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PP RUEHDE RUEHROV RUEHTRO
DE RUEHNR #2618/01 3250733
ZNR UUUUU ZZH
P 200733Z NOV 08
FM AMEMBASSY NAIROBI
TO RUEHC/SECSTATE WASHDC PRIORITY 7626
INFO RUCNSOM/SOMALIA COLLECTIVE PRIORITY
RUCPDOC/USDOC WASHDC 3095
RHEHNSC/NSC WASHDC
RUEKDIA/DIA WASHDC
RUEAIIA/CIA WASHDC
RHMFIUU/CJTF HOA
RHMFIUU/CDR USCENTCOM MACDILL AFB FL

UNCLAS SECTION 01 OF 03 NAIROBI 002618 
 
SIPDIS 
 
SENSITIVE 
 
DEPT FOR AF/E AND A/S FRAZER 
ALSO FOR AF/EPS - Ann Breiter and Ada Adler 
STATE PLEASE PASS TO USAID/EA 
COMMERCE FOR BECKY ERKUL 
 
E.O. 12958:  N/A 
TAGS: PGOV PREL ECON ETRD EAID KWMN SO AE
SUBJECT: SOMALIA - Diaspora Business Thrives in Dubai 
 
REF: A) Nairobi 543  B) Nairobi 2553 
 
¶1.  (U) SUMMARY.  This cable is the first of two on Somalia's 
Dubai-based Diaspora.  Though Somalia remains mired in conflict, the 
country's private sector boasts successful operations in a variety 
of sectors including livestock, telecommunications, shipping, 
transportation, import and exports of various commodities.  Major 
business leaders are based in the United Arab Emirates (UAE), using 
Dubai's open trade and financial platforms as a lifeline to their 
interests across Somalia.  The Dubai-based Somalia Business Council 
is defunct, having split three years ago in conflict over its 
leadership, but there was interest in re-organizing another formal 
association.  Our interlocutors welcomed the prospect of 
strengthening trade and commercial relationships between Somalia and 
the United States.  All said that full U.S. engagement on Somalia, 
especially with our allies in the Persian Gulf, is a necessary 
ingredient for any success.  END SUMMARY. 
 
------------------------- 
Dubai: Somalia's Lifeline 
------------------------- 
 
¶2.  (U) Between November 7 and 13, Somalia Unit PolOff met with some 
of Somalia's most successful business leaders who operate from Dubai 
but maintain major influence in the vibrant economy that continues 
to grow despite the ongoing conflict (Reftel A).  Somalia has 
historically been an important link for trade between East Africa 
and the Arab World and Somalis have established close relations with 
countries across the Middle East.  In addition to long-held 
religious ties that bind Somalia to Saudi Arabia, countries like 
Qatar, Kuwait, Yemen, Oman, and Iran have played an increasingly 
important role.  Yet the UAE has emerged as a hub for Somali 
business and in the post-civil war era, Dubai has become Somalia's 
lifeline.  With the collapse of the Somali government, failed 
institutions, and violence that has forced millions to flee, a large 
Somali community has found safe-haven in Dubai. 
 
¶3.  (U) Many Somalis living in UAE hold passports from other 
countries, typically Canada, the U.S., and several European 
countries.  Others retain only their Somali nationality.  While 
travel for them in most parts of the world is difficult, they have 
had no trouble declaring residency in the UAE, and are welcomed in 
Dubai as "fellow members of the Arab world."  It is standard to have 
several nationalities in one family.  The Somali Embassy in Abu 
Dhabi does not have a formal count of the number of Somalis in UAE, 
but some observers estimate that as many as 100,000 Somalis are 
residents and countless others regularly travel there on business. 
 
