African Press International (API)

"Daily Online News Channel".

Archive for July 5th, 2013

Cutting Somalia’s remittance “lifeline”

Posted by African Press International on July 5, 2013

Somalia’s economy depends on remittances from abroad

NAIROBI,  – By withdrawing banking services from more than 250 money-transfer companies, Britain’s Barclays Bank risks severing an essential lifeline for millions of people in Somalia who depend on remittances from relatives in the UK, warn humanitarians, rights activists and academics.

For most of the remittance firms, the move is set to come into effect on 10 July, although an extension of 30 days has been granted to some of the companies.

Barclays said there was a risk that some of the firms might be “unwittingly facilitating money laundering and terrorist financing”.

Companies set to have their Barclays accounts shut down – effectively ending their UK operations – include one of Africa’s largest remittance firms, Dahabshiil. While countries other than Somalia may also be affected, ongoing humanitarian challenges in the nation and the absence of a formal banking system there mean that Barclays’ decision could have devastating consequences.

“A huge number of Somalis rely on remittances, which are estimated to be as much as US$1.2 billion every year – more than the entire humanitarian operation in the country,” Philippe Lazzarini, the UN’s top humanitarian official in Somalia, told IRIN. “It is not an overstatement to say this move will cut a lifeline for essential services in Somalia.”

Humanitarian fall-out

An “urgent appeal” to British Prime Minister David Cameron, issued on 1 July by 185 Somali civil society groups, said the move was likely to have “dire consequences” in Somalia “where no alternatives to the money service businesses exist.”

“We are seriously worried that without the services of these money transfer organizations, Somalis living in the diaspora throughout the UK… will not be able to send desperately needed support home to their relatives. This will have immediate and severe humanitarian implications,” the appeal added.

Four leading international aid and development NGOs have this week written privately to Barclays asking the bank to reconsider its decision, warning of significant humanitarian fall-out.

According to Senait Gebregziabher, Somalia country director at Oxfam and one of the signatories of the letter to Barclays, stopping the transfers would see many more Somali families “fall back into crisis”. Somalia is still recovering from a famine that killed some 260,000 people in 2011.

A report soon to be published by the NGOs Oxfam and Adeso estimates that members of the Somali diaspora in the UK send over 100 million pounds ($152.5 million) to Somalia every year.

These remittances are reportedly second in total value only to those sent back from the US.

Far-reaching effects

The NGOs’ research suggests that remittances account for around 60 percent of the recipients’ annual income, with money mostly being used to cover basic household expenses.

Mogadishu resident Halima Mohamed and her family depend entirely on financial support sent through money-transfer firms by her two sons in Britain and Denmark.

“My sons send $300 dollars each month, which we use to cover our basic needs like food, water and rent. Three of my children are at school, while one attends university, and we’ll find it hard to cope with the situation if Barclays proceeds with its decision,” she told IRIN.

Remittance firms serving Somalia have developed systems that help them operate in a country with no formal banking infrastructure. Using bank transfers where possible, the firms also use non-bank financial transfers based on trust and social solidarity, commonly known as ‘hawala’, meaning “transfer”. This system has become vital both for the delivery of support to families for business development. Aid groups rely on these systems as well.

Remittances account for more than a billion dollars every year

“While this suspension will not affect our local transfers, it is worth noting that the UN and many of the large relief and development organizations use hawala money transfers to pay their staff, procure assistance, and implement very successful emergency aid and poverty-relief programs such as cash-for-work,” the UN’s Dawn Blalock Goodwin told IRIN.

Liability

For Barclays, the question is one of compliance with international financial regulation and potential risk to the firm – both in terms of reputation and possible legal penalties from the US and other jurisdictions.

“As a global bank, we must comply with the rules and regulations in all the jurisdictions in which we operate. The risk of financial crime is an important regulatory concern, and we take our responsibilities in relation to this very seriously,” said Daniel Hunter, spokesperson for Barclays.

“It is recognized that some money service businesses don’t have the proper checks in place to spot criminal activity and could unwittingly be facilitating money laundering and terrorist financing.”

“Abuse of their services can have significant negative consequences for society and for us as their bank. We remain happy to serve companies who have strong anti-financial crime controls, but are asking the others to find another bank. This is solely about the company’s controls, not where they send money to,” he added.

