By Rageh Omaar
Somalia has been a failed state for almost a quarter of a century. Until two years ago, the country in the Horn of Africa had been without any functioning government, security forces or police or basic administration for 22 years.
For that period of time the estimated 10 million Somalis living in the country were left to exist in an anarchic environment dominated by warlords who ruled over fiefdoms and their militia.
The civil war in Somalia saw millions flee the country and become refugees and citizens throughout the world, especially in Europe, the USA and Canada.
Very quickly, a financial lifeline was born that allowed Somalis living in the West to send money to loved ones back home.
Money Transfer Companies help send money back to Somalia.
Money Transfer Companies help send money back to Somalia. Credit: On Assignment
Money Transfer Companies, as they are called, are a vital means of doing this. Every year more than £1 billion is sent back to Somalia, supporting up to 40% of the population.
I have used it myself to contribute money to fundraising for local charities helping to refurbish a local hospital and build a national library.
But it’s a system that is facing a race against time. Last year, two major banks, Barclays and HSBC announced that they were going to end the support and service they gave to money transfer companies used by British Somalis.
It’s not just individuals who use the services. International agencies like aid agencies and the UN use it too.
Mark Goldring, head of Oxfam told me that “remittances are probably the most powerful form of international assistance (and that) the Somali community outside the country are sending more in one day than Oxfam sends in a year.”
Aid agencies, as well as individuals, use the system.
Aid agencies, as well as individuals, use the system. Credit: On Assignment
The UK government, which has played a leading role in coordinating international efforts to stabilise Somalia, and counter the threat of the militant Islamist group Al Shabaab, is also working hard to try to find a solution to keep the lifeline open.
Barclays and HSBC are going to end their support for the companies.
Barclays and HSBC are going to end their support for the companies. Credit: On Assignment
Although they have provided such services for many years, there are fears that Somali money transfer businesses are too unregulated and risky. Barclays has agreed to give the companies time to find a permanent solution.
I met with many British Somalis who told me how they and their relatives depended on these services. One man told me that he feared for the £70-100 he sent each month to his sister in Mogadishu, saying “for that money to be cut, my sister could be destitute or she could easily die”.
The UK Government is countering the threat of Al Shabaab.
he UK Government is countering the threat of Al Shabaab. Credit: ITN
Abdirashid Duale, the CEO of Dahabshiil, one of the biggest remittances companies, told me that if a solution is not found it will lead to a “problem that will affect the entire community, (and) UK foreign policy (trying to) deliver security and stability.
“So it is a challenge that needs to be addressed and I will do my part.”