Somalia's Main Business Sectors
As is the case with most of its neighboring countries, the economy of Somalia is supported with both modern and traditional industries. However, more modern manufacturing techniques are gradually taking hold. According to Somalia's Central Bank, almost 80% of Somalis are either semi or entirely nomadic, herding camels, cattle, goats and sheep. Here, you will learn about some of the sectors in the still-developing Somali economy.
By far, agriculture is the most important Somali business sector. It comprises about sixty-five percent of the country's GDP and employs an equal amount of the work force. The farming of livestock contributes about forty percent to the GDP and makes up about half of all export earnings. Other agricultural exports are bananas, charcoal and fish; corn, sorghum and sugar are made for the domestic market. The industrial sector is largely an offshoot of the agricultural sector, accounting for 10% of Somalia's GDP.
Imports and Exports
According to the Central Bank, imported goods total about $460 million per year, and exports total nearly $270 million per year. Both imports and exports have surpassed pre-war levels, but have led to a trade deficit of over $190 million per year. Some of the deficit is made up by remittances from Somalis living in the diaspora.
Before civil war broke out in 1991, there were fifty-three manufacturing firms in Somalia, and all were state-owned. However, the conflict destroyed most of the country's manufacturing sector. Due to investments made by Somalia's diaspora, many of these industrial plants have been reopened, and new ones have been built. Manufacturing in Somalia includes fish canning, meat processing, pasta, candy, bottled water, soap, pillows and mattresses, and fishing boats. Investments in manufacturing are increasing in cities such as Mogadishu, Hargeisa and Bosaso.
Somalia is home to some of the most competitively priced internet and telephone services in the world. After the civil war began, telecom companies began to appear, competing to be the first to provide the infrastructure that was missing. These companies are funded by Somali investors and backed by experts from Europe, China and Korea, and they offer mobile phone and internet service that isn't available in many other parts of the area.
After partnering up with companies such as ITT, Telenor and Sprint, these companies now offer the best phone service in Africa. For every 1000 people, there are about 25 telephones, and the availability of phones is much higher than in neighboring countries. Somalia's telecom companies are rivals, but several of them signed an agreement allowing them to expand their networks, set prices and keep the competition fair.
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