The Barclays decision follows HSBC’s payment last December of a record $1.9 billion fine to settle accusations from US prosecutors that it had failed to implement anti-money laundering controls and allowed terrorists to move money around the financial system. The UK’s financial regulator also warned British banks on 1 July that they were not doing enough to protect against financial crime, saying they could face punishment for failing to spot abuses such as sanctions violations or terrorist funding.

In 2011, two Somali women in Minnesota were convicted of funnelling money to Al-Shabab militants using hawala brokers, and a Somali website, Sunatimes, has made allegations linking Dahabshiil to the Somali Islamists. Dahabshiil strenuously denies the claims and is taking the Somali journalist who runs the website to court.

Moving underground

But some argue the move by Barclays will shift legitimate transfers to murkier channels.

More than 100 academics and aid practitioners wrote to the British government last week to protest Barclays decision, warning that closing down money transfer channels “will only encourage people to send funds through illegal, unsafe, and untraceable channels, thereby potentially making the problem of support to proscribed parties much more serious”.

The view from Dadaab
While the threat to remittance flows into Somalia has provoked the greatest outcry, there is also concern about the impact on Somali refugees in neighbouring Kenya.

According to hawala companies operating in the 20-year-old Dadaab camp, which houses two-thirds of Kenya’s 500,000-strong Somali refugee population, more than a third of camp residents depend on remittances sent from abroad.

“What we receive from aid agencies is not enough, so if these remittances are closed or scaled down, our main source of support will be cut off,” Fatuma Mohamed Ali, a mother of eight who receives money from her relatives in the UK and Denmark, told IRIN. “I started a business with the money my daughter sent me.”

Refugees are not allowed to move out of the Dadaab complex, but many manage to run thriving businesses in the camp by using remittance money to contract people to buy goods for them in Garissa, Nairobi and Mombasa.

A Dahabshiil official, who did not want to be named, said: “In addition to the refugees, some of the aid agencies operating in Dadaab use our services, as the security situation make it difficult for them to carry cash around. Every month, we pay salaries to hundreds of staff as well as transfer other money to pay for agency operations. As you can, these hawala firms are a lifeline for the Dadaab camps.”

“We are regulated by the UK government. We are a licensed institution as is any other legal company,” Abdirashid Duale, CEO of Dahabshiil, told IRIN.

“Dahabshiil’s anti-financial crime controls are fully compliant with all applicable legal requirements and industry best practice and have been regularly audited by HMRC [the UK’s customs and tax department] for a number of years (on behalf of the FSA [Financial Services Authority]), without any adverse findings.”

“There is no other bank willing to open an account for us in the UK,” Omar Abdinur, managing director of Tawakal UK, another remittance firm affected by the decision, told IRIN.  “We have approached many banks but they are not willing. They say that money transfer is a risky business, but there is no single case in the UK where it has been proved that our firms are under-regulated or that we have transferred money to people under sanctions.”

Government response

Somali President Hassan Sheikh Mohamud has also called on Barclays to reverse its decision, stressing that the country is at a turning point “after two decades of chaos”.

“We understand Barclays’ corporate responsibility and its duty to its global customers to maintain a reputation for tackling financial crime, but that does not have to mean pulling the rug from under the feet of people battling extreme poverty – and before our fledgling government can step in to help,” he said in a statement last week.

Though faltering in its recovery – with some 10 percent of its population still reliant on humanitarian aid and violence ongoing in parts of the country – Somalia is seen as taking some steps in the right direction, a transition in which the UK is playing a key role.

In May, UK Prime Minister David Cameron, with President Hassan, hosted the second London Conference on Somalia, at which international donors pledged some $300 million in assistance.

But remittance flows to Somalia remain the country’s highest foreign exchange earner, and are a vital revenue stream. Any drop in remittances would throttle signs of economic recovery, analysts say.

“Somalia is almost entirely dependent on remittances, and if the closures come into effect, this could cause a humanitarian crisis as well as economic stagnation,” Somali economist Professor Yahye Amir told IRIN.

Extending the central bank’s reach and introducing banking regulation are among the government’s many priorities. Normal bank transfers, such as SWIFT, are not currently possible.

“Because Somalia’s crisis has been so prolonged, families have little ability to absorb shocks such as floods, droughts, disease outbreaks, displacement, a poor harvest or, in this case, an economic shock,” said the UN’s Lazzarini.

