence of customary clan-based systems inhibit social cohesion and pervasive traditional practices such as polygamy, early and forced marriage, exclusion of women from education and employment opportunities, result in some of the worst gender equality indicators in the world.
With more than 70% of the population under the age of 30, Somalia is a young country with enormous development needs. Among the more urgent is food security which, together with displacement of a large share of the population, has led to a continuing humanitarian crisis that has spilled over into the wider region.
Somalia’s economy has been shaped and sustained by conflict. The 2012 Human Development Report estimates per capita GDP at US$284 - against a sub-Saharan Africa average of US$1,300 per capita. External aid (mostly humanitarian) and remittances are the key sources of income – but are not sustainable or translated into development efforts.
Official development assistance (ODA) per capita is US$75 (including both humanitarian and development assistance) which is double the average of US$36 per capita for fragile states. The other main source of revenue is remittances estimated at US$1 billion (US$110 per capita) which makes up 35% of GDP - the highest worldwide.
The unregulated state of the economy has allowed the private sector to grow although this is marred by elite capture of revenue sources, often by cartels linked to militias. Somalia has, for instance, received between US$304-317 in illicit gains from piracy since the first known hijacking in 2005, although it is not known how much has remained in country.
Livestock is the mainstay of the economy and is estimated to create about 60 percent of Somalia’s job opportunities and 40% of its GDP. The export of livestock and meat generates 80% of foreign currency.
The self-governing regions of Somaliland and Puntland have managed to develop basic processes and structures of public administration. In Somaliland, domestic revenue was successfully doubled in 2011 though in Puntland tax administration and enforcement remains nascent.
The disappearance of formal education systems has lowered the national enrolment rate to around 31% (22% for girls as compared with 34% for boys). Secondary school participation is even lower for both boys and girls, with net attendance ratios of 12% and 8% respectively. Barriers to education include limited or unavailable primary and secondary school facilities, prohibitive school fees, and conflicting household and livelihood demands. Girls, in particular, are less likely to attend school due to domestic responsibilities. Nearly 75% of females between 15-24 years are illiterate, one of the world’s highest levels of gender disparity.
Access to health services is poor even by Sub-Saharan standards. Life expectancy at birth is 51 years and infant mortality rates are estimated to be 108 deaths per 1,000 live births i.e. one in every ten children dies in the first year (UNICEF).
In 2009, there were an estimated 625 health posts and 225 maternal and child health centers in Somalia. Assuming a population of nine million, this amounts to just one health post per 15,200 people. What existing services exist, are provided by the private sector, including pharmacies and drug stores, which may account for high service fees.
In August 2012 the Federal Government of Somalia (FGS) was brought to power with a four-year term under a provisional constitution approved by a new parliament – ending Somalia’s long period of revolving transitional government at the federal level. Since its establishment, the FGS has emphasized improved governance and economic management as key pillars of its development plan and is also laying the foundations for the implementation of a federal system of governance. The new government is responsible for meeting important political, security and economic milestones during its term, including the passage of a permanent constitution and the preparation for national elections in 2016. Regional countries and international actors have re-doubled efforts to support and sustain this window of opportunity, endorsing a New Deal for Somalia at the September 2013 Brussels Conference and pledging US$2.4 billion against the Somali Compact, which includes a “Special Arrangement for Somaliland”. A Special Financing Facility (SFF), developed by Norway with World Bank support, has been put in place to finance critical expenditure in the first phase of the transition.