Now why are these people poor and starving and suffer from inflations , 4 reasons:
1- 90% of that money that enters the country leavs as fast as it came through buying foreign goods and the lack of banking. Lets say somaliland diaspora send $100, now that $100 will be spent on , food which mostly comes from outside the country. like, oil, rice, flour sugar, tea , qaad , cloths and meat. Now notice all the items there only the meat is produced locally, in another word 90% of that money goes to these countries that produce these goods basically. The merchants in addition will deposit their profits in foreign countries like UAE and deprive the country of that hard currency. Its a parasatic trade , 100% exploitations with zero benefits in retrurne.
2- Main reasons for somaliland inflations is , too much money chasing too few goods, and thats man made not real economics , since the market is monoplized by few rich merchants. The main reasons for that kind of inflations is as the following, example the price of coffee in Hargaysa , in all major hotels in Hargaysa the price of coffee is around the same price as Starbucks in north America , now imagin that a dude in Hargaysa paying $2 for a coffee that comes from the next door?? why? because they can afford too, easy money comming from the West + savy traders that know these people have money that comes from outside that they will spend regardless. In somaliland even teenagers kids will aske you for more then $200 , a cousin of mine aged $18 once told me $100 is chump change , now imagine that. In ethopia thats the income of an entire family in 4 months.
3- Corruption , the main one in terms of economics the fact that even after 22 years of independence somaliland's various goverment as of yet refuse to ban merchants from doing the foreighn exchange, now imagine if you can send $100 to somaliland's centeral bank and have the goverment exchange that money for your grandmother instead of the street merchants. By doing that simple actions the goverment of somaliland will fix and control the exchange rate and get $100 in hard currnecy that can be used to build the country.
4- Somaliland is the only country in Africa where the currency is exchanged in the street and the the few merchant in the street decide how much the $ will be traded for through a genetelmen agreement, so when they sell their prodcuts they charge people by the $ and make the most in the deal, in the otherside they manupilate the exchange rate between somaliland shilling and the dollar and get a double wammy, both ways win win.
One word they are apes. They don't even know the basic task of the minister of finance, that is to plan the economy not collecting taxes only. Somaliland's minister of finanace just tallies the revenue from taxing poor fendor women , selling vegies and qaad and tea.
In all of Africa its illegal to exchange money in the street, in Erteria every $ollar sent by the diaspora is by law desposted in the goverment bank and the goverment will exchange it for you , by doing that the goverment gets the hard currency to build the country and buy foreign materials to do so.
In somaliland , that task is left for Dahabshiil and the rest of fat cats , not only they they fecilitate the capital flee ( to the outside) they even fix the exchange rate and inflate the somaliland shilling and they have done that around 20 times , and everytime instead the somaliland goverment investigating this fraud the somaliland goverment prints more shiling ( thats the only Monetray policy they seem to know) and by printing more and more money everytime the local merchants inflate the exchange rate the goverment adds to the inflations by printing more money to solve the problem created by the fat cats.
All that can be solved by law like the rest of Africa, bann private exchange and order all remmitence companies to despoit all wired money into the central bank period, and let people get their money from the centeral bank which will do the exchange , also the somaliland goverment can demand from all these traders to deposit certain percentage of their profit in somaliland banks. Finally, the somaliland goverment can ecnourge local business men to make things at home , for example cloths by puting tarrif in cloths made oustide and for while to help import cotton and thus make cloths in somaliland and via that creat jobs.
The only way most countries creat jobs , is by making things they use, from cloths , to cleaning things to food goods, to the flip flop most somali wear. You can't creat jobs by not making your own products, somaliland should get rid of this "free market" bull shit that they seem to love but not know . Even America and most of Europe and Japan developed by making things they use and ban imports or put tarrif on it , its called " protecting infant industry" its a term coined by Alxendera Hamilton and later Germany copied the model and industerlized , later Japan learned from Germany and so forth.
No country ever develops by open trade bull shit free market .Contarary to what they tell you, fact is there is no way Africa can compet with advanced western industry and Asia even in manufacturing flip flops or toilet paper , fact is they are way advanced then us , its like puting Mike Tyson and you in a ring and say lets compet , a man that was training all his life for this, he is going to knock your arse down whatever 'innovations" you do.. you arse is going to hit the floor.
Can someone tell me what the financial policies of the Somaliland Political Parties are? you know when it comes to free market, taxation etc.. what are there views?
hardly heard anyone even talking about that during the elections- only clannish stuff.
Xplaya, the issue is there is a fluidity of buisnessmen and politicians. One or the other, and some even see politics as a business opportunity. This close relationship of elites of both sides, act as if they are one ruiling party. I remember watching an interview with ali waraabe and he was asked if he would criticize siilaanyo and Kulmiye for being too close to dhabshiil and their campaigns being funded by them, and he said no, because he too and his party get funding from dhahabshiil. lakin, instead of using this two very powerful institutions of government and private sector to rebuild and strengthen the country, no one really cares or is too dependent on outsourcing their responsibilities. Cut donors funding, and there will be an imperative to make a viable and sustainable economies for the government to survive.
Also, students need ethics and civics training in schools, as prerequisites for graduating.
To receive remittance money through the central bank instead of Dahabshiil will be a challenge. They're too powerful and they have too much sway in our politics. First we have to separate and make it illegal for any business to fund campaigns so that later they cannot have unfair advantage in the free market once their funded candidates emerge.
I dont have much to add here, but a great read (listen) is The Invention of Money by the good people at This American Life. In it you get to hear the story of the Brazilian Real, and how a team of economists turned around the misfortune of Brazil and fixed its economy. Its pretty fascinating:
Xplaya you hit this right on the nail,
corruption will kill somaliland and is a much bigger danger than anything that we have ever faced.
