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ABSTRACT
This article considers the relationship between livestock taxation and local state formation dynamics in the northern Somali territories. While the economic importance of livestock in Somalia is undisputed, its significance as a source of revenue and legitimacy for public administrations and competing state-building projects has been overlooked. Drawing on fieldwork in Somaliland’s main livestock markets and the Berbera corridor, we highlight the interplay between public administrations that seek to maximize livestock revenue and traders who attempt to minimize taxation. State attempts to capture these ‘revenues on the hoof’ by both coercive and consensual means, shifting livestock trading routes and fluctuating animal trading volumes produce different taxation patterns across the Somali territories. As a result, fiscal contracts between livestock traders and public administrations are marked by various degrees of reciprocity and coercion.
Acknowledgements
The first author is indebted to research participants in Somaliland who shared their valuable time to answer sensitive questions about taxation and livestock trading. The authors thank Jason Mosley and two anonymous reviewers for their thoughtful comments on earlier versions of this paper. Research for this article was funded by the Danish Consultative Research Committee for Development Research (FFU) as part of the GOVSEA project.
Disclosure statement
No potential conflict of interest was reported by the author(s).
Notes
1 Schumpeter, “The Crisis of the Tax State”; Tilly, “Coercion, Capital and European States.”
2 Mann, States, War and Capitalism; Cooper, Africa Since 1940; Schouten, “Roadblock politics in Central Africa.”
3 Little, Somalia: Economy Without a State.
4 Menkhaus, “State Collapse,” 51.
5 Leeson, “Better off Stateless.”
6 Desta, Sebsibe, and Bleich, “Assessment of Cross Border Informal Livestock Trade.”
7 Holleman, The Socio-Economic Implications, 4.
8 Mubarak. “The ‘Hidden Hand’ Behind the Resilience”; Little, Somalia: Economy Without State; Leeson, “Better Off Stateless”; Powell, Ford, and Nowrasteh, “Somalia After State Collapse.”
9 Little, Somalia: Economy Without State; Menkhaus, “State Collapse”; Webersik, “Mogadishu: An Economy Without a State.”
10 Keen, “Taxation and Development—Again.”
11 Schumpeter, “The Crisis of the Tax State.”
12 Fjeldstad and Therkildsen, “Taxation, Coercion and Donors.”
13 Keen, “Taxation and Development.”
14 Moore, “Revenues, State Formation”; Bräutigam, “Introduction: Taxation and State Building.”
15 Meagher, “Taxing Times.”
16 Moore, “Revenues, State Formation.”
17 Lund, “Twilight Institutions.”
18 Hansen and Stepputat, States of Imagination.
19 Hoffmann, Vlassenroot, and Marchais, “Taxation, Stateness and Armed Groups.”
20 Meagher, “Taxing Times.”
21 Eubank, “Taxation, Political Accountability and Foreign Aid.”
22 Ahmad, “The Security Bazaar.”
23 Teka and Azeze, “Cross-Border Trade”; Umar and Baulch, “Risk Taking for a Living”; Kefale, “Shoats and Smart Phones.”
24 Little, Somalia: Economy Without a State; Tempia et al., “Mapping Cattle Trade Routes.”
25 Majid, Livestock Trade.
26 Stepputat and Hagmann, “Politics of Circulation,” 31–2.
27 Hagmann and Stepputat, Corridors of Trade and Power.
28 Pankhurst, “The Trade of the Gulf of Aden Ports”; Umar and Baulch, “Risk Taking for a Living.”
29 Samatar, Salisbury, and Bascom, “The Political Economy.”
30 It takes 3, 5, 10 and 11 days for livestock that has left Berbera, Bossaso, Mogadishu, and Kismayo ports, respectively, to arrive at the port of Jeddah in Saudi Arabia, the most important market for Somali livestock export.
31 Ahmed, “The Heritage of War and State Collapse.”
32 Holleman, The Socio-Economic Implications; Majid, Livestock trade; Eid, “Jostling for Trade.”
33 Statistics on exports from Berbera port from FSNAU or from Somaliland government sources do not state the origin of livestock.
