Somalia thread for the week ending January 17

Sudan Tribune: Somalia signs currency printing agreement with Sudan

January 11, 2010 - A batch of new Somali currency will be printed in Sudan following an agreement signed in Khartoum today, Sudan state media reported.

The Managing Director of Sudan’s Currency Printing office Mohammed Al-Hassan Al-Bahi signed for Sudan Government while the Somali Finance Minister Sharif Hassan Sheikh signed for his government.

The cost of the printing process will top $17 million, SUNA reported

The Sudanese minister of Finance and national economy Awad Al-Jaz and the governor of Sudan’s Central Bank Saber Mohammed Al- Hassan were present at the ceremony.

Al-Jaz noted the “historical relations” between the two countries adding that the printing of the currency can contribute in realizing stability and development in Somalia. He said that Sudan’s experience in as a country emerging from conflict can be a good experience for Somalia.

The Somali minister hailed Sudan’s efforts in achieving peace saying that the presence of legal currency would contribute positively to the economy.

Somalia has been seeking Sudan’s help in rebuilding its government’s institution and security forces in a bid to assert control over the lawless country. The issue of currency was discussed during the visit of Sharif Hassan to Sudan last year.

Last April and May there were reports on this,

SUNA: Somalia signs currency printing agreement with Sudanese firm

Khartoum, 29 Apr (SUNA) - Dr Awad Ahmad al-Jaz, minister of finance and national economy, emphasized Sudan`s readiness to support Somalia in the construction and reconstruction phase after the end of the war, addressing of conflicts and utilizing of Sudanese experience in rebuilding what the war has destroyed for the benefit of Somalia. He said that Sudan gained experience in dealing with the aftermath of war, boycotts, and sieges and faced the repercussions through determination and tenacity.

During a meeting in his office on 29 April with Sharif Hasan Shaykh Adam, Somali finance minister and deputy prime minister, Dr Al-Jaz pledged to provide the experience and expertise necessary to build the financial institutions and the Central Bank of Somalia.

...

Dr al-Jaz expressed his hope that the agreement between Somalia and the Sudanese Currency Printing Press will culminate in the printing of Somali currency in Sudan.

The Somali finance minister revealed of a memorandum that was signed with the Sudanese Currency Printing Press. He noted Somalia`s interest in printing currency as, which is considered to be one of the most important reasons for establishing the foundations of real peace and stability in Somalia.

Garowe Online: Somalia govt to mint new currency, parliament demands approval

MOGADISHU, Somalia May 3 (Garowe Online) - Somalia's interim government has inked an agreement with the government of Sudan to mint new Somali Shillings, but a parliamentary leader has warned the government to bring a motion to parliament first, Radio Garowe reports.

Sudanese media reported Sunday that the Government of National Unity in Somalia has agreed with the Sudanese government to mint the new Somali Shillings.

Somali Finance Minister Sharif Hassan Sheikh Aden and his Sudanese counterpart, Mr. Awad Ahmed Jazz, signed the agreement in the Sudanese capital Khartoum last month, according to Sudan media reports.

...

The deputy Speaker of Somalia's parliament, Osman Elmi Boqorre, told reporters in the capital Mogadishu that the government cannot mint new currency without parliamentary approval.

"Nothing can be legal unless it is passed by the parliament," he said, adding that the Somali government must first submit a bill in parliament before it can enter agreements to print new currency.

Deputy Speaker Boqorre warned that the new currency might worsen the current state of the economy, which has been devastated by hyperinflation in recent months.

Parliament has been unable to meet for a number of reasons since they attempted to move back into Somalia from Djibouti.

Back to 2010,

Reuters: Somali money transfer firms used to fund war: c.banker

Somalia's central bank governor says rebel groups are using informal money transfers to fund their operations and that people in the war-torn country risk starvation if it is hit by Zimbabwe-style inflation.

Bashir Isse Ali told Reuters in an interview that al Shabaab -- which Washington considers as al Qaeda's proxy in the failed Horn of Africa state -- sends and receives funds via money transfer firms and urged more transparency to combat money laundering.

