Editorial

One of the Stability Fund’s objectives is to support ‘legitimate, viable governance structures’.  This phrase, which fails the plain English test, belies some of the subtlety and thinking that went into its formulation.

We talk about ‘governance structures’ rather than ‘government’ to reflect the range of organisations the Stability Fund can work with.  Yes, this includes the Federal Government of Somalia, the governments in Puntland and Jubbaland, and emerging federal states such as South-West State.  But it also means district administrations, village and community councils and even private sector organisations.

And we talk about ‘legitimate’ and ‘viable’ knowing that there are multiple (and often conflicting) views in Somalia about which particular elements of Somali governance have the local acceptance and ability to take and enact decisions that affect people’s lives. These are critical factors the Stability Fund considers when making decisions about its governance projects:  is the structure in question legitimate and viable enough for the Fund to consider supporting it, and what effect in turn will the proposed support have on the legitimacy and viability of that structure?

This edition of the newsletter focuses on some of the Stability Fund’s core governance projects – at federal, federal state and district levels.  On top of the self-evident technical and practical challenges of these projects, questions about viability and legitimacy of the governance structures concerned have remained at the forefront of the Stability Fund’s thinking throughout.

Caretaker Administrator Training

Since February this year the Somali National Army, working alongside AMISOM forces, have liberated twelve major towns and district capitals from Al Shabaab.  Following liberation, it is essential that local government structures take root so that the Somali state can begin to assert some authority and control in the newly recovered districts – both to mitigate the risks of a power vacuum and to begin the process by which basic services such as security and justice might be provided to the people of these districts.

The Somali Ministry of Interior and Federalism (MoIF) set out the process by which it envisaged district administrations would be created.  The MoIF’s ‘Stabilisation Plan’ started with deployment of twelve-person Caretaker Administrations to each of the districts, and then set out a process of creating interim and then permanent administrations.  Under the plan, this political work is to be complemented by projects aimed at improving government infrastructure and supporting community priorities in the districts.

But the first step was to train the individuals the MoIF had identified for deployment to the districts as Caretaker Administrators, to bring them together in Mogadishu and to prepare them for the daunting task that lay ahead: to be the first Somali government officials in districts that had long been under the control of Al Shabaab.

So it was in April this year that the Stability Fund, jointly with Sweden (which has since become a donor to the Fund), contracted the Electoral Institute for Sustainable Democracy (EISA) to develop and deliver training to some 165 caretaker administrators.  Working closely with the MoIF and other Stability Fund consultants, EISA designed a week-long training package covering issues ranging from the roles of the caretakers, through service delivery on to how to manage the process of establishing interim administrations.  The course was run three times over consecutive weeks, ending with a graduation ceremony attended by President Hassan Sheikh.

While the graduation ceremony marked the end of the training, it was just the beginning of the historic task faced by the administrators who have since deployed out to 12 districts where they have started to lay the foundations for governance and development.  The challenges faced by these individuals are immense – not least the hardships posed by insecurity, austere conditions and poor access, but also the difficulties of negotiating conflicting political agendas, advancing the local process of establishing interim administrations, and delivering some support to the local population to demonstrate the benefits governance can bring.

The caretaker administrator training course was also just the beginning of the Stability Fund’s work to help build effective governance and deliver tangible results to the population.  The Fund is working in several of the newly recovered districts to support the administrators and implement the MoIF’s plan, and will continue to expand its presence as more and more districts become accessible.

Rebuilding and reconnecting with Warsheikh

In March 2014 the Somali National Army, working alongside AMISOM forces, liberated Warsheikh district from Al Shabaab.  Warsheikh is a historically-important coastal district located 60 kilometres north of Mogadishu in the Middle Shabelle region of Somalia. Warsheikh has cemeteries of many Somali Sufi Saints and traditionally was home to numerous Sufi Scholars who enjoyed the respect and love of the Warsheikh community and the whole of Somalia.

As one of the newly liberated districts, a temporary, caretaker administration for Warsheikh was formed through a district structure consisting of District Commissioner (DC), Vice-DC and a Police Commissioner. In May 2014, coordinating with the Ministry of Interior and Federalism (MoIF), the Warsheikh DC was one of the district officials to participate in the caretaker administration training programme.  