34 Stepputat and Hagmann, “Politics of Circulation.”
35 For the definition of different markets, see Umar and Baulch, “Risk Taking for a Living,” 21.
36 Samatar, Salisbury, and Bascom, “The Political Economy,” 92.
37 Interview, livestock trader, Hargeisa, March 2018.
38 Little, Tiki, and Debsu, “Formal or Informal, Legal or Illegal,” 407.
39 Musa and Schwere, “The Hidden Tactile Negotiation.”
40 Ibid.
41 Senior in terms of age, number of years in the profession and the size of the livestock they sell.
42 Samatar, Salisbury, Bascom, “The Political Economy,” 92.
43 Majid, Livestock Trade, 5.
44 Little, Tiki, and Debsu, “Formal or Informal, Legal or Illegal.”
45 Interview, truck operator, Hargeisa, March 2018.
46 Interview, truck operator, Hargeisa, March 2018. As mentioned by two interviewed truck-owners, getting Ethiopia number plate could cost up to US US$8000 as of late 2018.
47 Afrol News, “Djibouti, Somaliland in Bitter Port Feud,” 3 January 2010. https://www.afrol.com/articles/23556 [Accessed 25 September 2019]; Majid, Livestock trade.
48 Eid, “Jostling for Trade.”
49 Somaliland press cited in unpo.org, 2019.
50 Musa, From Trust to Oligopoly.
51 Umar and Baulch, “Risk Taking for a Living,” 37.
52 Hagmann and Hoehne, “Failures of the State Failure Debate.”
53 Lewis, “Integration in the Somali Republic.”
54 Hoehne, “The Rupture of Territoriality.”
55 Leonard and Samantar, “What Does the Somali Experience.”
56 Bradbury, “Living with Statelessness”; Hoehne, “The Rupture of Territoriality.”
57 Bradbury, Becoming Somaliland; Bradbury, Abokor, and Yusuf, “Somaliland: Choosing Politics over Violence.”
58 Hoehne, “Mimesis and Mimicry.”
59 The Africa Research Bulletin (2012) counted the announcement of ‘at least thirty semi-regional states’ between 2006 and 2012.
60 Hoehne, “The Rupture of Territoriality,” 1380.
61 Eubank, “Taxation, Political Accountability and Foreign Aid.”
62 UNSC, Letter dated 2 October 2018 from the Monitoring Group on Somalia and Eritrea addressed to the Chair of the Security Council Committee pursuant to resolutions 751 (1992) and 1907 (2009) concerning Somalia and Eritrea.
63 Majid, Livestock Trade; Hoehne, “The Rupture of Territoriality.”
64 Balthasar, “Somaliland’s Best Kept Secret”; Phillips, “Political Settlements and State Formation.”
65 Salal, Daadmadhedh, Ayn, Saraar, Makhir, and Hawd in 2008, and in 2014 Haysimo. Once a new region was created, new districts were also established.
66 “Madaxweyne Daahir Rayaale Kaahin oo manta magcaabay lix gobol iyo 14 degmo” [President Rayale Greates Six Regions and 14 Districts]. Accessed August 15, 2019. https://somlandnor.wordpress.com/2008/03/22/madaxweyne-d-rayale-kahin-oo-maanta-magacaabay-lix-gobol-oo-cusub-iyo-14-degmo/.
67 Sool (Lasanod) Sanaag (Badhan), Ayn (Buhodle) and Hayland (Dhahar) regions of Puntland overlap with Sool (Lasanod), Sanag (Erigavo), Ayn (Buhodle), Makhir (Badhan) and Haysimo (Talex) of Somaliland.
68 Hoehne, “Between Somaliland and Puntland.”
69 Chanie, “Clientelism and Ethiopia’s Post-1991 Decentralisation.”
70 Hagmann, “Challenges of Decentralisation.”
71 Araabinews, “Degmooyin cusub oo lagu daray ismaamulka Somalida toobiya (DDSI) waa kuwee” (New Districts in the Somali Region of Ethiopia), 2016. Accessed September, 2019. https://araabinews.com/degmooyin-cusub-oo-lagu-daray-ismaamulka-somalida-itoobiya-ddsi-waa-kuwee/.