Quick question - do wire service reporters get a commission every time they stick the boilerplate "which Washington considers as al Qaeda's proxy" attribute onto any mention of Harakat al-Shabaab Mujahideen?

Anyway, essentially every transaction that takes place in Somalia is through decentralized systems, which drives central bankers crazy, apparently.

"Al Shabaab sends and receives money through this system using individuals, not as an organisation," Ali said. "Money transfer firms should know their customers and share information with authorities."

On inflation, the governor said Finance Minister Sharif Hassan Sheikh Aden planned to print money in Sudan and said this risked sparking runaway inflation that would cause people to starve.

...

..Ali said the finance minister plans to print notes with a face value of between 2,000 shillings and 50,000 shillings. Currently, the highest value note is for 1,000 shillings. (relatedly, see Brief history of the Somali currency.)

"This move will increase the inflation rate to incredible figures ... The country will be another Zimbabwe," he said, referring to that country's inflation peak of 500 billion percent in 2008, according to IMF figures.

"On one hand, the leaders cannot claim they are protecting people, and become part of a plot to kill them. If you shoot them or force them to starve to death, it is the same."

In 2000, 14,000 Somali shillings purchased a dollar, but the rate deteriorated to 45,000 in 2001 when the government printed more money, Ali said.

It has since appreciated to the current 33,000 shillings per dollar after note issue dried up when printing costs exceeded the value of the notes.

Ali said the central bank should manage the country's funds and not private companies contracted by government as is the case.

The United Nations Development Programme has managed donor money since the central bank's collapse in 1991 and charged 8-14 percent for its services, Ali said.

The government contracted PricewaterhouseCoopers (PWC) to take over the U.N. body's services in mid-2009.

"The only monetary agent for the government is the central bank. Therefore it is unconstitutional for private financial institutions to be involved in the management of government money," Ali said.

"Private companies can be employed as auditing firms, not management."

If not crazy, then maybe jealousy...

From a March 29, 2008 Reuters story,
Somali c.bank to overhaul currency, counter fakes

Somalia's embattled central bank plans to revamp the anarchic country's currency because of a flood of fake notes printed by warlords and businessmen.

Addressing donors meeting in neighbouring Kenya on Saturday, the bank's director general, Sharif Mohamed Hassan, said "greedy" individuals had pumped counterfeit cash into the market for years, driving the local unit to its lowest ever level.

...

He said Somalia's new bank notes would be produced by a "world renowned" money printer, but did not give a timetable.

The central bank would decide at what rate they will be exchanged for the old bills, he told the meeting, which was organised by the United Nations and the World Bank.

Inner City Press has a blog post Thursday on the currency story, and more

As Somalia's TFG Prints Bills, UN Accused of Shipping Tanks, Denial by Ould Abdallah

Somalia's Transitional Federal Government, in control of just a small part of Mogadishu, is contracting with Sudan to print new Somali shillings, UN envoy Ahmedou Ould Abdallah acknowledged to Inner City Press on Thursday.

Ould Abdallah had just told the UN Security Council that it should further back the TFG. Inner City Press asked about opposition by Somali MPs to the TFG's finance minister Sharif Shaykh Hasan Shaykh Adan cutting a deal with Sudan. Ould Abdallah said that new shillings were needed, because the previous bill were counterfeited, on "photocopy machines" and otherwise.

From the December 2008 Report on the Monitoring Group on Somalia, during the previous incarnation of the TFG,

197. The Ministry of Finance and Central Bank of Somalia are supposed to be pivotal in the direction of government revenue collection, but the two institutions appear to exist in name only. As a result, parallel revenue collection and appropriation structures have emerged, under the control of powerful Transitional Federal Government officials or allies.

198. For example, a senior official of the Central Bank of Somalia interviewed by the Monitoring Group stated that a printing press for Somali shillings, with no links to the Central Bank, is kept at the compound of the President of the [TFG] -- a claim that the Monitoring Group has heard independently corroborated by several sources. He further asserted that printing of Somali currency is also conducted by private businessmen, including some linked to armed opposition groups. The Monitoring Group has been able to verify the latter claim, with the assistance of [TFG] security officials.

