Somalia

15 Mar 2015

 

Economy of Somalia

The economy of Somalia like those of the neighbouring countries of Ethiopia and Kenya is a dual economy in which traditional production and the way of life are practised along modern production, with gradual graduation from traditional economic way of life to modern economy.

Somalia's economy, one of the poorest in the world, is an agricultural one based primarily on livestock and, to a lesser extent, on farming. Livestock accounts for about 40% of GDP and more than 50% of export earnings, mainly from Saudi Arabia; bananas are the main cash crop and account for nearly 50% of export earnings. Other crops produced for domestic consumption are cotton, maize, and sorghum. There are plans to develop the fishing industry. Northern Somalia is the world's largest source of incense and myrrh. There has been little exploitation of mineral resources, which include petroleum, uranium, and natural gas.

Despite the lack of effective national governance, Somalia has maintained a healthy informal economy, largely based on livestock, remittance/money transfer companies, and telecommunications. Most of the industrial production based around food processing collapsed as factories were looted during fighting, but there is a service sector (around 25% of GDP) based around the intermediation of remittances from and telecommunications with the Somali diaspora which is the main contributor to Somali economic development and reconstruction, providing resources for family support, humanitarian and development assistance and investment.

Nomads and semi-pastoralists, who are dependent upon livestock for their livelihood, make up a large portion of the population. Livestock, hides, fish, charcoal, and bananas are Somalia's principal exports, while sugar, sorghum, corn, qat, and machined goods are the principal imports.

Somalia's service sector also has grown. Telecommunication firms provide wireless services in most major cities and offer the lowest international call rates on the continent. In the absence of a formal banking sector, money transfer/remittance services have sprouted throughout the country, handling up to $1.6 billion in remittances annually. Hotels continue to operate and are supported with private-security militias.

Despite 17 years of crisis in Somalia, the economy there is stronger than that of many countries in Africa in terms of gross domestic product and imports and exports.

Essential Information

Area: 738,000 sq km
Population: 10,251,568 (2012 est.)
Capital: Mogadishu
Principal Towns: Merca, Kisimayu, Berbera, Hargeisa.
Languages: Somali and Arabic are the official languages but English and Italian are widely spoken in many towns.
GDP at current prices: $2.372 billion (2010 est.)
GDP at PPP: $6 billion (2011 est.)
GDP - per capita (PPP): $600 (2011 est.)
GDP - per capita (current): $234.6 (2010 est.)
GDP - real growth rate: 3% (2011 est.)
Climate: Tropical. Hot and dry inland and humid along the coast. Average temperature 27 degrees C to 32 degrees C. The higher altitudes of the north are generally cooler, although Mogadishu has the cooling south-east monsoon from June to October. There is little rainfall anywhere in the country.
Currency: $1 ≈ 1,550 Somali Shilling (SOS)
 
DEMOGRAPHY
Population: 10,3 million (2012 est.)
note: this estimate was derived from an official census taken in 1975 by the Somali Government; population counting in Somalia is complicated by the large number of nomads and by refugee movements in response to famine and clan warfare (July 2009 est.)
Age Distribution (2012 est.)
0-14 years: 44.3%
15-24 years: 18.9%
25-54 years: 31%
55-64 years: 3.5%
65 years and over: 2.3%
 
Population Growth: 1.596% (2012 est.)
Education: Of the total population 37.8% age 15 and over can read and write.

Somalia's National Day 
 

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Diplomatic representation of Somalia in Switzerland


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