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UN investigates Al-Shabaab's financing and complex taxation systems in Somalia

By Abuga Makori in Nairobi , Garowe Online

NEW YORK, USA - The United Nations Security Council has launched investigations to complex Al-Shabaab taxation systems, a top official has said, even as the militants continue to cause havoc within Somalia.

In a strategy aimed at sustaining their operations, the militants have reverted to a mafia-style taxation tactic, targeting informal sectors within Somalia, UN Panel of Experts report noted.

In an email correspondence with Garowe Online, Matthew Rosbottom, a member of the experts, said UNSC was mandated them to investigate "financing" besides coming up with a "comprehensive" mapping of Al-Shabaab's taxation system.

Pursuant to resolution 751 of 1992, the UNSC said, the experts will "conduct an analysis of all of Al-Shabaab’s revenue sources, their methods of storage and transfer, and mapping of illegal taxation systems, and to provide recommendations".

Financing of Al-Shabaab has remained a major puzzle for the UN and Somalia partners, derailing the fight against the Al-Qaida linked group, whose attacks have resulted in several deaths.

Although the group's activities remain minimal within the capital Mogadishu, it has, however, managed to execute lethal attacks within the capital and other towns across the country, police said.

While noting the danger Al-Shabaab poises, the UN condemned their "extraction of revenue from natural resources in addition to the charcoal trade, including the taxing of the illicit sugar trade, agricultural production, and livestock".

UNSC also noted with "concern" Al-Shabaab's ability to store and transfer resources, and requested the Panel, with input from FGS and UNODC, to expedite investigations, the official said.

Al-Shabaab's expanded taxation in Mogadishu

Somalia capital Mogadishu has borne the brunt of Al-Shabaab sophisticated taxation, leading to unprecedented protests in Nairobi by businessmen during a press conference.

According to the businessmen who spoke in confidence for fear of Al-Shabaab reprisal since "they know our businesses", the group has expanded its tax empire in Mogadishu.

Sources within the Somalia Chamber of Commerce and Industry said the terrorist organization collects $4 million to $5 million a month.

“Al-Shabaab is taxing every business by force,” they said referring to port importers, exporters, transporters, and shopkeepers in Somalia.

This, they argued, supports terror activities within Somalia and across the borders, a move that could escalate should neighbors fail to intervene with urgency.

“Authorities must pay attention to what is happening in Mogadishu. History will judge them harshly if they give up their role (of helping Somalia). Because they may invite attacks on their soil,” the traders had said in Nairobi.

Although the militants were flushed from the port city in 2011, they have made significant inroads, using unparalleled infiltration systems for the purpose of taking over Mogadishu albeit secretly, the businessmen claimed.

Kenya puts measures to curb smuggling

While Mogadishu residents are decrying the return of Al-Shabaab, Kenya has already raised a red flag about Al-Shabaab financiers, putting stringent measures to curb illicit trade across the border.

For years, Kenya's intelligence agencies have linked certain businesses to Al-Shabaab networks, although it has taken long to nab the perpetrators.

President Uhuru Kenyatta last month said, "we are tracking down their financiers until we completely close their revenue channels".

Already, the crackdown has been extended to Dadaab refugees camp in Garissa, where unscrupulous traders are said to be smuggling goods to the country in collaboration with Al-Shabaab.

Proceeds from such goods are sent back to Somalia to Al-Shabaab, who in return use them for purchase of weapons besides paying for service of fighters, Dr. Fred Matiang'i, the interior minister said.

The East Africa nation has often been targeted by the Al-Shabaab militants, who have waged numerous attacks especially in the northeastern region and at times in Nairobi.

Al-Shabaab's infiltration in FGS

The UN's efforts to trace the group's financing comes at the time FGS is under pressure over alleged links with the militants.

A number of intelligence briefs expose massive infiltration of Al-Shabaab in Somalia government, a move that has partly impaired efforts to completely degrade them.

Abdalla Ahmed Ibrahim, director of the East African Centre for Research and Strategic Studies, says the infiltration makes it difficult for partners to share information with NISA.

NISA, Somalia's spy agency, is also said to be harboring dozens of Al-Shabaab sympathizers, further rendering the intelligence network worthless.

According to the traders, Somalia is eroding gains made under former President Sharif Sheikh Ahmed, who is credited for flushing Al-Shabaab out of the capital.

“We are now rolling back the gains we had made. The common joke here, nowadays, is that we have an air force but no ground force," a member of the chamber said.

"This is because President Mohamed Farmajo cannot go from one end of Mogadishu to the other without flying,” he added.

But more often than not, Farmajo has often rebuffed claims he's working with the terror group, accusing opponents of maligning his reputation.

The exact number of Al-Shabaab active fighters is estimated to be around 6,000 with most of them now hiding in remote villages of Central and Southern Somalia.