199. Investigations by the Monitoring Group indicated that management of the Mogadishu Port has been effectively "privatized." Numerous independent eyewitness accounts provided by Government officials, civil servants and businessmen have confirmed that port revenues are controlled, without oversight, by two individuals -- one from the port administration and one from the Ministry of Finance, who then disburse funds on a discretionary basis. The two men are reportedly shielded from interference by a senior police officer.

From a September report at Garowe Online
Somalia MPs accuse Finance Minister of corruption

A group of lawmakers in Somalia have publicly criticized the Horn of Africa country's finance minister, accusing him of mismanaging public funds and taking steps to "destroy" the interim government, Radio Garowe reports.

The group of lawmakers included: MP Abdullahi Ahmed Afrah, MP Farah Ali Abdi, MP Mohamed Ali Omar, MP Ali Yusuf Osman, MP Dahir Abdulkadir Muse, and MP Shukri Haji Ahmed.

MP Afrah, who spoke at a Saturday press conference in Mogadishu on behalf of the lawmakers, said Finance Minister Sharif Hassan Sheikh Aden has taken steps to destroy the Transitional Federal Government (TFG) led by President Sheikh Sharif Ahmed.

"The Finance Minister illegally misuses the small income collected at the port and airport in Mogadishu," said MP Afrah, who is a member of the TFG parliament's financial accountability subcommittee.

Further, the lawmakers accused the Finance Minister of "directly mismanaging donor funds," particularly financial donations from Arab countries that support the TFG in Mogadishu.

"Government funds are not deposited at the Central Bank and there is no paper trail for accountability purposes," MP Afrah added.

The group of lawmakers said Finance Minister Sharif Hassan has not presented the 2009 budget to the TFG parliament.

"Sharif Hassan is currently leading an illegal process to mint Somali Shillings without parliament approval, which will have a negative impact on our [Somali] economy," MP Afrah said.

Further, the Somali MPs accused the country's Finance Minister of entering into a controversial agreement with Kenya, whereby imported products from Kenya are taxed in Nairobi before arriving in parts of south-central Somalia.

According to the MPs, this scheme, which does not include imports to regional authorities in Somaliland and Puntland, is led by "relatives" of Finance Minister Sharif Hassan.

...

The written statement included a brief political history of Sharif Hassan since his rise in Somali national politics in 2004, when he was elected as the TFG parliament's first Speaker.

He later joined the Islamist opposition and rejoined the TFG again in 2008, when Sheikh Sharif's Islamist camp signed a peace deal with the TFG. He was appointed as Somalia's Minister of Finance when Sheikh Sharif became Somali President in January 2009 at the conclusion of UN-brokered talks in Djibouti.

A Garowe Online editorial from shortly thereafter noted that, in addition to the Finance Minister being "a shady character with intimate ties with Mogadishu's hated warlords",

In a recent trip to Saudi Arabia, President Sheikh Sharif was "questioned intensely" about the Finance Minister's powerful role in the Somali government. According to informed sources, Saudi government officials expressed serious concern with a recent statement issued by a number of Somali lawmakers, who accused Finance Minister Sharif Hassan of corruption and urged Arab countries not to give him donor funds. The Finance Minister, the sources added, suggested that a rival group of Somali MPs be "bribed" to issue a press statement to counter allegations of corruption against him.

At the moment, the wikipedia entry for Sharif Hassan states that

sharif Hassan is well known business man of narcotic drug known as " Qat" and recently IT pointed out that he is one of worst embezzler of AID funds, he profited as Minister of Finance. He owns Million dollar houses in Kenya and USA.

Whatever counter-PR campaign he may have dreamed of, there's no sign that it ever materialized.

Continuing with the Inner City Press article,

Inner City Press asked how wide or small an area these new bills would be used it (sic). Ould Abdallah claimed all over the country, but for the dollarization of the economy. But with Al-Shabaab controlling whole swaths of Southern Somalia, one wonders if this currency contract is even practical.

...or perhaps another scheme to control and thus profit from a replacement currency. For instance, as it was in 2008 at the time of the Monitoring Group report, the Mogadishu Port is still one of the few areas protected by the foreign fighters of AMISOM, "effectively privatized" and controlled by the Finance Minister.