“The key thing to realize is that when humanitarian needs are assessed, remittances are already factored in. So a withdrawal or disruption of remittances will likely increase the number of vulnerable households or, for already vulnerable families, increase their need for humanitarian aid,” he said.

“With no formal banking systems as an alternative, we know from our experience on the ground that if remittances from the UK to Somalia were to be halted, many more families would fall back into crisis.”

The UK’s Foreign and Commonwealth Office (FCO) noted in a statement the “important role” played by remittances “in supporting the economy and people of Somalia”. But an FCO spokesperson also said that “Barclays’ decision is ultimately a private commercial matter”.

zf/am/rz source http://www.irinnews.org

Posted in AA > News and News analysis | Tagged: , , , , , , , | Leave a Comment »

Humanitarian needs rising

Posted by African Press International on July 5, 2013

Malian refugees in Damba camp, Burkina Faso (file photo)

DAKAR, 4 July 2013 (IRIN) – Humanitarian agencies have revised upwards their appeal to help Sahelians affected by hunger, malnutrition, impoverishment and conflict to US$1.7 billion, said UN Regional Humanitarian Coordinator for the Sahel Robert Piper.

“The Sahel is always in crisis mode,” Piper told journalists at a Dakar press conference.

Some 11.3 million Sahelians are estimated to be short of food this year and 1.5 million under-fives acutely malnourished.

As of May 2013, 345,000 acutely malnourished children had been treated in UN Children’s Fund (UNICEF) and NGO-run nutrition centres. But despite year-on-year nutrition support, surveys show malnutrition rates of over 10 percent in almost all of the countries, and above the 15 percent threshold in parts of Chad, Mauritania and Niger.

In Mauritania one third of the population is food-insecure.

Most vulnerable are families who were affected by the 2012 drought, and who have not yet recovered their animal or seed stocks, and the half a million Malians displaced by conflict in the north. But even Mali – the most “visible and acute” crisis in the region, with 3.5 million people estimated to be food-insecure – has received just 29 percent of the funding called for.

Just 35 percent of the amount needed – US$607 million – has been received thus far, leaving a US$1 billion shortfall. The funds received are unevenly spread, said Piper. “We recognize the response that has been given, but we are concerned that it is not equally spread across all sectors.”

Agriculture is just 23 percent funded, meaning it is already too late to get the necessary seeds to farmers to plant in time for the rains.

“We have missed a window of opportunity here to support agriculture and reduce the number of farmers in need of aid. We cannot distribute the seeds that are needed [for rain-fed agriculture] but there is still a lot that can be done,” said Piper, pointing to livestock vaccinations during the rainy season, getting animal fodder where it is needed, and getting seeds to farmers who plant on flood plains during the rainy season (the harvest is in late August).

Other severely under-funded sectors include water and sanitation (11 percent) and health (26 percent), both of which underpin infant nutrition; as well as education (10 percent), and early recovery (8 percent).

Most Malian refugee students living in camps are unable to go to school because of the lack of funds.

Interestingly, early recovery is not prioritized by donors (despite much talk of the need to boost resilience in the Sahel this year) to make vulnerable families less reliant on aid and more able to cope with harsh climatic conditions and endemic poverty.

aj/cb source http://www.irinnews.org

Posted in AA > News and News analysis | Tagged: , , , , , , , | Leave a Comment »

Justice and peace 10 years on in Liberia

Posted by African Press International on July 5, 2013

Liberian economy still limping along

MONROVIA,  – In December 1989 Charles Taylor crossed into Liberia from Côte d’Ivoire with a small group of fighters, sparking two brutal civil wars which would leave over 200,000 dead and over one million displaced. This August marks a decade since the end of that conflict.

The country is now at peace and has made some progress in infrastructure development – some neighbourhoods in the capital have access to electricity and 70 percent of Liberians have access to clean-ish water – but the reconciliation process has made little headway.

Liberia’s peace appears to stem instead from a deep-seated weariness of violence and the presence of a large UN peacekeeping force.

Have violence perpetrators been punished?

Four years ago, Liberia’s Truth and Reconciliation Commission (TRC) released a series of recommendations on measures for national reconciliation, justice and wide-ranging institutional reform to address the causes and consequences of the conflict. Yet until now little has been done to implement them, partly because some of those recommended for prosecution or disbarment from public office, including Nobel Laureate President Ellen Johnson Sirleaf, remain in positions of power and influence.

