Faith Nyasuguta
Somalia has emerged as a significant source of remittances for Kenya and Uganda, providing them with substantial financial inflows annually. Reports from diplomatic sources indicate that Somalia contributes approximately $180 million to Kenya and $21.9 million to Uganda each year through remittances.
The data gathered from diplomatic missions in Mogadishu reveals that there are over 35,000 Ugandans residing in Somalia, collectively remitting between $50,000 and $60,000 per day. In comparison, Kenyans remit an average of $500,000 million per day from Somalia.
Nathan Mugisha, Uganda’s Deputy Head of Mission in Somalia, emphasized the need for both countries to capitalize on the opportunities available in Somalia to enhance economic benefits.
Mugisha highlighted various sectors such as agriculture, skilled labor, construction, and mining, where both Kenya and Uganda could contribute significantly. He stressed the importance of organizing and adding value to the skills of their citizens working in Somalia to maximize the economic potential of the region.
Despite the significant remittances, Mugisha noted that there is still room for growth, especially compared to the contributions from Kenyan workers in Somalia.
The diplomat acknowledged the valuable contributions of Kenyan workers in Somalia, particularly in highly skilled sectors. Although specific details were not provided, sources indicate that Kenyan nationals are engaged in various fields such as corporate services, humanitarian work, and hotel management.
With over 30,000 Kenyans currently employed in Somalia, diplomatic projections anticipate a fivefold increase in the next five years, driven by Somalia’s inclusion in the East African Community, facilitating the free movement of people within the bloc.
Somalia’s significance as a remittance destination is not captured in the latest Central Bank of Kenya report, which primarily focuses on other countries such as Tanzania, Uganda, South Africa, and Nigeria. However, Robert Mugimba, Uganda’s Counsellor at the Embassy, emphasized the growing importance of Somalia in terms of labor exports.
He highlighted Somalia as the second-largest destination for Ugandan workers after Saudi Arabia, with the number of workers increasing significantly following the establishment of a joint permanent commission between Uganda and Somalia in August 2022.
The increasing trade and labor exchanges between Kenya, Uganda, and Somalia highlight the immense economic potential within the region.
As these countries continue to strengthen their partnerships and explore opportunities for collaboration, they can leverage Somalia’s growing economy to enhance trade relations and foster mutual prosperity.
By investing in key sectors and facilitating the movement of people and goods across borders, East African nations can further stimulate economic growth and development in the region.
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