The Price of Investing in Foreign Lands
Kenyan security forces round-up of thousands Somalis in Nairobi's Eastleigh neighborhood
by Heikal Kenneded
Sunday, April 24, 2014
Sunday, April 24, 2014
Of all the lessons to be drawn from the recent Kenyan security crackdown
of the Somali communities in the Eastleigh enclave of Nairobi, the most
widely accepted maybe it’s time that Somali businesses quit investing
in foreign countries where they stick out and begrudged, instead invest
in their homeland. The Somali community's success in Eastleigh, Nairobi
has long elicited the envy of many Kenyans who for the longest time
wondered how these mere refugees who entered their country two decades
ago could run the city’s most lucrative shopping mecca while buying all
the plots for housing. This has ultimately caused tension within
communities in Kenya, leading to pervasive, but unsubstantiated
accusations of links to piracy and terrorism activities. However, this
recent police sweep and unwarranted targeting of Somalis in Kenya was a
long time coming and it lies in the heart of the native’s resentment
against thriving Somali business boom in their midst.
On April 1st, I was in Nairobi when a couple of grenade attacks that
killed six people in two Somali restaurants in Eastleigh shocked the
Somali community to the core, which then led the Kenyan government
ordering all Somali refugees to go back to designated refugee camps.
This also sparked unprecedented security crackdown in Eastleigh, where
more than 5,000 people have been rounded up in less than a week and
amassed them in the Kasarani stadium. Ironically, close to a quarter of
century ago, following the civil war in Somalia, I began my own exodus
into the diaspora from Eastleigh, Nairobi, where I was the victim of
random police harassment. Witnessing this latest so called “security
sweep” in Eastleigh, which is nothing else but a great chance for
bribe-taking and harassment by the corrupt Kenyan police, thus I
remember thinking: “Even though many things have changed in Kenya,
including its leadership and the country’s overall landscape, what
hasn’t changed is the relentless Kenyan police brutality of the Somali
community.” Yet, despite the dramatic evolution of the Somali community
in Kenya from early refugees to business entrepreneurs who contribute
close to a quarter of the country’s GDP, their status as second-class
citizens has remained static. Unfortunately, this is the price that the
Somali business community pays for investing the bulk of their economy
in a country like Kenya, where acute corruption is pervasive and acts as
an accelerant to everything else that’s wrong in the country, including
increasing poverty, crime and insecurity.
The prosperous Somali commerce concentrated in the Nairobi enclave of
Eastleigh has thrived for the last two decades simply because of the
unsurpassed Somali entrepreneurial acumen of providing goods and
services to local and regional consumers at bargain prices, which are
well below the market average. In fact, the unrivaled Somali commercial
sprit is felt far beyond East Africa all the way to the Gulf States and
Southern Africa, where they have demonstrated a knack of establishing
businesses anywhere in the world. No matter wherever one travels in the
large continent of Africa, Somali entrepreneurs are found establishing
themselves as the new capitalists to be reckoned with and within few
years easily dominate the market. The aggressive Somali business
marketing combined with their ostentatious nature as people has created
so many enemies in most African countries they’ve established their
businesses, where they run the risk of being targeted for random crimes,
including homicides. In result, there are few safeguards for their
investments and mostly suffer catastrophic losses of investment or much
worse lives.
For example, the scale and ubiquitous xenophobic attacks of Somali
shopkeepers in the townships of South Africa has for long dominated the
news. Since mid-1990s, after many young and ambitious Somali men in
their search to escape the civil war back home immigrated into the
country and started establishing small shops in these townships, but
soon became victims of unparalleled violence after they were accused of
either putting S. African shopkeepers out of business or undercutting
their prices. In effect, hundreds of Somali-owned small shops were
looted while others were burned to the ground by petrol bombs,
eventually driving the Somali shopkeepers from the area by charging
local thugs. Despite the gruesome violence against Somalis in S. Africa,
the government has only paid lip-service, which left most of these
shopkeepers to move back home in order to escape this type of targeted
violence.
 Ndola, Zambia residents riot and loot Somali owned businesses |
Another case in point took place in Ndola,
Zambia a country where early Somali business investors thrived since its
independence, when in 2012 a Somali businessman shot and killed one of
his workers due to a wage conflict and he was immediately arrested for a
lifetime imprisonment. Nevertheless, immediately after this incident
the entire town’s folk took to the streets in riot mode and launched
indiscriminate attacks against all Somalis in Ndola, including women and
children, which lasted for an entire week as all Somali residents went
in hiding.
The time has come for most Somali business owners, especially those
in Africa who seem to be caught between a rock and hard place to do some
soul searching, to either choose of being constantly undermined in the
hands of foreign countries where they’ve heavily invested, or to move
back in their homeland and to establish their businesses, where the
risks of insecurity run parallel of the opportunities. I’m in the
opinion that the cost-benefit analysis favors establishing any business
in one’s own country rather than in foreign land. Apparently, the main
obstacle to most Somalis of investing in their homeland is the lack of
security and political instability not conducive for a long term
economic sustainability. Nevertheless, the risks of establishing
business in post-conflict Somalia present many opportunities of tapping
the economic potentials of the country, while at the same time
rebuilding the country from the ashes of the civil war by creating jobs
for the young and therefore contributing to the overall stability of the
country.
In the end, the Somali federal government has a very important role
to play in attracting the Somali businesses dispersed in the African
continent by creating the necessary security apparatus to run a viable
business, combined with incentives of tax reform and regulatory
framework restructuring to promote economic sustainability. Perhaps this
latest incident in Eastleigh might be a blessing in disguise that holds
the key to creating an ever lasting peace and prosperity in Somalia,
which became an elusive dream to achieve for the longest time.
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