In recent years, President Hassan Sheikh Mohamud, who was elected as the President of Somalia in 2022 for his second term, has faced serious allegations concerning Public land grabbing, corruption, centralization of government control and nepotism. President Hassan consolidated power by undermining and assuming the authority of the Council of Ministers, the Federal Parliament, Mogadishu Municipality, and the Judiciary. These accusations have ignited significant controversy and debate both within Somalia and among the international community.

Under President Hassan Sheikh Mohamud’s administration, a series of policy decisions concerning the outsourcing of Inland Revenue collection, municipality hygiene services, and the introduction of additional taxes have sparked widespread debate and criticism across Mogadishu. These measures, intended to improve efficiency and public services, have nonetheless faced significant backlash due to concerns about transparency, corruption, accountability, and the excessive burden on citizens.

Introduction of Additional Taxes in Mogadishu

The strike by businesspeople in Mogadishu reflects deep-seated frustrations over recent economic policies and perceived corruption within the government and its affiliated entities. The immediate trigger for the strike was the introduction of a new 5% Value Added Tax (VAT) that was implemented without prior consultation with the business community. This move has been seen as yet another burden on businesses already struggling under heavy taxation.

In addition to the VAT, businesses are also protesting against what they consider to be excessive fees at Mogadishu’s port, one of the most vital economic lifelines in Benadir region. The port is crucial for the import and export of goods, and any disruptions there can have a widespread impact on the economy. Businesspeople are particularly angry about the high charges imposed by certain companies, which they allege have close ties to the presidential family.

These companies are accused of exploiting their connections to levy exorbitant fees under the guise of services such as quality control and scanning. For instance, the charge of $80 per container for quality control which in effect never offers any service at all and $40 for unnecessary scanning is seen as unjustified and a significant financial strain on businesses, particularly small and medium-sized enterprises. The perception that these fees are being funneled into the pockets of well-connected individuals – the President’s daughter in-law is in charge of the quality Control and the corrupt Adoon family in charge of the scanner scams. This has only heightened the sense of injustice and corruption that has no bounds.

The strike is not just a protest against the VAT and port fees but also a broader expression of dissatisfaction with what many see as systemic corruption and favoritism within the Somali government. The business community is demanding that these companies be removed and that a more transparent and fair system be implemented.

The fact that the strike has led to the closure of businesses across Mogadishu and even the shutdown of port operations is a testament to the seriousness of the situation. Today not a single ship is docked at Mogadishu Port. The port’s inactivity could lead to delays in the importation of essential goods, causing shortages and price increases, which could further exacerbate the economic difficulties faced by ordinary citizens.

The strike also raises questions about the government’s relationship with the business community and its approach to economic policy. The lack of consultation before implementing the VAT suggests disconnect between the government and the private sector. If this strike continues or if the government fails to address the grievances of the business community, it could lead to longer-term economic instability and a loss of confidence in the government’s ability to manage the economy effectively. This could pave the way for the big companies to disinvest from Mogadishu and instead invest in Kenya or Dubai.

The strike is a critical moment in Mogadishu, reflecting broader issues of governance, economic policy, and the relationship between the government and its citizens. The outcome of this strike could have significant implications for the future of Somalia’s economy and its political landscape.  Let us not forget the fact that Mogadishu has no functioning government. The business people are the only people who build roads, help the poor and contribute when a calamity happens. President Hassan and his friends make money out of the misery of the masses. A well-known business man in Mogadishu said “that President is not mentally fit at all because all he is thinking revolves around money and international travel and to that end will sign if you draft a contract that stipulates company XX is awarded to tax the new born babies provided he gets his cut”.

All the Private Hospitals and pharmacists also joined the protest against the ne 5% VAT and threaten that they will close all private health services if the President continues pushing the tax.

Outsourcing of Inland Revenue Collection

One of the most contentious policies has been the outsourcing of Inland Revenue collection to private firm. The government has argued that this move is necessary to enhance revenue generation and reduce corruption within the tax collection system. By involving private companies, the administration believes it can leverage modern technologies and expertise that the government may lack, thereby increasing tax compliance and overall revenue.

