Commerce amid chaos
Canny traders adapt to anarchy
SEVEN dhows and three freighters float in the sunlit port of Mogadishu. White dinghies bob out on the petrol-blue waters. Fisherboys wade to the beach shouldering sharks and swordfish. Sandbagged machinegun nests protect peacekeepers from the African Union (AU). Together with Somali soldiers, the AU has pushed the Shabab (an Islamist militia linked to al-Qaeda) deep into the city, so there has not been a mortar strike on the port since October. “We’re open for business again,” beams a trader.
In 1331 a Muslim traveller, Ibn Battuta, described “Maqdashu” as one of best cities in the world in which to do business. Somalia’s capital has lost that distinction. On the upside, there is no taxation system to speak of. On the downside, there is no government to speak of either. (A “transitional government” more or less controls part of the capital.) No government means no irksome regulations. But it also means that contracts are hard to enforce, and that firms must spend 10% or more of their earnings on security measures such as gunmen.
Still, there are ways for canny traders to get by. Sales of imported electronics are brisk. Nine mobile-phone operators in Mogadishu offer cheap calls. It is hard to connect between networks, but that is beginning to change. Some operators, including Golis, HorTel and Telesom, have banded together to launch a mobile banking service allowing traders to send and receive payments on their phones. Read More
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