The Hoped-For Economic Bonanza Could Become a Curse..... The looting of Somali resources has begun in earnest, this time not on its coast for fish, but on its land, also located in the East African region. Since Somalia has remained one of Africa’s poorest countries for decades, many Somalis heaved a deep sigh of relief when the government recently announced that the country is now peaceful and open for business. In my opinion, however, oil companies are not now “discovering” oil anywhere in East Africa, but simply exploiting the oil belt that runs along the entire coast of the southern and northern regions that has been known about for decades. In earlier years, oil executives didn’t care about building rigs in Somalia and thereby contributing to peace in the country. They were too busy trying to gain control over the unstable conditions in the Middle East. Today, the Somali people should not be deceived about the prospect of dramatic benefits from new oil wells. Yesterday, there was illegal fishing on our coast, and, now, the oil scavengers and neighboring countries and their governments, respectively, are again looming over it. If we are not careful to regulate and choose rightly between the Sudanese, Nigerian, and Ghanaian models of exploitation, there will be no real benefit from all the new oil drilling. In the long run, this apparent economic bonanza could definitely turn out to be a curse for the Somali people. It is understandable that, given the current political stability and recent oil finds, Somalis all over the world, like many other native Africans, are gripped by the expectation that oil and gas exploration “will bring” prosperity to their country. It is undoubtedly true that, if the opportunitiesthat accompany exploitation of the “black gold” are well managed, they could transform Somalia for generations to come. This prospect of a major upgrade in living conditions from 2016 on has raised the hopes and aspirations of many in the country.Unfortunately, these aspirations may turn out to be a nightmare, if the government allows every region in the country to independently sign a contract with oil corporations and their governments. Things can also go bad if the people and Parliament do not rise up and demand that the Somali government take some time to adequately scrutinize any oil “agreement” it reaches. The government should also set up a national platform for a dialog on the best way forward. This must be aimed at securing a reasonable percentage share (70% and above) of oil proceeds for the people, whose interest the government claims to serve. According to a recent statement issued by the UK Ambassador Matt Baugh, the chances of reaching agreement remain “very, very fragile.” Rival regional administrations have issued several companies rights to a clutch of overlapping oil blocks, redrawing the political map of Somalia in line with their own interests. On an international level, disagreement between Kenya and Somalia over their maritime boundary has also created what one diplomat terms a “triangle of confusion” that reaches across 120,000 square kilometers. Kenyan troops defend the port of Kismayo, south of Mogadishu. This posture is notionally in support of the Mogadishu government, but Somali officials worry Kenya is actually keener on securing oil rights. Oil exploration commences with high hopes for economic transformation. So, why the rush to explore for oil without first putting adequate measures in place that can meet the challenges that may accompany oil exploration in the near future? Are there other reasons for rushing forward? Are President Hassan Shiikh Mohamud and regional governors considering early retirement in the coming months? Has the government considered buying or building local refineries to process the crude oil, or will Somalia follow the Nigerian model, by which raw crude is shipped to Europe and the refined product shipped back to Nigeria at ridiculous prices? Has the government considered training local engineers to take over the management of the oil industry within the shortest possible time? Why must Somali leaders always allow sensitive sectors of their economy to be held hostage by a few foreign corporations?
Posted on: Sun, 23 Jun 2013 14:53:55 +0000
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