And, speaking of that port, as the Inner City Press post continues,

With the European Union bragging about escorting from Kenya to Mogadishu a ship chartered by the UN's UNSOA, and reports that the ship contained arms and tanks for the TFG, Inner City Press asked Ould Abdallah about it.

For the record, it has been reported that

[T]he TFG had imported a large shipment of arms, including tanks—the latter representing a considerable escalation from the "technicals," improvised battle wagons constructed by mounting a machine or anti-aircraft gun on a pickup truck or four-wheel drive vehicle, which have been ubiquitous in the Somali conflict. It later emerged that the shipment came on Sierra Leonean-flagged vessel, the MV Alpha Kirawira, which, according to a press release by the European Union Naval Force (EU NAVFOR) Somalia's Operation Atalanta, was chartered by the UN Support Office for AMISOM (UNSOA) and escorted out of the Kenyan port of Mombasa by the Spanish frigate SPS Navarra and accompanied all the way to Mogadishu by the French corvette FS Commandant L'Herminier.

Ould Abdallah said he hadn't heard of the ship, then added that heavy equipment is needed in Somalia, including APCs. His spokeswoman urged him to leave the stakeout, again without herself agreeing to provide any answers.

Ould Abdallah, as he left, said he would look into the ship. His deputy, who previously a serious humanitarian, seemed to indicate the same. We'll see.

Ould Abdallah sure does get away with a lot of lies. As pointed out in last week's thread, the arrival of that ship at the port specifically triggered another round of shellings and dead civilians. If he wasn't aware of that, he'd be completely left open to charges of incompetence.

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Back to the benjamins...

If the Arabs are hedging -- and why wouldn't they after the millions that the previous TFG administration pocketed -- try the old masters:

AP: Italy to fund Somali government ministries

Italy will fund the operations of key ministries of the fragile Somali government battling a long-running Islamic insurgency, the Italian foreign minister said on Thursday.

Italy, a former colonial ruler of Somalia, also will train an anti-terrorism police unit and a coast guard, and pay the salaries of police officers, Italian Foreign Minister Franco Frattini told journalists, announcing what represents a major boost for Somali President Sheik Sharif Sheik Ahmed's government.

Italy is doing this because Ahmed's government "is the best option. We have no alternative but to support this government," Frattini said after daylong meetings in Nairobi with Ahmed and Kenyan leaders that centered on Somalia.

Frattini said Italy will fund the daily operations of Somalia's foreign affairs, finance and national security ministries. He did not say how much this will cost or give other details.

...

Under a U.N. Development Program-supervised plan, officers have been trained to form a Somali police force, but some have left because they are not paid regularly. An unknown number have joined the insurgents who offer regular pay.

Must be that remittance money, eh?

With visions of a cash inflow dancing round in their heads...

VOA: Somalia Cabinet Minister Hails Italy’s Financial Support

A Somali official has praised Italy’s show of commitment towards President Sheik Sharif Sheik Ahmed’s efforts to stabilize the country after years of insecurity.

Abdirahman Omar Osman, who is also the treasury minister, said Italy’s pledge to fund key ministries is a major boost to the government.

“We very welcome this and we have been expecting (it). It shows the Italian government’s commitment toward helping the institution of the Transitional Federal Government (TFG). As you know, the Transitional Federal Government has been faced with challenge against al-Shabab (which) is linked with Al-Qaeda. Without our institutions functioning properly, it will be very difficult to wipe out or to combat al-Shabab,” he said.

Italy pledged to fund daily operations of Somalia’s foreign ministry, finance and the national security ministries. It will also help train an anti-terrorism police unit and coast guard as well as pay the salaries of police officers.

...

Osman said the pledged funds will help rebuild Somalia’s broken institutions.

And is there a double meaning in this ambiguous headline?

Daily Nation (heavily plagiarising a Xinhua report): Italy offers to train Somali terror police

A special Italian security unit is set to train the Somali police force on counter-terrorism strategies.

According to Italian Foreign Minister Franco Frattini, the law enforcers will be trained in Kenya — if the Kenyan government okays the idea.

