Commentary: National Economic Council (NEC) of Somalia * somalia, World News and Opinion.
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Commentary: National Economic Council (NEC) of Somalia

August 23, unveiling of the National Economic Council (NEC) of Somalia on August 12, 2018 in Mogadishu has sparked intense debate among Somalis because of serious misgivings about the role, membership, and ability of the NEC to foster the revival, development, and management of the Somali economy. My commentary reflects on the ill-considered context that diminishes the effectiveness of the NEC publically associated with the economic advisors.
Somalia is striving to become a unified federal state through democratic parliamentary system of governance based on the rule of law. The existing federal structures have yet to gain political and legal legitimization. In this context, the fragmented Somalia needs solidarity and political unity for shared peace, security, justice, and prosperity.
In June 2015, former Special Representative of the UN Secretary General for Somalia, Ambassador Nicholas Kay said, “Somalia is like building a house. The Federal member states are the foundation. The constitution and constitutional review is the walls. The democratization and the political election is the roof.” Thus, the highest priority of the incumbent leaders of the federal government is to accelerate the completion of the unfinished foundation (Benadir State), and to build permanent walls and roof before 2019. Perfecting the state building of Somalia will considerably improve the welfare of the Somali people.
Referring to articles 87 and 90 of the Provisional Constitution and a resolution of the National Security Council (NSC), President Mohamed Abdullahi Farmajo, on the proposal of the Minister of National Planning, Investment, and Economic Development, issued decree No. 98 dated July 12, 2018 that established the NEC. Neither the cited articles nor other articles of the constitution authorize the President to issue decree without formal decision of the federal parliament, Council of Ministers, or judiciary service commission. This proofs that the respect for the rule of law is lip service which bodes high risk for the future of Somalia.
As per article 2 of the decree, the members of the NEC are cabinet subcommittee (Ministries) for the economic affairs, Governor of the Central Bank of Somalia (CBS), Heads of the Federal Members States (FMS), and five (5) Somali economic advisers. Without explanation, the inaugural ceremony of the NEC celebrated the introduction of nine (9) economic advisors whose qualifications and expertise are undisputed. The decree is not mentioning the appointed four (4) foreign advisors and the terms of employment and accountability of all advisors.
As per article 3 of the decree, the responsibilities of the NEC are to advice the federal government on economic and financial strategy, policy, and programs, federal legislations, and compliance with domestic and international economic and financial obligations and matters. The President and the Prime Minister share the chairmanship of the NEC, which suggests misconception of the system of governance in Somalia. The power of guidance, coordination, and supervision of the executive functions of the federal government is vested in the Office of the Prime Minister.
The democratically elected leaders are continuing to follow the bad practices learned during the 21 years of the military dictatorship that destroyed the public administration and rule of law. Continuing to follow the dictatorial practices will not build a well-functioning public administration required for a functioning, accountable, and democratic state. The establishment of an institution under democratic system should follow policy and legislative process that adheres to the principles and best practices of effectiveness, sustainability, accountability, and country-specific state structure.
The NEC resembles the failed experiment of Policy Unit of former government of President Hassan Sheikh Mohamud. The Unit stifled the responsibilities and functions of the cabinet ministries and centralized the executive functions in the presidency. It fizzled out after some time.
The launching ceremony of the NEC gave the impression that the economic advisors were taking over the coordination authorities of the Ministries of finance, national planning, investment, and economic development, foreign affairs and international cooperation, and the exclusive responsibilities of the CBS as well as the planning and development responsibilities of economic ministries of petroleum and mineral resources, commerce and industry, water and energy, agriculture, livestock and forestry, ports and maritime transportation, public works, and fishery and marine resources.
The Governor of the CBS, an independent institution, advices the Council of Ministers and the federal parliament on economic matters. The CBS should have its own research department that provides economic analysis, data, and information needed in the economic and financial sector. The involvement of the Governor in the policy decision making process of the executive would compromise the independence of the CBS.
The NEC members representing the FMS have not been paraded. The heads of the FMS are members of the national policy making bodies like the National Security Council and Somalia Partnership Forum (SPF), and the Council of Interstate Cooperation. The role of the FMS in the national economic management has to be clarified in the permanent constitution.
The Ministers, the Governor, and heads of FMS rank higher than advisors. Constitutionally, the ministries are responsible and accountable for the development and implementation of their functions. Donors funded the hiring of many professional advisors to advice the federal and state institutions. Still, the Somali people are witnessing corrupt and dismal administration.
Speaking on behalf of the NEC advisors, Dr. Ali Issa Abdi, internationally known economist, former IMF official, and presently manager of the Horn Economic and Social Policy Institute (HESPI), underscored the need for security and political unity as precondition for economic progress. He listed the broad responsibilities of the NEC with the caveat that the NEC is only an advisory body that provides evidence based economic analysis and policy recommendations for implementation.
It is hard to believe the claims that the establishment of the NEC will boast economic growth, job creation, transparency, accountability, and sound economic management in the absence of permanent constitution, respect of the rule of law, efficient, transparent, and accountable national institutions, free market system, active civil society, political opposition, and free media. Furthermore, there are no reasons to believe that the leaders of the federal government will consider the policy recommendations of the NEC given the historical record that they have continuously ignored to consider the provisions of the constitution and the recommendations provided by the specialized international partners.
The World Bank submits periodically Economic Update Report to advice the federal government on macroeconomic management, development, job creation, public-private dialogue, and poverty reduction. The UNDP assists the federal government in improving the rule of law, governance, security, justice, and social services. The International Monetary Fund (IMF) prepares the Staff Monitoring Program (SMP) for fiscal policy and public financial management (PFM). HEPSI conducted studies and numerous trainings for high officials of the Federal Parliament and Government to improve the economic and financial management with no tangible results.
The International Network on Conflict and Fragility (INCAF) is pushing unsuccessfully the implementation of the partnership agreement and security pact signed in London on May 11, 2017. It has established the Somali Development and Reconstruction Facility (SDRF) and Financial Governance Committee (FGC) to support the federal government for the compliance with the international obligations on procurement and PFM. The disappointing progress for lack of serious commitment on the part of the Somali leaders has caused the suspension of the international assistance.
NEC will magnify the ineffectiveness of the federal government as long as the house of the Somali State is incomplete and in disarray. The constitution and the countless recommendations of experts explain what the federal government should do or the way it should do to expedite the reconstruction of the Somali house. The missing element is honest leaders with commitment and high sense of public responsibility and accountability.

Mr. Mohamud M Uluso

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