Following a joint planning session in Mogadishu with the Stability Fund and USAID-funded TIS programme, in June 2014, along with officials of the MoIF, we visited Warsheikh district to carry out a preliminary assessment.

During our sessions with the Warsheikh community and district administration several priorities were identified. Support to foster economic growth was prioritised, as well as basic services. And so, in addition to support for the local fishing industry, provision of safe drinking water and solar street lighting were selected for immediate investment.  

The Stability Fund and MoIF, together with Warsheikh District Administration, is signing a Memorandum of Understanding to formalise agreement on the support to be provided in Warsheikh district. Now it is time for the real work to begin: drilling boreholes, providing equipment to fishing cooperatives and installing solar streetlights will be our focus over the next several months.

The road to establishing IJA’s Public Financial Management Framework

In February 2014, the Stability Fund began providing technical assistance to the Interim Jubba Administration (IJA) to establish a sound Public Financial Management (PFM) framework and the necessary infrastructure for financial operations to commence by July 2014. This aggressive timeframe was met largely due to the commitment of the IJA leadership to implementing superior public financial management systems.

The IJA’s enactment of the Public Financial Management Decree 2014 recognized the Minister and the Ministry of Finance (MoF) as the custodian of IJA financial matters and a legal framework for PFM. Expenditure management procedures and a robust commercial Financial Management Information System (FMIS) have been developed for use by the MoF and all other government bodies. Working closely with Stability Fund, the IJA has also completed an initial review of subnational government revenue and has developed a decree to formalize revenue raising.

In September 2014, the Stability Fund delivered a two week seminar for 25 IJA officials to introduce them to the PFM framework and procedures.  This included staff from line ministries and agencies for the first week, followed by more intensive training for 12 newly-recruited Ministry of Finance staff during the second week.  By the end of the seminar, through a practical, learning-by-doing approach to capacity building, the FMIS was fully operational and the recently-approved Budget for the second half of the 2014 fiscal year had been entered into the system.

The next step, as envisaged in the 2014 Budget, was to formalize responsibility for revenue collection in a new Revenue Administration (The IJARA). A workshop to outline the strategic plan for establishing the IJARA was completed in Kismayo in October. Banking arrangements have been established with Dahabshiil Bank, providing safe cash storage, deposit and withdrawal services, and full transaction reporting.

The IJA’s system features a Budget Classification Structure (BCS) that allows the MoF to control and account for all revenues and expenditures based on the IMF Government Finance Statistics (GFS) framework.  This particularly applies to donor funding provided directly to the IJA, which can be uniquely identified. The use of the donor funds can accordingly be tracked and reported in line with International Public Sector Accounting Standards (IPSAS).

In recent months, the MoF has continued to progress implementation of its PFM framework, with limited technical assistance and support from the Stability Fund. The ministry continues to collect revenue, which is now all deposited in the IJA’s Treasury Single Account (TSA) in Dahabshiil Bank. While a permanent ministry building is being constructed, financed by the Stability Fund, the Minister is operating from secure temporary offices. With just 10 laptops and a reliable internet connection the budget department is now finalising the FY 2015 budget.

The Stability Fund is proud to have had the opportunity to work with the IJA on establishing its PFM framework. The degree of commitment and ownership shown by the IJA, from the President to data entry clerks, bodes well for the future of an administration that will thrive by embracing the principles of financial transparency and accountability, and delivering public services in return for government revenues.

Editorial

It is widely acknowledged that the solutions to Somalia’s instability must come from within Somalia, and the phrase ‘local ownership’ has become a ubiquitous buzzword in the Somalia aid community.  Yet more often than not, the key organisations and leaders that manage development funds are internationals or diaspora.  While there is little question of the important roles that international organisations play and will continue to play in Somalia, there is a challenge to find and nurture Somali-led and Somali-owned entities to set the agenda.