“We offered yesterday to President Sharif Ahmed (Somali President) to establish a robust anti-terror police unit, trained by the Italian Carabinieri,” he said shortly after a meeting with Ugandan President Yoweri Museveni in Kampala on Friday, Chinese news agency Xinhua said.

...

The deal is set to succeed since President Kibaki last week reassured that Kenya will continue providing technical and humanitarian support to Somalia.

...

Mr Frattini said there is need for international cooperation to address the Somalia problem because terrorist groups are using it as a transit route to Africa and the rest of the world.

“The problem is an international one, not a problem affecting Uganda, Kenya, Ethiopia or Somalia,” he said, noting that the international community cannot talk about terrorist groups without addressing destination countries like Somalia.

He said Italy will also train some officials of the Somali Coast Guard in stopping piracy in the Gulf of Aden.

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Mareeg Online: Somali Central Bank reopens after 18 years

Transitional Federal Government in Somalia has today reopened Somali Central Bank which became collapsed after Somali civil war erupted the beginning of 1991.

...

Speaking to the reporters at Mogadishu International Airport, Deputy prime minister of TFG in Somalia, Pro. Abdirahman Haji Aden ( Ibbi ) disclosed that Somali government – after a long struggle had been made- reinstated and Somali Central Bank back in business telling that Government economy was used to be passed through Somali remittance companies ; how ever, from today the Government has a governmental Bank which will help international donors to send through their pledged economy

"The economy offered to TFG used to be transited through different countries like Djibouti and Kenya but as everyone sees we have a central bank which donors can use to assist Transitional Federal Government in Somalia," said Deputy prime minister of TFG in Somalia, Pro. Abdirahman Haji Aden.

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Europolitics: New EU Mission to develop horn Africa coast guard

European Union defence experts are looking at proposals for an ESDP mission to offer support to the coast guards of nations around the Horn of Africa region in an effort to strengthen the battle against Somali pirates. The plan under consideration would involve a civilian mission to develop the coast guard forces of Yemen, Djibouti and Kenya as well as Somalia itself..

If the plan is adopted, it would complement the EUNAVFOR Atalanta naval mission launched by the EU in December 2008 and the planned EU training mission for Somali security forces, details of which are currently being finalised within the EU's Political and Security Committee.

...

Planning is well underway for the training mission for Somali forces, which has been given the name EUTRA Somalia. However, the plans have yet to be approved due to continued concerns, notably from the Netherlands and Britain, about how the loyalty of soldiers to the Somali government can be guaranteed after they return to their units in the strife-torn East African nation.

The EU is seeking cooperation from other international players, including the United Nations, the African Union and the United States, to ensure the trained Somali security forces are paid regular salaries and to establish an effective international mechanism to channel funding for the military personal concerned.

The transitional federal government in Somalia signed an agreement with the auditing giant PricewaterhouseCoopers in July 2009 to ensure international aid does not go astray and potential supporters of the training mission are examining if that agreement can help ensure transparency in financial support to the security forces.

The EU has been examining the possible training mission for Somali forces since last summer, seeking to build on an existing French mission run out of Djibouti. The idea is to create core units that can strengthen the government in its battle with Islamist militants...

Under the current EU proposal, the training mission will be based in Uganda, since Somalia itself is considered too dangerous to host foreign educators. Uganda - which is a leading contributor to the African Union peacekeeping mission in Somalia - is already working to train Somali troops with support from the United States. The EU mission is expected to work with the Ugandans, but provide more specialised training.

Spanish Colonel Ricardo González Elul, who is heading the planning of the mission, led a fact-finding delegation to Uganda in mid-December 2009 to look into the logistics of setting up the headquarters of the mission, which is expected to involve the deployment of around 100 European experts to train up to 2,000 Somali troops. The mission will likely have a liaison office in Brussels and a representation in Nairobi.

The Indian Ocean Newsletter writes that the EUTRA mission may get the green light from the European Council of Foreign Ministers later this month. In addition to the Italians and the usual regional actors, Sh. Sharif met with several European officials this week in Nairobi.

