* Funds come from taxing small businesses, charcoal trade
* Many Shabaab men cite money, not ideology, as motive
* Somali businessmen may be most powerful lever against
militants
By William Maclean
DUBAI, Sept 26 (Reuters) – Al Shabaab emerged as a regional
threat funded by millions of dollars from activities ranging
from extortion to taxing charcoal exports, but its attack on a
Kenyan shopping mall is expected to provoke a counter-terrorism
response aimed at crippling the Somali Islamist group’s
finances.
The money is important to al Shabaab, a group whose aims
include the wider imposition of Islamic law but whose ability to
attract fighters in one of the poorest countries of the world is
based largely on its ability to pay them.
A report by U.N. monitors in July estimated al Shabaab
earned more than $25 million a year from illicit exports of
charcoal to Gulf Arab states and from taxing the trucking of
charcoal to the Somali ports of Kismayu and Barawe.
Other funds come from informal taxes on small businesses in
areas of Somalia that al Shabaab controls, and from donations
from Somalis overseas, although these transfers are thought to
be declining due to a general disenchantment with the
increasingly violent group in the diaspora, diplomats say.
A security source in the capital, Mogadishu, said al Shabaab
was expert at extorting money from small businesses and at
setting up front companies whose income was funnelled to the
group. Both sorts of company also acted as informers.
“It’s the small little shops where you repair your vehicle,
or charge your mobile phone,” the source said. “It’s a myriad of
little businesses, who also help them in their surveillance.”
“There’s no need for heavy-handed daily enforcement because
everyone knows the penalties for non-compliance are drastic,” he
said, referring to the amputation of limbs or execution.
Suspected additional sources of income include militant
Islamists overseas and, according to U.N. sanctions monitors,
the nearby state of Eritrea.
The monitors said Eritrea was destabilising Somalia by
paying political agents and financing a warlord linked to al
Shabaab.
The Eritrean government, accused by its critics of seeking
to use Somali territory to undermine Ethiopia, its old enemy,
has long denied meddling in Somalia, saying it has no links to
al Shabaab’s fight against the Somali government.
Al Shabaab has been waging an insurgency since 2007 and
formally became part of al Qaeda in 2012. It remains Somalia’s
most powerful non-government armed group despite being pushed
out of Mogadishu by an African Union force in 2011.
PENALTIES
Al Shabaab’s economic strength is vital to its operations
because it can pay its thousands of fighters a monthly salary
normally varying between $100 to $300 a month.
That, more than its declared aim of imposing a strict
version of Sharia or Islamic law, is the main incentive to join
up, Somali researchers say.
Ironically, al Shabaab’s income may have benefited from an
upturn in the Somali economy that followed the partial
restoration of order in Mogadishu over the past two years and a
growth in investment amid hopes of an end to years of war.
In the wake of the four-day attack by al Shabaab militants
on a Nairobi shopping mall in which at least 72 people were
killed, Western counter-terrorism agencies are expected to
subject the group’s sources of financial support to renewed
scrutiny, Somali experts say.
The success of such efforts will depend to a large extent on
the choices made by Somalis, in particular the powerful Somali
business community in east Africa.
According to Ken Menkhaus, a leading U.S. scholar of al
Shabaab, the most formidable weapon against al Shabaab may be
the Somalia expatriate business community in Kenya, which has
emerged as a force in property and trade in the past 20 years.
DIASPORA FUNDING DWINDLES
Since the collapse of the Somali state in 1991, more than
one million Somalis have fled to or through Kenya, and many now
have extensive business and real estate investments there.
Fearing a crackdown on Somali firms by a Kenyan government
keen to be seen to be doing something, Somali businessmen in
Nairobi might now feel compelled to take their own steps against
the group, he wrote on the website http://www.thinkprogress.org.
“Messing with Somali business interests has never advanced
the interests of any political actor in Somalia, foreign or
local,” he said.
It was up to Somalis to “mobilize against Shabaab and take
the movement out once and for all by drying up its financial
sources, exposing its operatives, and denying the movement any
safe space from which to operate.”
The alternative, he said, was action by foreign governments,
but that would almost certainly impact “innocent Somalis and
legitimate Somali businesses in Kenya and around the world, and
that is not in anyone’s interest except Shabaab’s.”
Stig Jarle Hansen, a Norwegian expert on the group, told
Reuters that what was best known about al Shabaab finances was
its system of local taxation in the areas it held, especially
the taxation of transport. But verifying this information was
difficult and was hampered by hearsay, he said.
In Somalia, a traditional kinship society, research was
complicated by the fact that while someone might nominally be in
al Shabaab, in reality people were more loyal to their clan
elders, he said.
POCKETS OF SYMPATHY
Adam Matan, head of the Anti-Tribalism Movement, an advocacy
group that campaigns against the political exploitation of clan
identity in Somalia, said al Shabaab fighters told him on his
research trips to Somalia that money was a key attraction.
“If you can get a few dollars a month to feed your family,
you will take it,” said the British-based former Somali refugee,
who travels frequently to Somalia, echoing findings in previous
Reuters reports about Somali militancy.
Mohamed Aden Hassan, a researcher at Goldsmiths College in
London who studies the Somali diaspora, said he believed
diaspora funding had all but dried up for al Shabaab in recent
years although there were pockets of sympathy “here and there”.
Al Shabaab remains in control of most of southern and
central Somalia, a U.N. report published in July 2013 said.
According to the report, defectors from al Shabaab said the
wage paid to fighters ranged from $100 to $500, “depending upon
clan affiliation and seniority”.
In September 2012, al-Shabaab fled Kismayu, the main
charcoal export outlet to the Gulf, and Kenyan troops in the
African Union peacekeeping force took control.
The U.N. Security Council banned the export of charcoal from
Somalia in February 2012 to help squeeze al Shabaab’s finances.
But shortly after the AU secured the port, Kenyan forces
unilaterally lifted the ban, arguing Kismayu’s angry charcoal
traders could undermine the security of their troops, the U.N.
report said. The Kenyan military denied the allegation.
In the months that followed, al Shabaab got back into the
trade thanks to ties to local business networks, earning
revenues from about a third of the volumes exported.
The charcoal is sold largely to customers in Dubai who sell
it on elsewhere in the Gulf, the U.N. report said.
The largest user of the product is Saudi Arabia, according
to Farah M. Mohamed, president of the Somali Environment
Protection Alliance Network.
He wrote in a June 2013 blog that Saudi Arabia used Somali
charcoal primarily for shisha (hookah) pipes, cooking in upscale
restaurants and homes, as camping firewood, and as an extra
source of heating in the winter.