One of those recommended for prosecution, Prince Johnson, the senator for Nimba Country who finished in third place in the last presidential poll, stands accused by the report of “killing, extortion, massacre, destruction of property, forced recruitment, assault, abduction, torture & forced labor [and] rape”. The TRC also requests that he account for “the remains of the late President [Doe], especially the skull of the head of the President which was occasionally displayed by Hon. Johnson as a `war trophy’.”

James Yarsiah is the chairman of the Transitional Justice Working Group, a civil society initiative monitoring Liberia’s peace process. “I don’t want tomorrow another group of Liberians to crawl from the mountains and the bushes… because the guys who did it before are honourables and dignitaries now,” he told IRIN. “What kind of a message does that send?”

Suggestions of prosecutions have been met by the argument that attempting to prosecute those involved in the war might end up re-igniting it. But Yarsiah points to the success of the Special Tribunal for Sierra Leone in prosecuting “those who bear the greatest responsibility” for crimes committed in that country’s own conflict, without provoking a return to violence. Liberia also has the safeguard of around 8,000 UN peacekeepers to quell any unrest.

“The United Nations cannot condone impunity,” said the UN deputy special representative to the Secretary-General, Aneas Chuma. “There must be a moment of reckoning and accountability.”

In January 2011 Liberia’s Supreme Court ruled that the disbarment of any Liberian from public office without due process is unconstitutional, effectively nullifying that recommendation. “I don’t see anything happening [towards accountability] for the foreseeable future,” said Yarsiah – “not under this administration”.

A new body tasked with implementing TRC recommendations, the Independent National Human Rights Commission (INHRC), stands accused of political bias and a lack of experience in the field of human rights.

The commission’s acting head, Commissioner Boakai Dukuly, told IRIN that even though “there is no way you can have reconciliation, in the final analysis, without justice, sometimes you need a cooling off period after a conflict… Our situation is unique – the people who participated in the atrocities, a lot of them are in the government, they are in high places,” he said.

What role are Palava Huts supposed to play?

Not all the TRC recommendations are as controversial as the imperative to prosecute the warlords and bar figures from public office. A large part of the report is dedicated to promoting reconciliation, notably through the use of traditional Palava Huts, aimed at promoting community-level dialogue, a “quasi-judicial forum for justice and reconciliation”.

But these too, have been slow to make ground, amid confusion over their exact role. “Everyone’s saying ‘Great, but what is it?’” said Yarsiah.

The INHRC is tasked with implementing the Palava Hut system. “As we understand it here, [it] is really mediation, reconciliation, dialogue… an idea, not an edifice,” said Commissioner Dukuly.

It remains unclear exactly what powers the Huts will have, and how they will operate. If they are endowed with judicial powers, as insinuated in the TRC report, there is speculation they may face opposition from those already opposed to the establishment of the proposed Special Tribunal. If they are merely a forum for confession and forgiveness, are the perpetrators any more likely to confess and repent than they were during the initial hearings of the TRC, which were deemed a charade by many observers? At this stage it is still unclear when the Palava Hut system will gain ground.

Have any reparations been paid?

A third element of the TRC report called for a reparations programme of US$500 million. Despite much debate on the relative merits of “individual” and “community” reparations, this too has yet to be initiated, according to the Human Rights Commission. “The reparations programme is yet to be started,” said Dukuly. “To have reparations, the government has to put money in it,” he added.

One aspect of the TRC recommendations has, however, seen some recent progress, with the dedication of a memorial to two communities in Bong County where 500 people had been massacred during the second civil war (1999-2003). It is, according to the UN, “Liberia’s first memorialization of this kind”.

How flawed is the justice system?

Prominent among the institutional shortcomings often blamed for Liberia’s civil wars are a deeply flawed justice system, the over-centralization of power and wealth among Monrovia’s Americo-Liberian elite, widespread corruption,tensions over land rights and high levels of poverty and unemployment.

These problems largely persist.

The justice system remains inefficient and inaccessible for many Liberians. Power and wealth are still concentrated in the capital, Monrovia. Corruption remains widespread, as underscored by a recent audit report by accountancy firm Moore Stephens, which showed that only two of 68 land concessions since 2009 had been awarded in compliance with Liberian law. Land issues also remain highly contentious, with land tenure laws in need of reform, land grabs on the rise, persistent tensions between returning Liberians and those who stayed; as well as mounting tensions in towns and cities as urbanization mounts.

