Abstract

This paper examines Somalia’s contemporary economic and political status within the East African Community, revealing a nation navigating the profound tension between fragile statehood and regional integration. Economically, Somalia presents a paradox of modest growth projections—3.3 percent in 2026—against a backdrop of extreme import dependence reaching 99 percent of GDP, the highest in Africa. Inflation has stabilized in the 5-6 percent range, but structural vulnerabilities persist: food comprises 46 percent of the consumption basket, and foreign aid disruptions threaten macroeconomic stability. Politically, Somalia operates on multiple fault lines simultaneously—a constitutional crisis between federal and state governments, an ongoing insurgency by Al-Shabaab, a parliamentary legitimacy vacuum, and escalating geopolitical competition as external powers including Turkey, Egypt, and the UAE vie for influence. The February 2026 authorization to issue East African Community passports represents a significant diplomatic milestone, yet this institutional integration proceeds alongside centrifugal forces that threaten state cohesion. This paper argues that Somalia’s status embodies the contradictions of simultaneous integration and fragmentation: as the country deepens ties with East Africa, domestic political fractures widen, raising fundamental questions about whether regional membership can serve as an anchor for stabilization or merely a parallel process disconnected from on-the-ground realities.

1. Introduction

Somalia occupies a distinctive and deeply paradoxical position in East Africa. In March 2024, it formally joined the East African Community as the eighth Partner State, depositing its instrument of ratification of the Treaty of Accession at the bloc’s headquarters in Arusha, Tanzania, after a decade-long bid for membership . By February 2026, the country received authorization to issue East African Community passports—a tangible symbol of integration that promises to facilitate mobility, trade, and people-to-people ties across the region .

Yet this forward movement toward regional integration occurs alongside profound domestic fragmentation. In the same month that Somalia aligned its travel documentation with EAC standards, its parliament descended into chaos as opposition MPs physically blocked sessions to protest constitutional amendments they view as an illegal power grab . Federal states and the central government operate in an atmosphere of mutual suspicion. Al-Shabaab continues to exploit governance vacuums. And international partners find themselves managing what one African Union diplomat described as a “slow-motion collapse” .

This paper investigates this fundamental tension between integration and fragmentation. Drawing on recent economic data, political analysis, diplomatic records, and security assessments, it examines Somalia’s dual status: as a new EAC member seeking the benefits of regional integration, and as a state approaching what analysts term a “structural breaking point” . The analysis proceeds in three parts. Section two examines Somalia’s economic performance, structural vulnerabilities, and prospects under IMF engagement. Section three analyzes the multi-front political crisis—constitutional deadlock, federal-state relations, parliamentary dysfunction, and the ongoing security threat. Section four considers Somalia’s regional integration trajectory and the geopolitical dimensions that increasingly shape its domestic politics. The conclusion assesses whether EAC membership can serve as an anchor for stabilization or whether domestic fragmentation will ultimately undermine the benefits of regional integration.

2. The Economic Dimension: Modest Growth, Extreme Vulnerability

2.1 Growth Trajectory and IMF Engagement

Somalia’s economic performance in 2025-2026 reflects the profound challenges of post-conflict reconstruction against a backdrop of external shocks. According to the International Monetary Fund, real GDP growth reached a robust 4.1 percent in 2024, but prospects have weakened considerably in 2025-2026 amid significant foreign aid cuts and adverse weather shocks . The IMF projects growth of 3.0 percent in 2025 and 3.3 percent in 2026, with a gradual acceleration to 4.1 percent projected for 2030 .

This growth trajectory, while positive in absolute terms, represents a significant deceleration from the immediate post-pandemic recovery period. The IMF’s October 2025 staff-level agreement on the fourth review under the Extended Credit Facility arrangement enables the release of approximately $30 million, subject to Executive Board approval, with total disbursements expected to reach about $100 million . An additional augmentation of about $40 million has been requested to mitigate the negative impact of foreign aid cuts .