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Getting back to the things Ould Abdallah gets away with saying, this comes after his presentation before the Security Council referred to in the Inner City Press report above,

SC/9844: Secretary-General’s Special Representative, Briefing Security Council, Calls Somalia ‘Global Crisis’ That Can No Longer Be Ignored

The crisis in Somalia was no longer local or even regional, but a global one that could no longer be ignored, Ahmedou Ould-Abdallah, the Secretary-General’s top representative in that country, said today in a briefing to the Security Council.

Mr. Ould-Abdallah, Special Representative of the of the Secretary-General and Head of the United Nations Political Office for Somalia (UNPOS), said the county’s Transitional Federal Government had made significant progress, despite repeated armed assaults by externally funded extremists attempting to overthrow it.

Citing the Government’s accomplishments, he said they included establishing its authority in Mogadishu, the capital; drawing up a budget; recruiting and training security forces; and keeping its political legitimacy over violent and extremist groups. The Government had remained open to all Somalis who were ready for dialogue and reconciliation, he said, adding that Somalia was moving from failed State to fragile State.

"establishing its authority in Mogadishu"?

Where's the transcript, for surely this remark alone elicited rounds of laughter to anyone with the least familiarity with the situation in Somalia's capital

The international community should overcome two main challenges, he said, describing the first as the absence of concrete commitment and determined international policy. Continued hesitation and lack of effective action had weakened the Government and encouraged the extremists, who included many foreigners whose ultimate objective was to maintain a permanent state of anarchy or to establish a militant State. Their ambitions went well beyond Mogadishu and Somalia, and posed a real threat to neighbouring countries, the Intergovernmental Authority for Development (IGAD) region and even distant lands.

He said the second challenge was the delay in translating international support into the necessary material assistance. Over the last 10 to 15 years, the international community had spent more than $8 billion in various forms of assistance, dealing primarily with the symptoms of the crisis, while the Government lacked the resources to fund even the most basic requirements, such as paying salaries. By contrast, its opponents and allied extremists received unlimited and unchecked financial support.

Which weighs greater there - delusion or dissembling?

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Last week I mentioned the case study entitled "Ambiguous or Unclear Involvement Between Terrorist and Criminal Groups: Al-Shabaab" in a recent Congressional Research Report, highlighting the passage

U.S. Navy officials, however, assess that there is no evidence to suggest that Al-Shabaab militants have financial or operational ties to pirates. Vice Admiral William Gortney, the commander of U.S. Naval Forces Central Command, told the House Armed Services Committee on March 5, 2009, that “We look very, very carefully for a linkage between piracy and terrorism or any kind of ideology and we do not see it. It would be a significant game changer should that linkage occur. But we have not seen it.”

From an analysis piece by a consultant for a London law firm involved in ransom negotiations with Somali hijackers, titled Somalia And The Gulf Of Aden: Piracy, Terrorism, And Ransoms, arguing for the legality of paying ransoms,

The presence of terrorists in Somalia has given rise to concern and speculation about the legality of making ransom payments to resolve hijackings. Different legal systems have different laws concerning the payment of ransoms, but in the context of English domestic law the payment of a ransom in response to extortion is in principle legal, and has been for almost 200 years, since the reign of George IV.

Whether, notwithstanding this general principle, there may be reasons why in particular circumstances the payment of ransoms to Somali pirates may be unlawful, was a matter that was recently considered in great detail by the House of Lords` EU Committee in their July 2009 report Money laundering and the financing of terrorism [HL Paper 132-I]. Among the Committee`s conclusions was that the payment of a ransom should not be made a criminal offence [Paragraphs 164 and 222]. The Committee was, however, concerned about the possibility that the proceeds of Somali piracy might be financing terrorism [Paragraphs 167 and 223], and urged the Government to explore this possibility [Paragraphs 168 and 224].

In considering the weight to be attached to the Committee`s views, it is appropriate to have regard to the evidence which they received [HL Paper 132-II]—in particular, the evidence given by the Government—and to the material revealed in the subsequent debate in the House of Lords.

