Drought-hit Somalia reels under drop in US remittances
By Mohammed Dhaysane and Hassan Isilow
A dollar sent from the U.S. can get a family in Somalia a kilo of rice. With $5, one can get a 11-kilogram bag of flour. And, if a Somali migrant in the U.S. sends between $100 and $150, it is enough to feed a family of eight at an internally-displaced camp.
Every dollar sent as remittances counts in Somalia. But ever since the Donald Trump-led administration imposed tough new measures on the Horn of Africa country, including a blanket travel ban on all of its citizens, Somalis have been complaining that it is becoming increasingly cumbersome to send money back home, with some families in the capital Mogadishu saying the crucial lifeline from their relatives abroad has come to a halt.
Asma Ahmed, a mother of eight, who hails from Somalia’s Mudug region that has been severely affected by the drought, told Anadolu Agency she has not received remittances from her family in the U.S. due to new post-Trump restrictions.
“We lost all our livestock in the region and, shockingly, my family in America tells me they can’t send money home because of restrictions,” she said with tears rolling down her pale face.
Ahmed said such restrictions are only making life harder for them as without support from relatives abroad she cannot afford to buy food, seek medical attention or send her children to school.
Yassen Abukar, a 63-year-old Mogadishu resident, told Anadolu Agency it is wrong to associate remittances as support for terror groups like al-Shabaab instead of seeing it as a key support system for ordinary Somalis.
“There are no jobs in Somalia. Most of us depend on the little remittances sent to us by our families overseas. We have nothing to do with al-Shabaab,” Abukar said.
According to the World Bank, Somalia earned $1.4 billion in remittances in 2015, which supported 23 percent of its gross domestic product.
Mogadishu-based political analyst Mohamed Alim also said remittances are a “lifeline” for most Somali families.
“Without these remittances, communities here would not survive, especially during this looming famine,” Alim said.
– Restrictions on Somalis in US
Hawo Mohamed, who is based in Buffalo city in western New York, confirmed the new bottlenecks on Somalis trying to send money to their families.
“I tried to send money to some of my family affected by the drought in Somalia this week, but I was told the [money transfer] operator in Buffalo had closed shop,” Mohamed told Anadolu Agency via telephone.
She said she was advised to go to the U.S. states of Ohio or Minnesota. “I don’t know why the [money transfer] operators in Buffalo and neighboring Syracuse shut down. Possibly it has something to do with [the new U.S.] government,” she added.
According to the Somali embassy’s website in Washington, an estimated over 250,000 Somalis live in the U.S. While some are reporting that some money transfer operators in the U.S. have shut shop, others say they have to limit their transactions to $700 a month to avoid suspicion.
Some say they risk interrogation by the police if they exceed the normal amount they usually send home or make around three transactions per month.
“In Ohio, we can still send money but you can’t exceed a certain amount lest you create suspicion with authorities,” Farah Abdi told Anadolu Agency.
– Drought worsens
Nothing is ever easy in a place like Somalia, which has seen years of civil strife, terrorism and now drought that’s threatening to break into an all-out famine.
Millions of people have been affected; according to the UN, around half of Somalia’s population — six million people — faces the largest humanitarian crisis since 1945.
The government declared a national disaster after drought hit at least 11 regions, including Bay and Bakol, where at least 110 people died of hunger and waterborne diseases over 48 hours in March.
The country witnessed famine just a few years ago and Somalis now fear a repeat of 2011 when at least 260,000 people lost their lives.
– Weak financial institutions
Somalia has been wracked by two decades of civil war, one devastating result of which is that the country still lacks strong formal financial institutions. All monetary transactions are now done through money transfer operators, known locally as Hawala, since Western Union and other international banks do not send money to Somalia.
All Hawala transactions are done in U.S. dollars. The United Arab Emirates is the capital of nearly all such transactions and almost all Hawala operators transfer their money through Dubai city.
Somalis living abroad go to a registered Hawala agent, who charges them a fee and gives a password that is then given to relatives back in Somalia.
The agent in the U.S. then sends a list of names of recipients to their branches in Somalia where the money is then handed over to beneficiaries. Recipients are expected to come with an identity card and a password to prove the money belongs to them.
Ever since the 9/11 attacks in the U.S., Hawala operators have come under exhaustive scrutiny worldwide and now all money flows are strictly monitored. While the checks are already said to be thorough, Somalis are reporting that it has become stricter since Trump came into power.
Kaisar Hajji, resident of U.S. city of Minneapolis, told Anadolu Agency via telephone that while he can still send money home from his state, the scrutiny is now very tight.
He said previously one could send money through a Hawala agent even without showing their U.S. Green Cards, but now it was compulsory to show that card, details of which are then recorded. Somalis are also asked about their U.S. residential addresses and purpose of sending the money. Hawala owners then provide these details to banks where they hold their own accounts.
The U.S. government has been advising Somalia to improve its financial institutions to avoid remittances from falling into the hands of al-Shabaab militants. Last year, Somalia signed into law a bill on the money laundering and financing of terrorism activities in a bid to create confidence with western governments and keep the remittances flowing.
The World Bank also started working alongside the Central Bank of Somalia in 2016 to implement a number of activities aimed at tackling key deficiencies in the Somali financial sector affecting remittance flows to the country.
During his campaigning days, Trump had warned Mexico he would stop the flow of remittances from the U.S. While the new president has not threatened Somalia with such a dire move, Somalis fear that any further action such as a complete ban on Hawala transactions could basically strangle the flow of remittances and hit their families and the country hard.
– Call for easing restrictions
Abdullah Mohamed Sheikh, secretary of the Somali Remittance Association, told Anadolu Agency the new restrictions in the U.S. are creating delays in transfer of money, which in turn worsens the current humanitarian crisis.
“Millions of people who need assistance from their relatives abroad can’t get it on time,” Sheikh said.
Somali lawmaker Abdifatah Mohamed also told Anadolu Agency the restrictions were a huge concern for the Somali government.
“Almost 2.5 million Somali’s depend on their families outside the country especially Europe and the U.S. for remittances,’ the MP said.
He appealed to the international community to stop restrictions on remittances to Somalia saying it’s a lifeline for survival.