Somaliland Economy
The official Somaliland currency is the Somaliland shilling (SlSh). It is regulated by the Central Bank of Somaliland which was constitutionally established in 1994.
The most important sector in Somaliland is livestock production which is predominately pastoral and agro-pastoral in Somaliland employing over 70% of the population. Livestock is the major export of Somaliland accompanied by its by-products i.e. hides and skins while the country heavily depends on imports of food, fuel and manufactured products. Livestock production in Somaliland contributes to 60% of GDP and around 85% to foreign export earnings (Somaliland National Development Plan, 2012 – 2016). Somaliland’s agricultural sector accounts for around 17% of the economy making it the second most important sector.
Somaliland’s economy is also heavily dependent on remittances sent by the global Diaspora which equates to around $1 billion per annum.

Growth Rate (3.5 %)
Taking 2012 as a starting point, the country’s budget has been on the rise indicating a healthy, overall growth despite the severe drought in 2015 and the livestock export ban later in 2017.

GDP (Gross Domestic Product)
2,573 million US Dollars (2917 EST

GDP- per capita

675 US Dollars

Agriculture

In Somaliland, farming contributes between 8 % and 15% of the GDP, as livestock production and exports are the backbone of the economy and the biggest hard currency earner for the country. Due to the importance of livestock, the Somaliland government treats it as a different sector and has a separate ministry dedicated to livestock.
It is estimated that about 10% of the land is suitable for agriculture.
Despite being erratic and often scanty, there are nevertheless two main raining seasons.
The GU or spring (April to June) and Deyr or autumn (September to October), in between these two rainy seasons there is also Karan (late July through September) most occur in the western regions.
The farming in Somaliland is predominantly subsistence in nature. The principal grain crop grown under rain fed conditions is sorghum, followed by maize; and both crops are grown primarily for household consumption by small scale farmers.
Fruit and vegetable crops, which are relatively small, are mainly grown for commercial purposes and the principal commercial crops are tomatoes, lettuce, onions, watermelon, peppers, cabbages., oranges, lemons and papaya.
Rain few farming accounts for 90 % of the total area cultivated, while the area under irrigation constitutes only 10% supporting 4,000 farm families. The sector is dominated by smallholder farmers who own farms ranging from 2-30 hectares in the area. The average farm size is approximately 4 hectares.
During the raining season, irrigated farms make good profits because the supply in the vegetable and fruit markets is low in this period. The shortfalls are usually filled by imports from neighbouring countries like Ethiopia and Somalia.
In recent years, the cultivation os watermelon has emerged as ab important source of income for the farmers. Presently, watermelon is the only fruit crop that is exported successfully to Djibouti.

Livestock

Livestock is currently the leading economic sector in all of Somaliland. Livestock production accounts for up to 65 % of the gross domestic product (GDP).
Based on 1998 FAO estimates of livestock numbers and past growth rates, Somaliland has about 1,69 million camels, 0.40 million head of cattle, 8.4 million goats and 8.75 million sheep in 2011.
The Sool, Sanaag and Togdheer regions account for about 75% of all livestock.
Somaliland’s major livestock exports are sheep and goats, accounting for 91% of all animal exports.
In 2010, a total of 2,352 million sheep and goats were exported through the Berbera Port. Of this total, 1.612 million (69 %) were exported between September and November for the Hajj festivities.
Assuming an average export price of US $ 70, the estimated total value would be over US $160 million. With government taxes at around US$3.60 per head, this means tax revenue of around US 8.5 million or 10% of the Somaliland government’s total revenue.
Somaliland, and to a certain extent the other exporters from the Horn of Africa, depends on only a few countries for exports. For example, out of the 2.585 million head of sheep and goat exported through the Port of Berbera in 2010, about 78% went to Saudi Arabia, 20% to Yemen and the rest to Egypt and Oman.
With increased investment, smart regulation, infrastructure development, sector coordination and improved branding, Somaliland has ample opportunities to capitalize on growth of the livestock sector in the Middle east and other regions of the world, while supporting the growing local demand.

Fisheries

The western coast has wide sandy beaches while the eastern coast has relatively narrow sandy beaches broke at intervals by rocky outcrops and cliffs. The continental shelf on the eastern coast is between 5to 10 kilometers wide when measured at the 200m depth line. The shelf becomes wider-reaching around 30-50 kilometers near Zeila town area at the border with Djibouti.