What about poverty and unemployment?

Above all, poverty and unemployment remain pervasive. For many Liberians, life has got little easier over the past decade, and price rises in basic commodities such as rice and fuel since 2008 mean life has become harder for many. According to the 2013 UN Human Development Report, 84 percent of Liberians continue to live below the poverty line.

The foreign direct investment poured into the country has not yet managed to significantly improve living standards of many ordinary Liberians. Liberia remains 174th out of 186 countries on the Human Development Index.

Rosaline Duaneh makes soup in a sandy alleyway in the maze of shanty dwellings that form West Point slum, near central Monrovia. She has been making soup here ever since the war. On a good day she makes up to 200 Liberian dollars (under US$3), with which she must care for her seven children. Rosaline says she is only able to send two of her children to school. “Life is hard for me”, she told IRIN. “I’m only just managing. It is just the same as before, but now there are no gunshots.”

“I have been here all my life” says her neighbour, 29-year-old Archie Ponpon. “There have been no changes, only the silence of the guns.” Archie, like many in West Point, complains of a chronic lack of jobs, even for high school graduates. According to a March 2013 report by the International Labour Organization, just 4.1 percent of Liberian youths have “stable” employment.

Are we now at a turning point?

But there are signs that now, 10 years after the signing of the Comprehensive Peace Agreement, some momentum is starting to take hold.

The government in December released “Vision 2030”, a wide-ranging policy document relating to security, rule of law, reconciliation and economic development which aims to make Liberia a middle-income country by 2030. President Johnson Sirleaf has earned praise for attracting billions of dollars in foreign investment to the country – despite the controversies surrounding many recent land deals – and has also won acclaim for writing off the vast majority of her country’s debt.

Though electricity and the transport network remain extremely underdeveloped, efforts are being made to change that. A World Bank project hopes to provide electricity to a further 80,000 Liberians while the government is aiming to fix the derelict hydro power plant at Mount Coffee by 2015. Power cables now reach West Point slum, for instance, though most residents cannot afford the tariff (43 US cents per kilowatt hour). Though tarmac roads remain rare outside the main urban centres, road rehabilitation projects are also ongoing.

Late last year the government unveiled a draft for a $50 million decentralization project aiming to devolve a certain level of power to the counties and lessen the current imbalance between Monrovia and the rest of the country. It lacks funding and would require constitutional amendments before it could be implemented, but it is a start.

Justice too is being decentralized. The UN’s Chuma points in particular to the first of five regional “Justice and Security Hubs”, which was launched this February in Gbarnga, Bong County. The hubs aim to make justice more accessible to residents of the interior of the country. And while the wider justice system remains far from flawless, it is slowly increasing its capacity to serve the population.

The security forces have undergone considerable reform, and the UN has now trained over 4,000 new police recruits. The UN Mission in Liberia (UNMIL) is aiming to reduce its troop count from around 8,000 to just under 4,000 by 2015.

And while land remains a highly contentious issue, in May the country’s Land Commission submitted a wide-ranging land rights policy which hopes to address some of the recent frictions.

“You don’t just build a state based on the rule of law just like that,” said Isabelle Abric of the UN Peacekeeping Mission in Liberia. “What I can really say is about the fact that there have been 10 years of peace, no matter what, and that means the first generation of children that went to school without war, and that’s what the country is building upon now.”

Last week the government launched a “Reconciliation Roadmap” which aims to streamline and coordinate the peace process. The document largely avoids the question of punitive justice for perpetrators of the war, but it does demonstrate the administration’s renewed efforts to face up to the challenges of the transition, providing a framework for the drive for peace and reconciliation.

“As Liberians, let’s seize this opportunity to reclaim our future,” announced Johnson Sirleaf at the unveiling of the Roadmap. Ten years after the end of the conflict, Liberia is at a turning point. It must take this opportunity to build on its recent progress if it is to consolidate the rocky foundations of its current peace.

tt/aj/cb source http://www.irinnews.org

Posted in AA > News and News analysis | Tagged: , , , , , , , | Leave a Comment »

 
%d bloggers like this: