By Lisa Vives
NEW YORK, (IPS) – After twin suicide bombings at a popular Mogadishu hotel last week that killed 25 and wounded 40, news reporters were seen swarming through the city, spotlighting the victims, the assassins, the motives and the official response.
This left actor Barkhad Abdi, who played opposite Tom Hanks in the Captain Phillip and was making his first visit to Somalia since age seven, unlikely to have the usual paparazzi following his every move.
Yet Abdi, a Goodwill Ambassador for Adeso, a Kenya-based development charity, was there to bring attention to the plight of ordinary Somalis, facing life without a lifeline since the shutdown of money transfers that have been key in rebuilding Somali lives.
The money – over a quarter of a billion dollars from the U.S. alone – comes from families in the diaspora, the charity Oxfam America reports.
“The small amounts of money that members of the Somali diaspora send their loved ones comprise Somalia’s most important source of revenue,” wrote OxfamAmerica on its website. “Remittances to Somalia represent between 25 and 45 percent of its economy and are greater than humanitarian aid, development aid, and foreign direct investment combined.
“Remittances empower women and help give young men alternatives to fighting in armed groups. The money is the country’s lifeline.”
Because Somalia lacks a formal banking system, small companies were established, run by money transfer operators who could safely and legally deliver money to relatives and friends in Somalia. These companies used bank accounts to wire the money but most of those banks have shut down including the California-based Merchants Bank just last month.
According to the banks, around one percent of money transfer firms could not be properly investigated and pass due diligence checks by the federal currency control office. Yet this decision ignored the 99 percent of money transfer businesses which have been operating in this sector for decades.
Most money wired to Somalia originates in the U.S.
The move by Merchants Bank to pull the plug on the money transfer network could force law-abiding U.S.-based Somalis to choose between three options, according to Professor Laura Hammond of the UK School of Oriental and African Studies.
“They can stop sending money to their relatives living in the Horn of Africa. They can try to find alternative legal channels, but as a result are likely to be charged much higher transfer rates, reducing the amount of money their relatives receive. Or they can use unregulated and illegal ways to send money.”
Opinion writer George Monbiot put it more strongly. The U.S. Office of the Comptroller of the Currency, which triggered the bank closings, is, he charged: “The world’s most powerful terrorist recruiting sergeant… Its decision to cause a humanitarian catastrophe in one of the poorest, most troubled places on Earth could resonate around the world for decades.
“During the 2011 famine in Somalia, British Somalis saved hundreds of thousands of lives by remitting money … reaching family members before aid agencies could mobilise,” he wrote in The Guardian newspaper.
Read more: At the Margins of a Hot War
Source:IPS