The war-scarred Somalia has lost its lustre as a market outlet for Kenya’s goods despite the heavy investments that Nairobi has made to restore political stability in the Horn of Africa nation.
Earnings from exports to Somalia last year slipped to a decade low amid erratic production and growing suspicions over long-standing maritime territorial dispute, provisional trade statistics show.
The value of exports, largely miraa (khat), contracted Sh3.24 billion, or 21.51 percent, to Sh11.83 billion in the 12 months ended December, 2019, compared with a year ago, data collated by the Central Bank of Kenya (CBK) indicate.
The income from goods sales to Somalia was the lowest since 2009 when they stood at Sh11.22 billion.
Mogadishu has over the years grown into a key market for miraa traders, fetching Kenya tens of billions of shillings annually.
Traders earlier blamed “longer-than usual” drought spells experienced between 2017 through April 2019 for erratic production of the stimulant.
This has been compounded by political tensions as a result of unresolved diplomatic tiff between Nairobi and Mogadishu which has slowed down exports, they said.
“The prolonged drought periods made miraa very scarce and it became very expensive (for Somali markets),” Kimathi Munjuri, chairperson of Nyambene Miraa Traders Association (Nyamita), said in an earlier interview. “We get another problem when it rains too much as the supply goes up and when we have plenty (of miraa), we all dump them there because it is the only market and what follows is that we don’t get payment on time.”
The two countries are embroiled in a long-standing row over the ownership of a triangle in the Indian Ocean measuring about 100,000 square kilometres believed to be rich in oil and gas resources.
The dispute is currently before the Hague-based International Court of Justice (ICJ) after Somalia took Kenya there in August 2014.
“There are also political interferences here and there. Sometimes, the government in Mogadishu just wakes up and says no miraa. These disputes are really affecting us and worries us a lot,” Mr Munjuri said.
Ethiopia has been the biggest beneficiary of the erratic supply of Kenya’s miraa to Mogadishu.
Sources: Business Daily Africa