Bosaso (WDN) – Activity at Puntland’s main port in Bosaso has virtually stalled for nearly ten days following the government’s introduction of a new tax regime. According to business sources, the increases are as much as four times higher than previous rates—an increase they say is unsustainable.

Traders warn that if the policy remains unchanged, many importers may divert their shipments to other ports across Somalia, raising fears of a prolonged decline in cargo traffic through Bosaso.

The Port of Bosaso serves as the economic lifeline of Puntland and a critical trade gateway for much of central Somalia, facilitating the import of essential commodities including food, fuel, construction materials, and consumer goods—as well as the export of livestock, fisheries, and other locally produced products.

Its strategic location on the Gulf of Aden connects Somali markets to the Middle East, the Gulf states, and international shipping routes, generating substantial customs revenue, creating thousands of direct and indirect jobs, and supporting transportation, logistics, and commercial activities across the region.

Any significant disruption to Bosaso Port’s operations—whether caused by tax increase, insecurity, conflict, or infrastructure failure—would have severe economic consequences, including supply chain disruptions, shortages of essential goods, rising inflation and transportation costs, loss of government revenue, reduced investor confidence, and widespread impacts on businesses and livelihoods throughout Puntland and central Somalia. Such disruptions would also undermine humanitarian operations and regional trade, exacerbating economic hardship and social instability.

The disruption could  also deal a significant blow to Puntland’s economy and public finances. As customs revenue from Bosaso Port is the backbone of the regional government’s budget, a sustained drop in imports could sharply reduce state income, placing additional strain on public spending and essential government services.

WardheerNews