 
¶4.  (U) With its open trade platform and financial system, Dubai has 
become the base for activities across all of Somalia's sectors.  In 
telecommunications, for example, operators are unable to directly 
purchase equipment for their Somali-registered companies as most 
suppliers (except Chinese) refuse to sell, ship, and install 
equipment in Somalia.  Instead, they use their Dubai-registered 
affiliates to order any necessary equipment, now mostly sourcing 
from Asia, and then trans-ship via Dubai to Somalia.  In financial 
services, major money transfer companies use Dubai-based 
institutions for their transactions, especially as most of the U.S 
banks have recently closed their accounts.  For major commodity 
trading, the shipping operators use Dubai as the hub for their 
activities, ordering rice from India, Pakistan and China to import 
(along with every other imaginable item) to Somalia.  The delivery 
ships and planes leave Somalia filled with livestock, meat, and 
charcoal, Somalia's major exports.  In every sector, Dubai and its 
Somali Diaspora play a major role in supplying all regions of the 
country with its basic (and not so basic) needs. 
 
---------------------------------- 
Help With Gulf Cooperation Council 
---------------------------------- 
 
¶6.  (SBU) Our interlocutors from all sectors discussed the 
importance of Somalia's trade with the Middle East, particularly in 
livestock.  They said that one of the most important ways the U.S. 
can help Somalia is by using its influence with countries in the 
Gulf Cooperation Council (GCC), especially Saudi Arabia, to re-open 
its markets for direct imports of Somali livestock.  They told us 
that in the late 1990s during an epidemic of Rift Valley Fever in 
 
NAIROBI 00002618  002 OF 003 
 
 
East Africa, the Middle East ceased imports from the region until 
more stringent health requirements could be met.  Livestock from 
Somalia is now shipped, mainly from Berbera and Bossaso, to UAE, 
Oman, and Yemen.  While Saudi Arabia has long re-commenced imports 
from others countries in the region, it has not directly accepted 
Somali livestock.  Instead, a significant amount of Somali livestock 
is transported to Djibouti and goes through its facility (now 
controlled by a Saudi company) to Saudi Arabia.  They said that if 
Somalia was allowed to ship directly to Saudi Arabia, the livestock 
industry would grow and pastoralists across the country would be 
able to sustain their livelihoods. 
 
¶7.  (SBU) Slaughterhouses in Mogadishu, Galkayo, Beletweyn, and 
other cities regularly supply fresh meat to Dubai that is inspected 
at the point of origin by officers of Dubai-based municipalities. 
The meat (usually beef and lamb) is then transported by 15 to 16 ton 
capacity Russian-made aircraft to Dubai where it is once again 
inspected and sold to wholesalers who supply meat markets in the UAE 
and beyond.  The Somali business owners told us they would be able 
to get a better price if they had their own facilities and could 
directly supply the Gulf region.  They said that more formal U.S. 
recognition of the TFG would encourage GCC countries to recognize a 
national authority that could formally certify the livestock and the 
meat in Somalia at the point of origin.  The Dubai-based Somali 
business leaders requested full engagement by the U.S. on Somalia's 
economy, not just its politics.  They agreed that if the U.S. were 
to ask Saudi Arabia, Kuwait, Qatar, and other countries to focus 
their efforts on Somalia, the Gulf countries would immediately be 
forthcoming with increased official assistance and more private 
initiatives to increase trade and sustain livelihoods in Somalia. 
 
 
------------------------ 
Somalia Business Council 
------------------------ 
 
¶8.  (SBU) From 2001 until about 2006, Dubai was the home of an 
active Somalia Business Council (SBC) that all agreed was highly 
successful for about five years.  The SBC was reportedly comprised 
of about fifteen members, four of whom were from Somaliland.  The 
organization operated as an advocate for business interests in 
Somalia and was a venue for information-sharing and 
community-building among its members.  As the organization 
developed, it began the process of drafting by-laws and articles of 
association.  When it came time to elect a Chairman, two highly 
influential businessmen, Sharif Ahmed Ba'alawi and Mohamed Jirde, 
each received the same number of votes.  Neither Ba'alawi nor Jirde 
were steadfast on holding the office and each volunteered to let the 
other lead, but neither of their respective constituencies would 
back down.  Although the council formed a committee to resolve the 
leadership dispute, they also reached an impasse.  The Council 
subsequently dissolved and has not been active for approximately 
three years. 
 