72 Korf, Hagmann Emmenegger, “Re-Spacing African Drylands.”
73 Haas, An Overview of Municipal Finance.
74 Interview, former Ministry of Finance Director, Hargeisa, March 2018.
75 The constitution of the Republic of Somaliland. 2001.
76 See Lochery, Generating Power on how Somaliland government taxes electricity providers.
77 Balthasar, “Somaliland’s Best Kept Secret.”
78 Phillips, “Political Settlements and State Formation.”
79 Ibid.; Musa and Horst, “State Formation and Economic Development.”
80 de Waal, “Class and Power in a Stateless Somalia”; Jhazbhay, “Somaliland’s Post-War Reconstruction.”
81 Costagli, Mugunieri, and Wanyoike, “A Rapid Appraisal.”
82 Interview, former Ministry of Finance Director, Hargeisa, June 2018.
83 Sales tax for small ruminants is 2000 SolSh, 6000 for cattle, and 10,000 for camels.
84 Interview, Mayor of Burao, Burao, April 2015. During data collection for this study the same Mayor was still in office and publicly complained about this revenue sharing formula.
85 Balthasar, “Somaliland’s Best Kept Secret,” 223–4.
86 Ministry of Finance, customs Export valuation list (2018).
87 In 1994, the official exchange rate was 1500 shillings/US$ against 10,000/US$ in 2018.
88 Musa, From Trust to Oligopoly.
89 Green and Jamal, “Somalia: Paradoxes of Private Prosperity.”
90 Hargeisa and Burao markets specialize in small ruminants, 80% of livestock traded in these markets are small rumiannts, therefore, we focused on small ruminants. Togwajale border market specializes in cattle and we collected data from cattle only.
91 This figure shrinks during the export livestock ban season.
92 This fee is locally also referred to as qashinxaad or garbage collection fee.
93 A six-ton (shamboo) truck load has the capacity to hold 150–200 small ruminants. An eight-ton (sideedboole) truck has a load capacity of some 200–250 small ruminants while the twelve-ton (waraad) truck loads 350–400 small ruminants.
94 Interview, Burao market head, Burao, June 2018.
95 Interview, Somaliland decentralisation and election expert, Hargeisa, 2018.
96 Interview, Burao market head, Burao, June 2018. The first author observed the taxing officer issuing receipts for these commission.
97 Olivier de Sardan, “Practical Norms.”
98 Interview, senior livestock broker, Burao, August 2018. Al-shabaab taxes livestock trekked between Bay and Beledweyne at USD$0.2 per head of animal. In contrast, a recent study reported that al-Shabaab’s Finance Department taxes commercial livestock at US$5, 3 and 2 per head of camel, cattle and small ruminants, respectively, at checkpoints. Hiraal Institute, The AS Finance System.
99 Interview, livestock exporter, Hargeisa, August 2018.
100 Interview, livestock exporter, Hargeisa, June, 2018; Interview, senior dilaal, Burao, July 2018.
101 Interview, senior broker, Burao, July 2018. The same interviewee stated that administrative posts in the Somali Regoinal State had collected less revenue since the change of national leadership, referring to the new Ethiopoian Prime Minister Abyi Ahmed who came into office in April 2018. The checkpoints are Afar Iridood, Bookh, Laandheer, Qalloocan, and Ballidhiig.
102 Interview with truck operators, Hargeisa, March, 2018.
103 Interview with female truck owner/livestock trader who bought the old truck number, Hargeisa, April 2018. The truck was expropriated in 2016.
104 Interview, truck owner/livestock trader, Hargeisa, April, 2018; Umar & Baulch (2007) reported a similar complaint due to Ethiopia’s criminalization of the trade system.
105 Eid, “Jostling for Trade”; Stepputat and Hagmann, “Politics of Circulation.”
106 Mohamed, “The Political Ecology of Colonial Somaliland.”
107 Little, Somalia: Economy Without State, 9.
108 Moore, “Revenues,” 311.
109 Interview, livestock exporter/wakiil, Hargeisa, April 2018.
110 Musa, From Trust to Oligopoly.
111 Interview, veterinary professional, Hargeisa, March 2018.
112 Tendler, “Small Firms, the Informal Sector.”