However, this decision has been met with significant opposition. Critics argue that outsourcing such a critical function to private entities poses serious risks, including potential abuse of power, lack of oversight, and the diversion of public funds. Concerns have also been raised about the transparency of the selection process for these private firms and the terms of their contracts with the government.

The presidential family connected company that is awarded the contract prints their own cash receipts as opposed to the official cash receipts issued and registered by the accountant General. This company is given carte blanch to deposit in the central bank account any amount they decide to deposit after they deduct their 30% share. As long as they aren’t using the official receipts there is no way to find out how much they really collected. This Month, its reported that the Director of Revenue at the Ministry and the Deputy Minister Xaange fought inside Mr. Faisal’s office over their shares of the loot.

There is no thread of logic in this scheme because the government is getting far less revenue at the point of collection due to the unofficial receipts and on top of that the government is paying 30% to the company and still paying the Inland Revenue Staff of the Ministry. I wonder the benefit President Hassan is driving from appointing an unprofessional person as Minister of finance. When the blind can see the roaring corruption that is going through the roof, I wonder why the President failed for so long to take notice of the unparalleled corruption his family members are nurturing with pleasure.

Moreover, there is an anxiety that the involvement of profit-driven companies in tax collection could lead to aggressive enforcement practices, disproportionately affecting small businesses and low-income individuals. This has fueled public resentment and accusations that the government is prioritizing enriching his clan’s men over the welfare of its citizens.

Outsourcing of Municipality Hygiene Services

In a similar vein, the outsourcing of municipality sanitation services and awarding the contract to a family member called Mr. Yasin Dhagool, who is an Hotelier, has generated controversy. The administration has justified this move by pointing to the chronic inefficiency and lack of capacity within public sector agencies responsible for these services. Outsourcing, they argue, will lead to   improved public health, and better-managed urban environments.

However, opponents of this policy cite several concerns. They argue that outsourcing has led to inconsistent service delivery, with private contractors often failing to meet the required minimum standards. The critics rightly argue that the contract have been awarded to a company with close ties to the political elite, raising questions about cronyism and corruption.

The privatization of these essential services has also led to job losses among municipal workers, further exacerbating economic hardship in a country already struggling with high unemployment rates. This has sparked protests and labor disputes, with calls for the Mayor of Mogadishu to take back control of these services to ensure they are delivered equitably and effectively.

Nepotism Accusations

In addition to land grabbing, President Hassan Sheikh Mohamud has also faced allegations of nepotism. Critics accuse him of appointing family members, close relatives, and loyalists to key government positions, often sidelining more qualified candidates. This practice, they argue, undermines the principles of good governance and meritocracy, contributing to the erosion of public trust in state institutions.

The most notable examples include the appointment of individuals with personal or familial ties to the President in critical roles within the executive branch, security forces, and diplomatic missions. Detractors claim that these appointments have not only fostered corruption but also weakened the effectiveness of government institutions by placing loyalty above competence.

Land Grabbing Accusations

One of the most contentious issues surrounding President Hassan Sheikh Mohamud has been the allegations of land grabbing. Critics claim that under his administration, there has been a systematic effort to seize valuable land in Mogadishu, often at the expense of ordinary citizens and local communities. These lands, they argue, have been appropriated by the President or by individuals with close ties to the government, including powerful business interests such as  Adoon family and political allies.

The land grabbing allegations have particularly focused on the displacement vulnerable communities, including internally displaced persons (IDPs) and those living in informal settlements. Many of these individuals have been forcibly evicted without compensation or alternative housing, leading to increased social unrest and humanitarian concerns.

Impact and Public Perception

The accusations of land grabbing and nepotism have had significant repercussions on President Hassan Sheikh Mohamud’s reputation and administration. They have intensified public skepticism and discontent, leading to protests and criticism from all sections of the citizens, civil society organizations, and even some members of the international community.

These issues have also raised broader concerns about governance, transparency, and accountability in Somalia. As the country continues its journey toward stabilization and development, addressing these allegations remains crucial for fostering public trust and ensuring that the government’s actions are aligned with the principles of justice and equity.

By Abdullahi Ahmed Nor

Email: abdullahinor123@gmail.com