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abdi.ismail wrote:That's all good but, where does the material and expertise come from in your analogy? Where does the copper pipes for heating come from? The material to build underground sewage systems and lead the waste to a safe and clean plant for treatment? Where does the tar and gravel for roads and highways come from? Or the machines that break the stones to make the gravel? Who builds the steel factories to make the railroads? The currency is the easy promote among people within a country, but how do you make sure it's accepted outside the country in the wider world?

good question..
the answer is exchange controls.
We have no controls, dahabshiil and co do as they please and throw the government some crumbs, the shilling is useless because it has no reserves and the country in effect is dollar economy.
Somaliland has twice as much hard currency flowing into the country as eritrea, a couple of years back it was 4 times as much hard currency.
The eritreans had exchange controls from day one, you bring dollars, euros into the country, it has to be exchanged into nakfa, you cannot use dollars.
Dollars are provided to the importers by the government.
Its sounds dictatorial and inefficient, but guess what???

This is exactly what South Korea dis between 1962 to 1998, Japan had restrictions but they found a sneaky way to do the same thing.
Sweden had it during its industrilization, Finland was an extreme example and their controls where much stricter than Eritreans today or south koreas.
Austria did it in the 50's and 60s',.

Eritrea with less than 1/3 of our supply of dollars was able to buy all this machinery, build its own roads, and railways, entire city blocks,
and even afford Mig-29 and Su-27s costing $15 million dollars each while we allow dahabshiil, and other xawalad to control the currency and the qaad importers give our dollars to
ethiopian qad farmers.

What I meant was how do we progress with no human resources at all. Surely primary education and vocational colleges should be our main priority.

The currency control thing sounds like it is due to a lack of understanding and corruption. Maybe we should force every governmental official and worker to take civil service exams like in ancient China before even being allowed to be interviewed for the job . Except instead of Confucian classics they should study Finance and management.

Human resources is the key and we have so little.
Its not the only reason for our state though, its lack of imagination, corruption and greed.
Even with the desperate state of our HR and natural resources with the right policies we can have a GDP per capita of 5000 (2013 dollars) in a few years.

the big ticket items of development is 'capital', 'infrastructure' and 'capacity'. Capacity is basically the ability of a society to 'do' economic activities. For instance India's huge number of high tech university graduates means they have a huge amount of 'capacity' for tech, IT and support outsourcing, which their 'infrastructure' (electrical supply, high speed internet) can barely manage to support, and which makes India tons of money. India's similar huge workforce has attracted 'capital' from around the world and it's allowed their industry to grow massively, following the path followed by Japan, South Korea, Taiwan, Malaysia and China.

Somalia has very limited capacity for most industries, no available capital, and the worst infrastructure in the world. Educating more 'capacity' and the infrastructure to support it (more and more reliable electricity, high speed internet, better roads, more ports) and the 'capital' will come in to build industries. It might be counter-intuitive to educate a ton of IT specialists in Somalia for an IT industry that doesn't exist, but that will create 'capacity' for an IT industry that can't happen without it.

India's economy is not one to be followed. However, South Korea and Taiwan's are enviable.

Gurey spotted one of the problems, that is currency. Another problem is, keeping the people you have trained/educated inside the village, how do we reduce brain drain of the village, we have seen time and again, skilled people will run to places where they can work for better pay or just better living, they have no patience for bettering the village even if they are locals.

wealth accumulation isn't the problem, it is retaining that wealth that creates serious challenges, whether the wealth is monetary or skilled individuals. What we can do to mitigate this problem of retaining wealth is having a serious look at the flawed economic system and the underlining social problem that causes people to flee and risk their lives on makeshift boats.