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Anarchy Somalia: The Rubble and the Blossom by Vince Vasquez
Go to the world's worst-run country, and
discover that what the government can't run,
prospers.
International media outlets reported this March
that rebel fighters in war-torn Somalia shot down a foreign military
helicopter in the nation's largest city, dragging the bodies of dead
soldiers through rotting streets with an air of jubilation. The scene
evoked memories of the United Nations' earlier, failed intervention in
the anarchic country, an intervention that resulted in the loss of 18
U.S. soldiers. Though many would conclude that little has changed in
this lawless land between 1993 and now, an economic blossom has emerged
from the national rubble with more peacemaking power than any military
mission or unanimous resolution passed on the floor of the Security
Council.
| | Vince Vasquez is the senior policy analyst
with the San Diego Institute for Policy
Research. |
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Few corners of the world evoke more images of despair than Africa,
home of some of the most broken, poverty-stricken nations on the planet.
Chief among those is Somalia, a country of more than 8 million people
that has lacked a functioning central government for over a decade and
is beset with one of the highest infant mortality rates in the region.
But it wasn't always that way. Freed from its European colonial
overseers, the United Kingdom and Italy, in July 1960, Somalia had a
promising start as a fledgling democracy. But a brief glimmer of fair
elections and individual freedoms came to an end in 1969, when a
military coup installed General Mohamed Siad Barre as president, in
charge of a Soviet-style Marxist regime. Practicing what he described as
"scientific socialism," Barre coerced a nation of nomads and herdsmen
into the new direction of large-scale public projects. During the next
two decades his regime nationalized industries, jailed thousands of
dissidents, and stifled free speech. The human costs of his boldly
statist objectives were egregiously high. As Amnesty International noted
in a 1988 report, "Human rights have been persistently violated in
Somalia ever since 1969 when the present government assumed power. The
evidence reveals a consistent pattern of torture, lengthy and often
arbitrary detention of suspected political opponents of the government
and unfair trials." As for the regime's effect on the economy, a
good example was what happened to the telecommunications industry. What
little telecommunications infrastructure was laid in Somalia during its
colonial and democratic periods was quickly seized by Barre. The entire
industry was reorganized under a single, state-owned monopoly,
administered by the newly fashioned Ministry of Post and
Telecommunications. It is estimated that the Ministry inherited a small
telegram system and an overworked telephone network of roughly 7,000
land lines, almost all of which were in Mogadishu, the country's capital
and home to more than a million people. By the end of Barre's rule in
1991, government bureaucrats managed to do little more than double the
number of land lines, accomplishing this only through the expertise and
resources of generous foreign powers. Following a "master plan" drafted
by UN technocrats to modernize Somalia's telecom infrastructure, more
than $60 million in projects were completed in the 1980s with an amalgam
of loans, grants, and technical assistance from Japan, France, Italy,
the Arab Development Fund, and the African Development Bank.
Even poor nations can embrace public policies that retain and augment a
skilled workforce, create a consumer market, and encourage indigenous
entrepreneurship and investment, thereby reducing the need for
international handouts. But the practical experience of socialist
systems throughout history has been that personal communication is
perceived as a threat that must be placed under tight government
control, so as to isolate and maintain power over people and markets,
and promote the unfeasible goals of bureaucrats and the dictators they
obey. Having eliminated incentives for private-sector investment and
curbed the individual liberties of the populace, Somali officials had to
depend on the goodwill of public leaders from more open, capitalist
countries.
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| The reason for
this astonishing success? No
government. |
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With no small businesses to speak of, and most citizens living on
measly government wages, unable to afford the high rates of a phone
call, the new-and-improved telecom network was a worthless edifice that
served no one, a testament to the failures of state-controlled
economies. Not surprisingly, the nation's phone network continued to
decay even after additional upgrades. A newly installed President Barre
proclaimed that Somalia had "broken the chain of a consumer economy
based on imports" by breaking away from democracy, and that under
socialism, the people would be "free to decide [their] destiny." The
effects of his plan were evident. But after more than 20 years of
dictatorship, the East Africans finally did take their future into their
own hands. Somali rebels, tired of Barre's costly military
misadventures and human rights abuses, took up arms against the
increasingly totalitarian government, overthrowing the dictator in 1991.
