SEF London – The Somali Economic Forum (SEF) recently participated in the International Organization for Migration (IOM) and The World Bank Group Summits on Remittances as part of the African Institute for Remittances (AIR) Project. The first such Summit was held in Dakar, Senegal on 3rd March and the second Summit was held in Dare salaam, Tanzania on 7th March. At both Summits SEF Managing Director; Hassan M. Dudde was a speaker and panelist. The Summit included experts, well respected economists, World Bank, AU and IOM officials and including major government officials from both Senegal and Tanzania.
As a background to both summits the World Bank estimates that, every year, about 120 million people in Africa benefit from remittances sent by relatives and friends from the global African diaspora. In 2012 alone, 30 million African migrant workers sent close to US$60 billion in remittances. With scarce opportunities at home, the majority of migrants’ families in Africa depend on remittances for their survival, health, education, and sustenance.
Yet, both Summits emphasized the need for African states and international & regional bodies to better integrate their remittance operations aswell as adopting efficient methods to ensure the lowering transaction costs and leveraging the beneficial impact of remittances for African families. The Somali Economic Forum was invited due to the innovative role played by Somali remittance firms in pushing down transaction costs whilst at the same time providing an efficient and highly valued customer service. Indeed, during the Dakar Summit; SEF Managing Director Hassan M. Dudde was quoted as saying that; “Other states can learn a lot from Somalia when it comes to remittances.” Indeed, this is no surprise due to the fact that Somali remittance firms have offices all around the world to reflect the far flung nature of the Somali diaspora. During the Summit; experts and economists touched on the fact that Somali money transfer companies offer the most competitive prices not only in Africa but also the world.
In addition, Hassan M. Dudde touched on how in recent years there has been a structural shift whereby African commercial banks firms have repositioned themselves as commercial banks providing bank accounts, ATMs and other amenities found in Western commercial banks. As Mr Dudde touched on during the Summit; there have been various factors to explain this; firstly, this has been due to legislation in the US & UK which have called on major Western banks to close their accounts with African & Asian remitters. Their rationale for this was to prevent money laundering and the potential financing of terrorist activities. These same African firms have understood that a long term, sustainable plan is needed. A second reason for this restructuring of African remittance firms is to meet the ever growing demand for commercial banking activities and loans amongst Africans aswell as the shifting generational trend whereby second generation Africans in the diaspora will likely send far less money home.
Key recommendations that came out of both summits include;
- The gathering of recommendations from Government officials,, Diaspora communities, Civil Society Organizations, Academia, the private sector and other public agencies with regard to the future activities of AIR.
- The creation of a network among African governments and African Diaspora associations and platforms which are active in the field of remittances for the purpose of future liaison and information sharing.
SEF held an interactive Twitter Question and Answer session during both Summits by utilising the hashtags #SEFDakar and #SEFTanzania. The Social Media interactive session went viral with Twitter users around the world from Europe, North America, Asia and Africa tweeting their questions on Remittances and Somalia’s economy. Above all, SEF was able to show how social media can be utilised extensively to promote vibrant discussions regarding the economic development taking place in Somalia and throughout Africa.
All in all, both Summits were enlightening and informative and the Somali Economic Forum was pleased to attend and to share its policy recommendations for the billion dollar Africa remittances industry based on the success of Somali firms and methods.