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New assessment on remittances in Somalia


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A 2012/2013 study commissioned by the Food Security and Nutrition Analysis Unit (FSNAU) of FAO highlighted the importance of remittances to the people and economy of Somalia, providing an essential lifeline to both urban and rural Somali households. The study indicated that remittance flows to Somalia are estimated at US$1.2 billion per year. The bulk of money sent is used by families to cover basic household expenses – food, clothing, education, and medical care. Due to security constraints, the 2012/2013 study did not cover central and southern parts of Somalia.

Key findings from the 2012/2013 FSNAU study include: (i) 41 percent of total surveyed households received remittances (ii) remittances reach all parts of Somali society (urban and rural as well as poor, middle and better-off wealth groups) (iii) there is high dependence on a single remittance sender (iv) remittances are used for basic household expenses (v) dependency on remittances, measured in terms of what people think the impact would be, if they lost remittances support, is very high (vi) the bulk of remittances come from Europe and North America which has important implications in terms of regulatory frameworks that facilitate or impede the flow of remittance money to Somalia (vii) there is significant secondary distribution of remittances to both urban and rural households (viii) despite the importance of remittances, there are some vulnerabilities in the system, related to the heavy reliance on a single relative to provide support and the fragility of the remittance industry to potential disruption of flows due to changes in the regulatory framework affecting Money Transfer Operators (MTOs).

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