¶9.  (SBU) Many of the persons with whom we spoke indicated an 
interest is reviving an SBC-like structure.  Others criticized us, 
the World Bank, the UN, and other institutions for reaching out only 
to the SBC and for not engaging with business leaders outside of 
this organization.  In particular, some of the medium- and 
smaller-sized businesses said they are equally important, if not 
more so, because their numbers are greater, yet they are never 
sought out for consultations.  A few mentioned the more recently 
established Djibouti-based Somali Business and Investment Council 
(SBIC) (Ref B) as another institution with whom they have alliances. 
 There are also other trade-specific organizations like the Somali 
Telecommunications Association, established in 1998, which has 
worked with UNDP and the Work Bank to develop Somalia's 
telecommunications infrastructure.  While personal business 
interests are the highest priority, the business leaders believed 
that collective action would have the greatest long-term impact on 
improving Somalia's investment environment. 
 
----------------------------- 
Women-Owned Business Thriving 
----------------------------- 
 
¶10.  (SBU) While the major Dubai-based business leaders are men, 
there is a growing numbers of women who have successful operations 
in the city.  In the area of Dubai known as the Old Gold Souk, there 
 
NAIROBI 00002618  003 OF 003 
 
 
are at least 100 Somali-run shops selling jewelry, clothing, 
perfumes, beauty products, and other items.  Many of these are owned 
and managed by Somali women.  We met with first woman to open a 
jewelry store in Dubai.  She said that most of her clients are 
Somali or West African women typically from Senegal, Mali, 
Mauritania, and the Gambia who purchase goods in Dubai for resale in 
their home countries.  On a regular basis, she sends gold jewelry to 
Somalia.  She said, "We get reports of shooting and violence, and 
yet they call later the same day and order nine kilos of gold -- 
they have always accepted each shipment." 
 
¶11.  (SBU) Many of these women shop owners have worked their way up 
from infrmal trading and some "graduate" to other activities. 
While in Dubai, we met one shop owner who is currently a TFG Member 
of Parliament.  Another businesswoman, Amcit Sofia Nurie, has owned 
a jewelry store, a "ready-made" clothing shop, and now owns five 
trucks and contracts with Dubai-based construction companies to 
transport materials.  There is no formal association for the Somali 
women business owners and there were no female members of the SBC 
when it was operational.  The women with whom we met also closely 
followed current events inside Somalia and they had very strong 
political views.  Many told us, "It is the men that have caused all 
of the problems in Somalia and alone, they will never get anywhere - 
it is time for women to take a more active leadership role."  All 
were delighted to hear of U.S. interest in Somali women 
entrepreneurs.  Zahra Abdulle, a Canadian-Somali business owner who 
has been living in Dubai for 28 years, recommended that we reach out 
to intellectuals as well as business leaders to expand the "small 
prism" through which we view Somalia. 
 
------------------------------- 
Engaging the Business Community 
------------------------------- 
 
¶12.  (SBU) We are working with the United Nations Political Office 
for Somalia on its meeting to engage Somalia's business elite, 
scheduled for December 20-23 in Dar es Salaam, Tanzania.  SRSG 
Ahmedou Ould-Abdallah hosted a meeting of several of the most 
influential Dubai-based business leaders in January 2008 and S/E 
Yates participated in this event.  UNDP is also spearheading an 
initiative to engage with Somalia's business sector and recently 
spent two weeks in Dubai to assess how to re-energize the Somali 
Business Council.  We will continue to strengthen our relationships 
with the Dubai-based business community, as well as with Djibouti's 
SBIC, Nairobi-based business leaders, and with the formal an 
informal associations operating inside Somalia.  These networks are 
critical for their influence on the economic development of the 
country and their business leaders also play an important role in 
Somalia's political arena. 
 
¶13.  (U) The Somalia Unit thanks Consulate Dubai for facilitating 
the visit on which this telegram is based. 
 
RANNEBERGER