The average annual value of the potential fish catch is estimated at US$ 32 million, assuming a freight on board (FOB) price of US$ 2 per kilogram based in the current practices and sales in the gulf markets as reported in a variety of United Nations and World Bank reports (JNA, Productive sectors report, September 2007). As per recent estimates, the yearly sustainable catch available to Somaliland fishermen could be around 40,000 metric tons.
Somaliland is endowed with a rich coastline along the Gulf of Aden and Indian Ocean. These waters are home to an extensive list of fish species, including various species of tuna, albacore, lobster, swordfish, sharks and many others.
The estimated catch by a local Somaliland fishermen is around 15,000-20,000 metric tons annually.

Extractives and Energy

Somaliland is endowed with yet-to-be- tapped abundance of gemstones, hydrocarbons and mineral resources. The resources need to be extracted to alleviate the country from its economic recess. There is already an initiative taking momentum to have the resources extracted but the efforts are hampered by the absence of intrepid international partners to spearhead the county’s international recognition without which no meaningful, multilateral agreements can be reached.
Somaliland strongly urges the international mining companies to invest in the country’s mining sector.

Energy

The principal sources of energy in Somaliland are of two main origins- Imported petroleum and local biomass resources. Petroleum is imported in the form of refined diesel, o petrol and aviation gas, all of which are used for transportation and electric power generation.
Other imported petroleum products include Kerosene and natural gas which are used for cooking.

Since the declaration of independence in 1991, Somaliland electricity system was rebuilt and is now operated almost entirely by independence power producers each supplying areas in its neighbourhoods.
Some of these are dedicated IPPSs who sell electricity as a central part of their business model but many others need electricity generation for their own business activities and sell the excess to nearby customers.
While over 20 IPPs operate in Somaliland, there has been significant consolidation of IPPs in recent years with many coming together to form one company to deal with inefficiencies and duplication. This trend is emerging in the capital Hargeisa as well as other cities.

Hydrocarbons

Somaliland is one of the few high potential yet underexplored areas around the globe.
The existence of oil and gas in Somaliland was known since the beginning if the last century, through oil seepages in several parts of the country confirming the working petroleum system. It is only the finding of the big structures and the discovery of commercial accumulations that have so far eluded the limited and intermitted exploration and the small number of drilling over the length of time.
While petroleum exploration interest of the country started in 1912 when the oil seep at DhagahShabel, 38 kilometers south-east of Berbera, recent exploration has seen the Ministry of Energy and minerals formulate and facilitate a multi-client 2D seismic project in which it presented to all the international oil companies which have production sharing agreements with the government.
The current scheme of Somaliland oil and gas blocks consists of 24 blocks of both onshore and offshore. Only a quarter of that is presently held by International Oil Companies that have exploration and production sharing agreement with the government.
Many of these blocks have a great deal of potentiality and open for investors.

Minerals

Based on the geological and geological and geochemical surveys that have been conducted, the mineralized zones of Somaliland are highly prospective to host a wide range of minerals.
Studies conducted have recorded the occurrences of precious metals, heavy minerals, non-metallic minerals and gemstones in many areas across the regions of the Republic of Somaliland.
The occurrence of precious metals including platinum, silver and gold prospect area was discovered in the region of eastern Sanaag fueling increased artisanal activity in the area.
Recorded occurrence of prospects in the occurrence for base metals in the country include Zinc, lead, copper, iron, titanium, manganese, beryllium, columbite-tantalite, chromium, molybdenum, tin, nickel, vanadium, ilmenite and bismuth.
Furthermore, mineral sandsdeposits along the coastal areas of Somaloiland, east and west of Berbera have the potential to contain commercially important titaniferous heavy minerals that can easily be mined. Heavy accumulation in these sands include ilmenite, magmetite, rutile, monazite, and zircon.
Somaliland is also endowed with significant deposits of non-metallic industrial merals such as gypsum, mica, feldspar, kaolin, and Sapiolite. Decorative stones such as jade which are currently mined and quartz crystals are additionally available. Granite, limestone, marble, travertine, quartz based stones are also available in Somaliland.
Gemstones

As an extension of the Mozambique belt which hosts many types of gemstones in Kenya, Tanzania and Madagascar, Somaliland’s mineralised zones contain a variety of gemstones that thus far have only been mined in small scale through artisanal activity.
Gemstones occurrences found in Somaliland include emerald, ruby, sapphire, aquamarine, garnet, opal, amethyst and topaz.

Salt

Somalilandi is blessed with abundant deposits of salt that has potential for investment and export. Salt is currently mass-produced by evaporation of seawater or brine well and salt lakes.

Coal

Geological field mapping along with available geological and drilling data suggest that Somaliland has favourable stratigraphy and structure for coal deposits. Lignitic to sub-bituminous coal deposits with ages from Jurassic to Oligocene-miocene occur in various locations across the country including Hed-Hed valley south of Onkhor which has the greatest thickness and highest quality, Guveneh hills north of Las Dureh and Daban Basin south east of Berbera.