Somaliland Diaspora Investment Consultative Meeting

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Somalilandsun- The first Somaliland Diaspora Investment Consultative Meeting was held on 25 March, 2018, at 9:00 AM – 12:00 PM at the seminar/training hall of Crown hotel, in the capital city Hargeisa, Somaliland.

The Honorable chairman of the Somaliland Diaspora Agency (SLDA) Mr. Abdi Abdullahi Hersi opened this meeting which six diaspora investors including men and women participated. There, a number of government authorities participated to answer questions that would be raised by the diaspora investors and to hear their complaints and challenges about their businesses. The distinguished members of the meeting from the government who were present to hear and answer to the diaspora investors were:-

1. Dr. Sa’ad Ali Shire, Minister of Foreign Affairs and International Cooperation

2. Mr. Mohamud Hassan Sa’ad, Minister of Trade, Industry and Tourism

3. Mr. Moahmed Ahmed Mohamud (Awad), Minister of Investment

4. Mr. Mohamed Shukri Jama, Chairman of Chamber of Commerce

This meeting had two main objectives which were firstly to share the challenges of the diaspora businesses with the government authorities to overcome or respond, and secondly to give a chance to the Somaliland diaspora entrepreneurs to ask the questions they need to the Somaliland government authorities. In the meeting, several questions were raised by the diaspora participants that touch different areas. The questions were as follows:

1. Technical skills and diaspora engagement. As a Somaliland government, what is the policy of the government to the technical skills? And what have you planned to do for the diaspora community?

2. Copyright and Brand name. Does the government have a policy to protect its citizens’ production or innovation copyrights?

3. Liquid transportation. Airline Companies do not allow their clients to transport any liquid goods and that is a big obstacle to export oil by citizens’ companies.

4. Contract enforcement. Sometimes it happens that two nationals signed contract each other and one of them withdraw. The availability of good contract enforcement and to practice enhance the predictability of commercial relationship and reduce uncertainty by assuring firms and individuals that their contractual rights will be upheld efficiently by the local court. Why does the government not have a law of contract enforcement?

5. 5. Somaliland and Ethiopian trade balance, Investment and the same level tax. As Somaliland citizens, our trade with Ethiopia is not balance. To export to Ethiopia is complicated but we can import from Ethiopia, though some goods are not allowed to import by Ethiopia. Why is that?

In addition to, some of the diaspora participants made suggestions to the government, and some of those were:-

1. Somaliland diaspora community need an informative website to be visited by the investors before returning to their original country.

2. For taking Somaliland Identity card by the diaspora members, it is unrecommendable to be required his or her chief (caqil)

3. To make a tax reduction for fishery firms and the availability of LC for the Somaliland and Ethiopian trade.

The government officials tried to answer these questions although some of them advised instead of direct answers.

Dr. Sa’ad Ali Shire, the Minister of Foreign Affairs and International Cooperation admitted the existence of some problems were presented by the diaspora members, and stated it is necessary to engage the diaspora investors. He showed fervor to the diaspora participants about Somaliland and Ethiopian trade balance and told that the trade agreement between those two countries is progressing.

One of the ministries who actively participated the meeting was Mr. Moahmed Ahmed Mohamud (Awad), the minister of Investment. The minister explained in detail to answer the questions about the tax and investment. He told that the progressive tax has not been working for the last two years and now it is flat rate. He accentuated Somaliland government levied the least tax in the world and he said, ‘in our country, the income tax is 5% while it is 30% in the other countries in the world.’ He also emphasized that the tax revenue was reduced and now it is 10% while it used to be 26%. What is more, he informed the diaspora investors the government does not impose tax on diaspora their furniture when they are moving to Somaliland except vehicles. Nevertheless, he underlined it is not easy to give land to the diaspora returnees to settle and he said, ‘now the land became our camels, but we will try our best.’ Continuing his discourse, the minister told that the foreign investment law is progressing but the major challenge to invest our country is less of banking system.

Mr. Mohamud Hassan Sa’ad, the Minister of Trade, Industry and Tourism who was one of the government representative members informed four points which are: the current progress of the Somaliland economy; why Somaliland Ethiopia trade is not pleasant, that he said Ethiopia is protecting its interest; tax holiday was given to all diaspora industry investors without limited period unlike to the rest of the world; being the first agenda of the government is to develop the service of education and promote the skills and technical schools; and the company code is being set and will be passed to the house of parliament. He also advised in four areas to the diaspora investors that are, the need to have a visibility program before establishing industry; the importance to adopt establishing companies and working groups among diaspora rather than individually; the need to have to grow our food and feed instead complaining from other country which restricted some of its economic sectors; and to address the diaspora investors’ complains to the convenient suitable institutions of the government.

Lastly Mr. Mohamed Shukri Jama, the Chairman of the Somaliland Chamber of Commerce who was showing a sympathy and narrated about his experience and long road of his success as an example as a diaspora person to the diaspora participants, profoundly presented several advices to motivate them not to be disappointed with investing their origin country. Firstly, he enlightened the diaspora returnees investors’ expectation from their origin country is high while the expectation and the reality is often different. ‘You lay out scenarios in your heads of something going well but things always don’t go as planned. You may face challenges which you did not expect but don’t let those challenges take you back to your host countries,’ he said.

Secondly, Like Mr. Mohamud Hassan Sa’ad, the Minister of Trade, Industry and Tourism, Mr. Mohamed Shukri encouraged the diaspora to invest by groups. Third advice, he emphasized it is always import for the diaspora to make consultation before importing goods and he said, ‘ for instance, to my surprise, one of the business women imported 2000 doors but unfortunately when those goods arrived at the Berbera port, it was found they were unusable in Somaliland and that causes loss.’ Finally, answering to one of the questions from the diaspora participants which were that Ethiopia restricted to export the feed, he said, ‘it is we who ought to grow the feed for our livestock.’

Lastly, the chairman of the Somaliland Diaspora Agency (SLDA) Mr. Abdi Abdullahi Hersi to conclude the meeting, he thanked to every diaspora participant, the government officials and his staff.

By the Somaliland Diaspora Agency-SLDA

 

 

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