Written evidence given to the Committee by HM Treasury and the Home Office [in Appendix A to their Supplementary Memorandum 3], conceded that the existence of terrorist groups in Somalia was well known, but added “It is not thought at the present time that Somali pirates are connected in any systematic way to those terrorist organisations.” The Memorandum then speculated that “If in the future it were to become known that such a connection existed, then it might become the case that the knowledge or suspicion limb of the offence would be satisfied ...”, creating an offence under sections 15-18 of the Terrorism Act 2000.

In its written reply to the Committee`s report [Cm 7718, published in October 2009], the Government welcomed the Committee`s recommendation that the payment of ransoms should in principle remain lawful. On the question whether the proceeds of Somali piracy were financing terrorism the Government said that it saw this as a serious issue, and that it had “examined intelligence for evidence of links between piracy and terrorism at the highest level. To date we have no evidence that terrorists are using piracy as a means of raising funds ....” They would keep the situation under review.

In the subsequent debate in the House of Lords, in December 2009, Lord Brett (Parliamentary Under-Secretary of State, leading on Home Office EU Business), commented at some length on the topic. He said [Hansard HL Deb, 7 December 2009, c978]:

“The Government regularly examine all available intelligence for evidence of links between piracy and terrorism. I have to say that, to date, we have found no evidence. I sympathise with the view that one cannot see vast sums of money being passed around in Somalia without believing that some of it could be going to terrorist organisations in one form or another.

“However, we have found no evidence of any operational or organisational links. There is much open-source speculation—we are all a part of it. The noble Lord, Lord Skelmersdale, asked what we are doing to try to establish whether it is true. It has not been possible for any of our or our partners` intelligence agencies to corroborate it. Therefore, it is a question not of a country having a view, but of intelligence that we have been able to glean from allies, as well as from our own endeavours, failing to find any organisational or operational link.”

This is also the conclusion reached in numerous independent reports, and by organisations such as the International Maritime Bureau which make a particular study of piracy.

One can read wild speculations almost every day in the press, recycled from one source to another—and given a measure of plausibility by those who see the hand of terrorism everywhere—about an organisational link between Somali piracy and terrorism. But HM Government`s position, set out above by Lord Brett, is very clear.

Regarding those "wild speculations", the East African this week ran an opinion piece -- masked as a news story -- written by Bruno Schiemsky, former chair of the U.N.'s Monitoring Group on Somalia from 2004 through 2008 which was infamous for its dodgy dossier that set up the pretext for the late 2006 invasion of Somalia with claims that the ICU was sending hundreds of al-Shabaab fighters to assist Hezbollah against Israel and thus an international terrorist outfit, that 20,000 Eritrean troops were inside Somalia training the ICU, that Iran was negotiating with the ICU to buy uranium for its questionable nuclear program, and so on [for instance, see Abukar Arman, "The Making of Another Iraq" (Washington, DC: Foreign Policy In Focus, January 3, 2007)]

Guns, drugs and terror: Somali pirates morph into poly-criminals

Investigations have revealed that these super-pirates have turned into transnational poly-criminals. They circumvent and adapt to the naval presence, and in their continued quest to expand their avenues for making money, the pirates are now engaging in vast criminal activities including money laundering, arms and human trafficking, paying bribing, extortion, training terrorist organisations such as the Al-Shabaab and more recently, protecting international drug cartels.

...

They are also inter-connected with other criminal groups for specific expertise and logistical support, additional money making activities and protection.

For instance, arms smugglers from the Middle East use the services of the pirates, who know how to evade international naval forces, to bring shipments into the arms market in Mogadishu, thus contravening the United Nation’s arms embargo. The pirate groups are rewarded with money or a portion of the shipment. More recently, the pirate groups began to provide protection to cartels that use Somalia as a transit point for drugs such as heroin from Asia to Europe.

Some of the groups they have formed alliances with include terrorist organisations such as the Al-Shabaab. The pirate groups started to train a maritime component of the Al-Shabaab to engage in piracy and the smuggling of foreign fighters into Somalia. The Al-Shabaab on the other hand provides military training and arms to pirate groups. Between 10 and 50 per cent of the ransom (depending on the nature of the relationship) is paid to the Al-Shabaab.

