Somalian lifeline cut off by suspension of remittance services

Somalia-Remittances

China Central Television (CCTV)

Most of the major U.S. banks have ended remittance services to Somalis after new regulations were passed to stop money from getting into the hands of terrorists such as Somalia’s Al Shabaab. However, funds sent back home to Somalia are crucial for many families and businesses in a country that lacks a proper financial system from years of fighting.

Daud Aweis, spokesperson of the Somali President describes the impact of the new decision as a “disaster” to the lifeline of many Somalis. “All the institutions collapsed and many Somalis, the hardworking Somalis who are living abroad were the ones who are sending money back home. So this is considered as a lifeline, and whenever it is cut like now, it is going to be a disaster to the lives of many Somalis,”said Aweis.

Aweis said the Somalian government, especially the Somali Central Bank is now functioning properly and monitoring money laundry problems. The problem of fearing funds falling to the wrong hands should be solved by “cooperating with the Somali National Bank to strengthen the capacity of the bank,” rather than “disrupting the operation of the Central Bank.” “What is needed is to have cooperation from inside and the international banks to make sure that all these problems are addressed,” said Aweis.

About 40 percent of all Somali families rely on remittances which are estimated to amount to a total of 1.3 billion U.S. dollars annually. Aweis said suspension of remittance service will not only affect the economy, but also escalate security problems. So the Somali government is “establishing the institutions in Somalia and to create jobs.” And to restore the lifeline of many Somalis, Aweis said the government is looking for alternatives and hopefully to find a solution soon. “But we still calling the American government and the American banks to cooperate with the Somali government and Somali banks to make sure that this procedure is addressed together and also we have a solution to this problem and the services of the Somali remittances are allowed to work inside Somalia and also in US banks,” said Aweis.

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