A low-level civil conflict in Somalia has continued until today,
replacing welfare statism with anarchy, as no aspiring faction has been
strong enough to gain control of the entire country. It has been an
unlovely and at times a horrifying spectacle. Because of the turmoil,
however, state monopolies and public works have made way for a
free-market economy and individual choice; and these, in turn, have
buoyed the nation from complete collapse. In addition, they have
fostered some innovative solutions to the problem of meeting human needs
in the vast, arid land. For telecom, the industry's rebirth had
to begin at ground zero. During the revolution that ousted Barre,
marauders stripped the nation clean of anything that could be sold,
including phone lines and other communications equipment. But starting
from scratch proved easier when bureaucrats weren't in the way to tax
and regulate business, directing the flow of investment for political
reasons. As The Economist noted in 1999, phone networks "are at
the heart of Somalia's survival and recovery." Phones allow Somalis to
stay in touch with their friends abroad and facilitate business deals
between roaming herdsmen and foreign meat markets. The millions of
Somalis who live outside the country send up to an estimated $1 billion
back to their homeland each year. Because Somalia is strategically
located on the Horn of Africa, at the mouth of the Red Sea and between
major African and Arab markets, some expatriates saw Somalia as a
lucrative business opportunity when the Barre government was overthrown.
With the financial and business support of foreign and domestic
investors, a new wave of entrepreneurs returned home to set up shop,
serve local needs, and build the country they always believed it was
possible to create. Today, after more than a decade of anarchy,
five major Somali-owned telephone companies, about a dozen mobile
companies, and at least three internet service providers serve markets
in Somalia, offering a range of top-notch products and affordable
service plans. In all, more than 100,000 land lines have been strung
throughout the country, half a million cellular phone subscriptions have
been sold, and 90,000 internet users access the Web in cafes across the
country. Marketplace competition keeps prices low and value high for
consumers. As the CIA World Factbook states, "telecommunications firms
provide wireless services in most major cities and offer the lowest
international call rates on the continent." Somalia has more robust
telecom investment and adoption than many of its neighbors —
according to 2004 figures from the World Bank, the nation bests stable
neighbors Ethiopia and Eritrea with regard to the number of phone lines,
mobile subscriptions, and internet users per thousand residents.
The reason for this astonishing success? No government. In the
absence of industry bureaucrats, there is no need to obtain an operating
license or a franchise to provide service; supply is free to meet
unbridled demand. There are no legacy rules or government-sanctioned
monopolies that would make investment unprofitable, or label certain
technologies or markets off-limits. Lacking government lawmakers to
create pork projects, mismanage funds, and engender budgetary
shortfalls, there are no industry taxes to nickel and dime companies to
death, nor any user fees or surcharges on consumer bills. Lacking duties
or customs officials, entrepreneurs can bring equipment cheaply through
private airstrips and ports, without the long delays or additional
business costs incurred in public facilities. As one telecom
entrepreneur put it, "The collapse of Somalia has been good for
business. In many ways it is much better off than before. Then we had
state monopolies and bureaucracy and corruption, and all the wealth was
in Mogadishu." And so far, the Somali telecom industry has
successfully kept itself in check, united by a common desire for growth
and profits. In 1998, local service providers came together to form the
Somali Telecom Association, a self-regulating body that collects sector
data, facilitates communication and business relationships, and offers
training and development in the war-torn nation. Three telephone
companies combined to set up the Global Internet Company, to administer
the deployment of common internet network infrastructure, and, according
to its website, provide services to startups and venture capitalists,
including graphic design, marketing, research, and business development.
In November 2005, five major phone companies voluntarily came to an
agreement and introduced interconnection services for customers,
allowing them to speak to one another across the various private
networks. Other companies have followed suit, penning similar agreements
with their rivals. Though anarchy has its benefits for some
risk-takers, it also has its shortcomings. Instability and security
concerns are persistent problems, as anyone with a gun on the streets
can rob or kill, or hold businesses hostage in the marketplace. Yet,
even in the absence of the rule of law, or even a local banking system,
profit-making companies persist, and attempt to work out their problems.