...

In order to curb acts of piracy and prevent Somali pirates from expanding into other criminal activities, the international community must move away from simply reacting and watching and implement a co-ordinated, systematic and proactive programme to deal conclusively with a problem that is no longer confined to the Horn of Africa.

This is true not only because of the impact it has on international trade, but more so, because of the developing relationship between the pirates and the Somali insurgent group, Al-Shabaab, whose operations against the Somali Transitional Federal Government are financed by ransom money.

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From a BBC article Sunday, the current spokesperson for Harakat al-Shabaab Mujahideen says essentially the same thing the mvmts former spokesperson always said

Al-Shabab spokesman Sheikh Ali Mohamud Raage portrayed al-Shabab as no more than the organised arm of Islamic resistance to Western oppression.

He denied formal links with groups like al-Qaeda.

"What is al-Qaeda?" the Sheikh asked. "It is Muslim people who are massacred in countries like Iraq, Afghanistan and other Islamic countries like Yemen."

A Muslim is the brother of other Muslims, he said, "so we and al-Qaeda share the Muslim faith and are fighting for freedom. That's all we share."

Sheikh Raage rules out talking to Somalia's Western-backed government, saying this can only take place when African Union forces present in the country leave.

He also warned that if American troops are ever sent to Somalia they will end up dead.

"They will suffer the same fate they did in 1993, when they were dragged through the streets of Mogadishu," he said.

Al-Shabab's message is one of unremitting hostility to Somalia's government and any form of Western involvement in the country.

"We are on that road, and we will be on that road for the rest of our lives," said the sheikh.

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This doesn't bode well for Ould Abdallah's stories - firefights in the capital between TFG security forces and the foreign fighters of AMISOM

Shabelle Media: Bitter confrontation between AU and TFG troops erupts in Mogadishu

Bitter confrontation between the security forces of the Transitional government and African Union troops AMISOM has broken out at Aden Adde international airport in the Somali capital Mogadishu, witnesses told Shabelle radio on Sunday.

Reports say that the fighting between the two sides came as a Ugandan soldier who was keeping guard at the airport suspected another military vehicle of the TFG that mounted a heavy gun which caused the two sides to exchange heavy gunfire injuring Somali government soldiers.

It is unclear what casualties reached the AU troops and there is no comment from both sides about taday’s fighting so far.

Residents around that airport said told Shabelle radio that the fighting between the two sides continued for a while saying that they knew nothing about the real casualties of their conflict.

It is the first such confrontation between the transitional government and African Union troops AMISOM since their arrival of AMISOM in Mogadishu in 2007

And this, in Sunday's Daily Monitor:

AU army morale falls, Ugandans in danger

Military sources tell Inside Politics a four-month salary delay for battling African Union troops in Somalia, over half of whom are Ugandan, is straining morale and could pose serious threats to the mission itself.

“Soldiers are not happy because they don’t know what is going on,” said a source who preferred anonymity so as not to be identified speaking directly about army.

Uganda has lost 45 troops in Somalia while Burundi, the other only troop-contributing African country, has had 58 of its soldiers felled, mainly by mortar shells and suicide bomb explosions.

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There are also issues about pay disparities between the Ugandan and Burundian troops, which have been quietly growing. According to sources familiar with the details, each soldier on duty in Mogadishu is expected to earn an average $750 (about Shs1.4 million).

The Ugandan government however, sources say, deducts $200 from its soldiers while Burundian authorities deduct $100 from their soldiers. This disparity in earning between Ugandan and Burundian peacekeepers is causing anxiety among the Ugandan soldiers, sources say.

Uganda has a public record of military corruption over salaries captured by the high profile trial of senior military officers in the famous Ghost Soldier trials intended to clean up graft in the payment systems.
It is also reported that the salary delay itself is a result of suspected corruption.

The African Union based in Addis Ababa has reportedly failed to correctly account for the millions of dollars contributed to the Somalia mission by among others the European Union, Britain, the United States and Norway.
Donor countries also contribute non-monetary support. The situation which has gone on for months is likely to be noticed by other countries which, like Nigeria, had pledged troops to Somalia.