Eritrea with 6 million people has less than 40% of Somalilands foriegn exchange and yet they build their own roads and bridges, their own city blocks and ports.
They can buy and operate SU-27 fighter jets that cost 15 million each .
We have 3.5-4 million to their 6 million, and we have a larger educated class mostly in the diaspora and nearly 3 times their access to hard currency and what do we have to show for this?
fancy hotels, 150 million a year in a Qad habit, and a large and growing population of super rich fat cats.
There is no other way of calculating GDP per capita. You use division. Anyone who took first year macroeconomics would have told you how to calculate GDP per capita. You divide the GDP with the population to get GDP per capita. Per capita means per head (per person). You divide. If I have 10 apples and I want to divide among 5 people, each person will get 2 apples. Same logic here.
I went online to find out the GDP and the population of the following countries: US, Canada and UK. The answer I got for GDP per capita I got myself by using the calculator offered on Microsoft. Now take those GDP per capita numbers and look on Google whether it's similar.
USA: 14 trillion (GDP) / 300 million people = $46,666 GDP per capita
Canada: 1.8 trillion (GDP) / 33 million people = $54,545 GDP per capita
UK: 2.4 trillion (GDP) / 62 million people = $38,709 GDP per capita
If you are thinking I want Somaliland's GDP to be low, you are dead wrong. I want all Somalis the same standards as the countries like those above. I just fixed an error that was said. Inshallah all Somalis enjoy those figures above one day. My own Somalia has a similar GDP per capita as Somaliland. I am not trying to insult anyone.
If you have further doubt, please don't hesitate to visit the following website:
I don't care about your motivation but let me start were I left from last night. The thing you need to know is that collecting real data is the most important task to calculate GDP. Registering remittance income is not the end of your work to calculate GDP, it is not even a fraction of what you need to do. For example, when remittance money comes to a country it ends up people's pockets and people use it to purchase goods and other services they need. individuals use their money, for example, to pay food and clothing and other things and then this becomes an income for a second party, a shop-owner. That shop-owner uses his new income to purchases goods and services from a third party and that becomes an income for a third party, and this process goes on and on through out the year generating incomes for numerous people who do not depend remittance directly. All of those transactions should be registered and all those incomes generated should go into GDP calculations to have a more complete picture. You need to know every single penny of income to all workers, individuals and business in the country to begin considering to work out the GDP. You also have to know many others things such as savings, consumption, balance of payments such as import/export calculations etc. To do that you need to have a government statistical agency that collect data through out the year. When you get the real GDP through this tedious work then it is fine to use that formula of dividing GDP with the population to figure out what the per capita income is. Observing remittance income and then extrapolating it to be the entire GDP of a country is not correct.
the GDP per capita = real GDP per capita = real GDP (in $ terms) / population
$500 million / 3.5 million = $142.85
hadii $30000 ay ahaan lahayd samadaa loo kaaji lahaa, think of it, it would be almost the same as the UK.
if the GDP is wrong just use that formula
hadaan khaldamayna noo sheeg.
[/quote] all you have shown is the basic formula for GDP calculation and then you have thrown a random number to equate Y. How on earth can you claim to know what Y is when you do not have any data at all about the consumption, export/import balance, government spending or private investment of the country.
Xplaya saaxib why don't you school these so call monkeys. Wallahi you make alot of sense, but would be better if you actually went back home and held seminar or even run for the post. You have bussiness or economic background, you are well qualified. If we don't rescue this country now, it will forever be ruined
Somalistan wrote:Xplaya saaxib why don't you school these so call monkeys. Wallahi you make alot of sense, but would be better if you actually went back home and held seminar or even run for the post. You have bussiness or economic background, you are well qualified. If we don't rescue this country now, it will forever be ruined
Waa runtaa. They should really go back home and create some sort of organization, like an Economic Development Board or something. If the intelligent and educated of our country don't care, what do you expect of the ignorant and corrupt?
I exchanged 1 email with Maxamed Xaashi the last decent somalilander regarding this same issues, his intial e-mail was in regard to the somalia vs somaliland talks , once i noticed his full name i realized who he was and i mentioned all the above to him. Needless to say as usual when it comes to our leaders he failed to even comment and respond . Its like talking Chines to these people , we live in 2 different world. For them talking about NGO's and Aid is more important then all the above.
The term that have recently emerged in somaliland regarding economics is the phrase " maal gashiyaal" meaning foreign investeros and tourism , that would be a disastor on our naive people , these people think so called 'investors" care to stick in the long run and make fair arrangments. The international investors are like hovering vultures they glyde in the air looking for easy pick and with the likes of Xirsi Daba Gaab and wasiir Geeljire and the rest of the clowns we are an easy pick for these international mafia's. The other one is "tourism" and remember there is no torusim without sex... period. and i dread the day these 2 come to somaliland.
You should go back home and atleast try something. The problem is as you said corrupt vultures that have manipulated the masses. There has to be a revolution because the elite that's in power have misused it but then again that won't happen because everyone is sedated on khat. Im actually going this summer and I'm planning to meet old man Silaanyo and try to talk some sense into isaga iyo wuxuu wato.
WTF is wrong with these people hadaba?
all you have shown is the basic formula for GDP calculation and then you have thrown a random number to equate Y. How on earth can you claim to know what Y is when you do not have any data at all about the consumption, export/import balance, government spending or private investment of the country.
it seemed like you all agreed on the $500mill figure so i used it