The looming economic collapse in Somalia

[novanova]

Obviously, the Somali economy has been, over the years, standing on the edge of a financial abyss. But a combination of state-facilitated land seizures, irresponsible private bank credit asset investments and a weak regulatory environment has worsened the situation and created a ticking time bomb that could detonate into full-scale national bankruptcy at any time. As several opposition figures have painfully exposed, public deposits – money belonging to ordinary citizens – were diverted from private banks into the hands of the President, allegedly in exchange for state-owned land. This land, often forcefully taken from vulnerable communities, was then sold to private investors, particularly those with ties to the banking sector. The same banks, have plunged public deposits into luxury real estate construction projects across Mogadishu, hoping to sell them at high returns. But in doing so, they have not only tied up liquidity in a non-productive sector but also exposed Somalia’s financial infrastructure to catastrophic risk.

Full article: https://wardheernews.com/the-looming-economic-collapse-in-somalia/

 

[𐒁𐒚𐒒𐒂𐒘𐒂𐒗 𐒎𐒚𐒗𐒗𐒒]

The fact that Culusow and his goons don't have power beyond Mogadishu is a blessing in disguise. We should all thank Allah SWT that the country is not centralised, otherwise their theft would be apparent all over the country.

 

[Chaseyourdreamzz]

A lot of people would rather invest in Nairobi for this reason at least you’ll get a better return

 

[Dalac Bilaash]

Lol so now cleaning slums from the capital will lead to economic collapse who would've thought that would happen the opposition are basically sub 50 iq retards

 

[Gacmeey]

Wait, someone clarify something for me……

“public deposits – money belonging to ordinary citizens – were diverted from private banks into the hands of the President”

Are they saying money in EVC was taken by the president for his own agenda? Like the money on the phone is just pixels with no real value behind it?

 

[Basra]

Obviously, the Somali economy has been, over the years, standing on the edge of a financial abyss. But a combination of state-facilitated land seizures, irresponsible private bank credit asset investments and a weak regulatory environment has worsened the situation and created a ticking time bomb that could detonate into full-scale national bankruptcy at any time. As several opposition figures have painfully exposed, public deposits – money belonging to ordinary citizens – were diverted from private banks into the hands of the President, allegedly in exchange for state-owned land. This land, often forcefully taken from vulnerable communities, was then sold to private investors, particularly those with ties to the banking sector. The same banks, have plunged public deposits into luxury real estate construction projects across Mogadishu, hoping to sell them at high returns. But in doing so, they have not only tied up liquidity in a non-productive sector but also exposed Somalia’s financial infrastructure to catastrophic risk.

Full article: https://wardheernews.com/the-looming-economic-collapse-in-somalia/

Why r u talking like somalia is NOT a third world country?

 

[Barkhadle1520]

Obviously, the Somali economy has been, over the years, standing on the edge of a financial abyss. But a combination of state-facilitated land seizures, irresponsible private bank credit asset investments and a weak regulatory environment has worsened the situation and created a ticking time bomb that could detonate into full-scale national bankruptcy at any time. As several opposition figures have painfully exposed, public deposits – money belonging to ordinary citizens – were diverted from private banks into the hands of the President, allegedly in exchange for state-owned land. This land, often forcefully taken from vulnerable communities, was then sold to private investors, particularly those with ties to the banking sector. The same banks, have plunged public deposits into luxury real estate construction projects across Mogadishu, hoping to sell them at high returns. But in doing so, they have not only tied up liquidity in a non-productive sector but also exposed Somalia’s financial infrastructure to catastrophic risk.

Full article: https://wardheernews.com/the-looming-economic-collapse-in-somalia/

1. This is a well known biased lying Afar website

2. FGS bankrupcy doesn't mean econonic collapse

 

[Fit~Prince]

What economic collapse? There has to be an economy first for this to happen.

 

[Galguduudguy]

What economic collapse? There has to be an economy first for this to happen.

Wallahi these brudda’s keep talking like it’s a normal country. The Somali economy is separate to government. Only conflict stops these bruddas trading since they never relied on government economic policy to begin with

 

[Hotchick12]

the wheels keep turning businesses don’t rely on a nonexistent government to function

 

[Idilinaa]

Somali journalists , especially over at WardheerNews love pushing shallow takes. Like I said before, they’re big on gossip and light on actual research or professionalism.

No, Somalia isn’t on the verge of some “economic collapse,” and no, public land isn’t being sold off. Our commercial banks are community based, with built-in social accountability , if they mismanage funds, it’s not just bad for business, it’s socially devastating. They’re also not the ones bankrolling this. Yes, banks do fund some real estate in Mogadishu, but this isn’t like Western speculative bubbles where depositors’ money is gambled on risky bets.

Here, real estate projects are driven by demand since housing is short because of population growth, urban migration, and diaspora investment. Most builds are backed by pre sales or secured deals, so money isn’t just sitting there with no plan. And that “reckless private bank credit” line? Doesn’t apply. Somali banking isn’t a debt heavy mortgage machine like in the West , it’s Sharia compliant, conservative, and tied to community trust, so you don’t see banks taking on huge long term credit risks.