Banking needs are handled in nearby Dubai or the United Arab Emirates,
where many of the larger telecom companies are headquartered, and
financial transactions are completed in dollars or euros. Mobile phone
subscriptions are prepaid, and some landline companies use calling
cards. Contracts can be enforced through the traditional clan system,
and security is maintained either by hiring private guards or by
contracting protection services from local warlords. Militias and gunmen
would be foolish to destroy cell towers or disable phone lines, unless
they wanted to be left without phone service themselves. Risks are very
high, costs are all incurred up front, and there aren't any insurance or
special government bailout programs if the political turmoil gets worse
and enterprises fail. But economic frontiers are tamed by the strong and
the brave, people who are willing to take risks for the chance to reap
rewards. Some may argue that the basis for telecom investment
and entrepreneurship didn't exist before the collapse of the Barre
regime. To be sure, satellite technology has dropped in price in the
last few years, and internet access and mobile phones didn't hit the
mass consumer markets until the mid-1990s, after Barre's overthrow. Even
before that time, however, a capitalist economy would have spurred the
adoption of additional service providers and alternate technologies,
such as coaxial cable, which has been used commercially to deliver voice
and video services since the 1940s. Lawmakers always have the option of
fostering marketplace competition, empowering companies and consumers to
chart an organic path of economic growth and capital investment.
| Socialist
systems perceive personal communication as a threat that must be placed
under tight government control, so as to isolate and maintain power over
people and markets. |
|
Recently, the international community has sought to set in place a
"new Somalia," but it's doubtful whether the plan serves the interests
of Somalis. A UN-backed transitional federal government (TFG) was
installed in Mogadishu in December 2006 after Ethiopian troops and TFG
supporters wrested Islamic rebels from their regional strongholds. But
Ethiopian troops, long reviled by Somalis recalling previous military
engagements, have since taken up residence in Somalia, serving as
foreign occupiers; and this has not gone over well, even with
pro-government Somalis. The Islamic radicals and other antigovernment
forces have gone underground, waging a guerrilla war in the streets of
Mogadishu that has claimed hundreds of lives. This is the conflict that
culminated in the bold attack on an Ethiopian helicopter that for many
in America was all too reminiscent of "Black Hawk Down." More
troubling are the initial acts of the TFG, which has tasted the same cup
of power from which President Barre once drank. Rather than take a fresh
approach to providing security and fighting the radicals, TFG officials
in early 2007 quickly called for everyday Somalis to surrender their
arms to the state, and even shut down news media outlets they felt were
"being biased" in their coverage of the conflict. Unfortunately for
Somalis, these actions seem to come more from Barre's old policy
playbook than the precepts of a democratic institution. In the
search for a lasting peace, heavy-handed foreign intervention and
artificial, big-government solutions are poor choices for securing the
loyalty of a tough, independent people that isn't likely to lay down
arms and pay federal taxes so that Mogadishu can become an African Paris
or San Francisco. Rather than continue efforts to impose foreign
occupiers and a strong centralized government, leaders in the
international community should put their energies into a bottom-up
approach that recognizes local control, the importance of the basic rule
of law, and the value of extending telecommunications across the nation.
A nation blanketed with information access and phone service can
enjoy greater trade, greater growth, and stronger human relationships,
both domestically and internationally. A vibrant communications backbone
will encourage greater foreign direct investment and participation of
expatriates in Somali society and the marketplace. In the absence of a
strong central government, local police and courts, financed by local
residents, can meet the needs of both businesses and the populace. If
Somalis can feel secure in their own country, and tend to the needs of
their families and their communities, they will be in a better position
to consider the prospects of greater regional and national peacemaking
efforts. In the end, peace in this ravaged land may be nothing
more than a phone call away, and pursuing that possibility may give
Somalis a better chance at a lasting armistice than any bureaucrat or
blue helmet could ever provide.
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