Remittances and markets in Somalia

Each year, Somali migrants around the world send approximately $1.3 billion to Somalia. Of that, approximately $215 million comes from SomaliAmericans and Somalis in the United States—comparable to the total amount of development and humanitarian assistance that the US government sent to Somalia in fiscal year 2012 ($242 million). These flows, facilitated by SomaliAmerican money transfer operators (MTOs), represent a significant share of Somalia’s economy and help reduce Somalia’s reliance on assistance from foreign governments and international organizations. Moreover, remittances allow individuals and families to spend money based on their needs and priorities. Continued support from the Somali diaspora is essential for Somalia to successfully emerge from its protracted humanitarian emergency and political crisis, as well as to build the foundations for its long-term development.

This report by Oxfam America highlights the challenges, risks and recommendations on this remittance flow.