And real estate here isn’t “non-productive” either , it creates jobs, feeds supply chains (cement, steel, concrete, transport), and gives people collateral for other business ventures. At this stage of Somalia’s development, it’s actually one of the safest and most scalable investments out there.


As for the demolitions , most of the land being cleared is made up of informal settlements that popped up after millions were displaced into the city by the floods in 2023. They’ve caused overcrowding, safety hazards, and sanitation problems. Clearing them is part of the Mogadishu Development Corporation’s bigger plan to rebuild the city, making room for better urban planning, parks, waste management, and proper housing.

That said, Hassan Sheikh does deserve some blame. This should’ve been announced properly and discussed with the public first, with a clear plan for compensation. From what I can tell, that hasn’t happened yet.

 

[Espaa_]

Somali journalists , especially over at WardheerNews love pushing shallow takes. Like I said before, they’re big on gossip and light on actual research or professionalism.

No, Somalia isn’t on the verge of some “economic collapse,” and no, public land isn’t being sold off. Our commercial banks are community based, with built-in social accountability , if they mismanage funds, it’s not just bad for business, it’s socially devastating. They’re also not the ones bankrolling this. Yes, banks do fund some real estate in Mogadishu, but this isn’t like Western speculative bubbles where depositors’ money is gambled on risky bets.

Here, real estate projects are driven by demand since housing is short because of population growth, urban migration, and diaspora investment. Most builds are backed by pre sales or secured deals, so money isn’t just sitting there with no plan. And that “reckless private bank credit” line? Doesn’t apply. Somali banking isn’t a debt heavy mortgage machine like in the West , it’s Sharia compliant, conservative, and tied to community trust, so you don’t see banks taking on huge long term credit risks.

And real estate here isn’t “non-productive” either , it creates jobs, feeds supply chains (cement, steel, concrete, transport), and gives people collateral for other business ventures. At this stage of Somalia’s development, it’s actually one of the safest and most scalable investments out there.


As for the demolitions , most of the land being cleared is made up of informal settlements that popped up after millions were displaced into the city by the floods in 2023. They’ve caused overcrowding, safety hazards, and sanitation problems. Clearing them is part of the Mogadishu Development Corporation’s bigger plan to rebuild the city, making room for better urban planning, parks, waste management, and proper housing.

That said, Hassan Sheikh does deserve some blame. This should’ve been announced properly and discussed with the public first, with a clear plan for compensation. From what I can tell, that hasn’t happened yet.

Ever since u left this site its gone to shit soo noqo abaayo macaan everybody making up fake history now

 

[Idilinaa]

As for the demolitions , most of the land being cleared is made up of informal settlements that popped up after millions were displaced into the city by the floods in 2023. They’ve caused overcrowding, safety hazards, and sanitation problems. Clearing them is part of the Mogadishu Development Corporation’s bigger plan to rebuild the city, making room for better urban planning, parks, waste management, and proper housing.

That said, Hassan Sheikh does deserve some blame. This should’ve been announced properly and discussed with the public first, with a clear plan for compensation. From what I can tell, that hasn’t happened yet.

I shared this to some people privately. But i think i'll share it publicly to substantiate what i am saying.

After they clear out the informal settlements and some other buildings. They are going to build 410 new apartment blocks, 1,000 villas, and 2,000 low cost housing. Also 20,000 shelters.
They are improving land zoning, and creating spaces to expand sewage and drainage systems, roads etc.

It's part of a grander development plan to create a new Mogadishu with better urban planning and a cleaner , healthier city. They collected 3.5 billion dollars into an investment fund to finance it tied to a ''Development Corporation".

Somalia Unveils the Blueprint for a Modern and Sustainable Mogadishu

By Abbdiqani Abdullahi Mogadishu (SONNA): Somalia stands on the brink of a transformative era with the launch of the “New Mogadishu Project.” This ambitious initiative promises to reshape the capit…

sonna.so

This is how you know some Somali journalists thrive on gossip and sensationalist drama. A mere two minutes of research , just looking at the government’s publicly available plans would explain the reasoning behind the demolitions in Mogadishu. They’re being carried out for the collective good.

Instead, we get wild claims about selling public property to private businessmen, bank loans, and looming national bankruptcy. Not only is this baseless nonsense, but how do you even arrive at such conclusions without knowing the first thing about the facts? It’s a glimpse into a wider online mindset, quick to launch slanderous polemics without evidence.

It’s the same attitude I see on this website. Not everything is a hopeless doomsday scenario, and not everyone is a crook with nefarious motives. Plenty of good developments are happening all the time, driven by decent, kind people who help one another. In fact, it’s the local private sector and the Somali diaspora business community that are partnering with the government to move these development projects forward.

Ever since u left this site its gone to shit soo noqo abaayo macaan everybody making up fake history now

I’m thinking beyond just this site. I genuinely commend some accounts even on Twitter who put in the work and produce excellent research threads. I just wish more of them would focus on that and leave behind the trolling, personal biases, and petty beefs with each other.