That is why, in addition to its objectives of supporting local governance and reducing conflict, the Somalia Stability Fund is charged with supporting and developing Somali organisations.  Back in January this year, the Stability Fund started the search for capable Somali organisations, with strong people and good ideas that we could support.  We targeted our search around two areas: organisations supporting economic opportunities for young people, and the private sector.  Some 200 applications and months of shortlisting, selecting, negotiating and supporting later, we have selected four successful investments.  In our first newsletter, we’re proud to showcase two of these investments: Somali Green Initiatives & Technology and the Center for Education and Development.

Of course the Stability Fund itself has significant international and diaspora staff within its ranks.  But, we now have a strong permanent presence in Mogadishu, Baidoa and Garowe, and over the last month have travelled the length and breadth of the country from Sanaag in the north to Lower Jubba in the south, in addition to over a dozen paces in between.  We will continue to expand our coverage  and the number of Somali organisations we support.

Ivan Parks
Stability Fund Director

Danwadaag provides a new beginning

A quiet night in the streets of Baidoa ended in turmoil as a huge fire in Baidoa market engulfed numerous stalls and a warehouse. The fire consumed property and stock worth hundreds of thousands of dollars, rendering hitherto low and middle income families destitute. Hundreds of town residents battled the raging fire over three hours but salvaged almost nothing.

Lishwa Nurow Adan, a mother of eight children lost her stock of over $4,700 as well as $14,400 in cash that she kept in the store. “I stopped trusting the bank, when people were cut off from their own money and  Al Barakat bank’s activities was frozen, that is why I kept my money in the shop’’.

Ibrahim Issaaq, married to two wives with ten children, sold shoes, mainly women’s, but also stocked children’s and men’s shoes at the market. “I take over $2,000 worth of shoes from wholesale suppliers on credit, sell the shoes at a profit and pay my supplier’’. He lost his entire stock.

Danwadaag, which means 'common interest sharing', is a community driven development initiative designed to enhance stability and boost recovery in Baidoa. The initiative is led by a task force elected from the community, and supported by Danish Demining Group and the Stability Fund. Though the initiative is aimed at longer-term development activities, understanding the need to take account of immediate needs in the wake of the fire, and in the Danwadaag spirit, the task force held several meetings with the local authorities and the business community to consider ways to assist the affected traders.  A committee of nine members, comprising representatives from the local authority, business community, religious leaders and victims agreed to raise funds from the local community. The community contributed over $33,000 to which the Danwadaag initiative added a further $72,000.

Lisha Nurow Adan received $3,500 USD as cash grant. It did not cover all her losses, but she is optimistic that she can rebuild her humble business. “It has taken me over 12 years to establish the business I lost to the fire, but I can start again.”

 “It is the first time since the fire disaster that I managed to smile“, said Ibrahim Issaaq who also received a cash grant.  His biggest worry was how to pay his creditors. “Now with this amount I can take it to the suppliers and they will lend me shoes worth double the amount.’’

The Stability Fund and Danish Demining Group are committed to enabling the community-led Danwadaag initiative to continue to press ahead with its effort to bring long-term sustainable change, but without losing sight of unforeseen, immediate priorities that come with accidents and natural disasters.

Center for Education and Development

The Center for Education and Development (CED) is a Somali organization that has been working in Somalia since 1992. Based in Mogadishu, CED has branches in the various regions across Somalia.  The organization has promoted sustainable livelihoods through developing and implementing forward-thinking policies in education and community-led-development.

CED has an active and productive partnership with various stakeholders, including the Federal Government, community representatives, local authorities, private institutions and the youth. The organization is currently implementing the Community and Youth Based Economic Recovery and Stabilization (CYBERS) project in newly-liberated areas in Middle Shabelle region.

CYBERS aims to build practical capacity for the youth to generate incomes, centering on agricultural value chains and rural enterprise development skills. Individual skills development activities will be supplemented by provision of business development services, establishment of farming cooperatives and rehabilitation of key public infrastructure assets – canals, feeder roads, water wells and markets.

Through an innovative NGO-private sector collaboration with Somali Green Initiatives & Technology (SOMGIT), CED will support the implementation of SOMGIT’s lease-to-own drip irrigation scheme in the Middle Shabelle region. This enables CED to connect young people to new farming methods, whilst utilizing its close links with the local community to help Mogadishu-based SOMGIT establish trust with its future customers.

With a mix of immediate infrastructure rehabilitation work and farming skills development, the CYBERS program will create short-term employment whilst enhancing local capacity for longer-term, sustainable livelihoods and job creation. The program is also designed to engage youth in the upgrading of public infrastructure assets and in conflict resolution mechanisms to support stabilization and peace building in Middle Shabelle.

The Stability Fund is delighted to be working with CED to help communities in Middle Shabelle to rejuvenate public infrastructure and create new livelihoods via a youth-led development programme. The Fund is also working with CED to improve its financial and other risk management systems in order to assist the organization in attracting more direct funding from donors, instead of relying on sub-contracts from INGOs.

Somali Green Initiatives & Technology

Somali Green Initiatives & Technology (SOMGIT) is a private company based in Mogadishu, Somalia. Founded by Somali professionals, SOMGIT provides innovative drip irrigation systems, greenhouse farming solutions, agro-inputs, and marketing services to farmers in South Central Somalia.

Somali farmers, especially those without access to the traditional flood irrigation systems, rely  on rain-fed agriculture thereby limiting crop production to the rainy season. A delay or lack of rain means potential crop failure.

Access to efficient and reliable irrigation can bring about a step-change in agricultural production and income generation. It provides the farmers with a second cropping season, or even year-round production, liberating farmers from the vagaries of the rainy season. Furthermore, farmers are able to cultivate fruits, vegetables, and other higher-value crops that require consistent water supply. Drip irrigation systems also deliver nutrients, as well as water, directly to the individual plant, reducing the growth of weeds nearby.

SOMGIT’s agro solutions, which include solar-powered water pumps, provide a proven water-conserving, energy-saving and cost-effective system. For example, SOMGIT’s approach yields water savings of over 80% compared to traditional surface irrigation systems.

SOMGIT also has the capacity to develop water resource supplies to farmers, including the drilling of boreholes and development of ponds for farmers to store and channel water. With a reliable water supply in place, SOMGIT delivers drip irrigation equipment, high-quality seeds, fertilizers, and other inputs together with agronomical training and guidance on all aspects of planting, input application, and other farm functions. All equipment and agro-inputs are supplied to the farmers up-front and are subsequently paid for from crop revenues in accordance with a Sharia-compliant lease-to-own scheme.

The Stability Fund is proud to be a partner of innovative Somali businesses like SOMGIT and, in addition to our financial investment, we are providing technical assistance to strengthen its internal financial and management systems in order to prepare the company for future rounds of funding from new investors.

Drop the gun, pick up the coffee

Libah-Har village stands alone in the desert, speckled with tiny huts made from sticks, mud and plant fibre. Goats, camels and sheep graze on dry, brown grass. Life in Libah-Har is confined and entirely dependent on livestock. It does not have a secondary school, healthcare center and other basic human needs to educate nor heal its more than 500 residents. Resources are scarce and conflict over land, water and charcoal continues to destabilize the entire region.

Over 60% of Libah-Har’s population are youths desperate for education and opportunity. Unemployed youths affected by the protracted violent conflict often fall into a life of crime, and those that don’t get involved in crime stay hopeless at home.

Abdiweli was armed as a child. After finishing primary school he turned to crime, working as a footsoldier at illegal checkpoints in Qardho district, northeast Puntland. Recognising an urgent need to give disconnected Somali youth economic opportunities , just over 1,000 youth were engaged through local partner. Of these, more than 800 have received vocational training, with the top performing students receiving small grants to start micro-enterprises and a further 400 participating in an internship programme with small businesses in Puntland.

Abdiweli was one of the recipients, he was offered a grant to start a coffee and confectionary shop. Over 60 people buy coffee from his shop each evening. He is now focused on making his business a success, where he has now enrolled in school to learn business management skills.  With the youth unemployment rate in Somalia amongst the highest in the world, what the youth here lack are investment, resources and opportunity. As Abdiweli proves, an investment targeting youths can go a long way in supporting peace and stability in Somalia.

The Stability Fund, working with CESVI, appreciates the opportunity given by the residents of Libah-Har to work with the youth in the local area to create jobs and businesses. The initiative was recently extended to support additional follow-up activities to help translate skills development into real employment.