The IMF assessment identifies several binding constraints on growth. Foreign aid disruptions—stemming from both donor fatigue and geopolitical realignments—have created fiscal pressures that directly affect government operations and service delivery. Adverse weather shocks, including severe droughts affecting communities across the country, have undermined agricultural production and exacerbated food insecurity . As one analyst noted in February 2026, over 4.8 million Somalis will require humanitarian assistance, yet resources are frequently diverted by predatory networks .

2.2 Inflation Dynamics and Price Stability

Somalia’s inflation performance presents a mixed picture of stabilization alongside persistent pressures. The headline inflation rate increased to 5.57 percent in December 2025, up from 5.20 percent in November, following a deceleration from 3.90 percent in October . Trading Economics forecasts suggest inflation will trend around 5.70 percent in 2026, with long-term projections holding relatively steady .

This moderate inflation rate represents a remarkable stabilization compared to Somalia’s historical experience. From 1961 to 2024, inflation averaged 11.70 percent, reaching an all-time high of 216.00 percent in December 1990 during the state collapse and a record low of -15.00 percent in December 2010 . The current 5-6 percent range, while elevated by developed economy standards, indicates a functioning monetary environment and reasonable price stability.

However, the composition of inflation reveals structural vulnerabilities. Food inflation, measured separately, stood at 5.30 percent in October 2025, up from 4.80 percent in the previous month . This is particularly significant because food and non-alcoholic beverages account for 46 percent of the Consumer Price Index weight—the largest component by a substantial margin . Housing and utilities comprise an additional 23 percent, meaning that nearly 70 percent of the consumption basket is concentrated in basic necessities .

The divergence between food inflation (5.30 percent) and overall inflation (3.90 percent in October) suggests that non-food prices are experiencing deflationary pressures, potentially reflecting weak aggregate demand outside essential consumption . Food price pressures are likely to remain elevated despite the IMF’s projection of stable overall inflation around 3.5 percent .

2.3 Extreme Import Dependence

The most striking feature of Somalia’s economic structure is its extreme import dependence. By multiple measures, Somalia ranks as the most import-dependent economy in Africa, with imports valued at approximately 99 percent of GDP . This figure, which essentially means the value of goods imported nearly equals the entire economic output of the country, reflects the near-total absence of domestic industrial capacity after decades of conflict.

Food accounts for over 35 percent of total imports, making Somalia acutely vulnerable to global grain price spikes . Refined petroleum and construction materials constitute the other major import categories . This dependence means that global commodity market fluctuations transmit directly to domestic prices, with limited capacity for substitution or domestic production.

The import dependence reflects deeper structural realities. Decades of conflict have hindered the development of a robust industrial base, leaving the country reliant on foreign markets for nearly all essential goods . Limited local processing capacity means that even when raw materials exist—as in the case of livestock, Somalia’s traditional export—value addition occurs abroad .

This structural position creates extreme vulnerability to currency fluctuations and terms-of-trade shocks. Unlike more diversified economies, Somalia lacks the export base to generate foreign exchange sufficient to cover import requirements, creating persistent balance of payments pressures that external assistance only partially addresses.

2.4 Fiscal Position and Reform Efforts

Despite the challenging environment, Somali authorities remain committed to enhancing domestic revenue and maintaining fiscal discipline according to IMF assessments . The preliminary 2026 budget plan envisages continued progress in domestic revenue mobilization and expenditure discipline, while accommodating additional security and election-related spending .

Significantly, the budget plan seeks to expand social spending using domestic resources to mitigate the social impact of reduced foreign aid . With these plans, the overall fiscal deficit in 2026 is projected to be approximately 0.75 percent of GDP—a remarkably small deficit given the scale of challenges and indicating substantial fiscal consolidation efforts .

Key domestic revenue reforms include:

• Customs modernization and enforcement

• Implementation of the new income tax law

• Improved enforcement of sales and income tax collection

Debt and public financial management are also priority areas for capacity building. Authorities are working to implement the newly completed legal framework aimed at ensuring transparency and accountability in the extractive industries—a sector with significant potential for future revenue generation .

2.5 Economic Outlook and Downside Risks

The IMF’s assessment emphasizes that “downside risks continue to dominate the near-term outlook, including protracted foreign aid disruptions and weather shocks, which could further worsen the economic situation” . This cautious assessment reflects the multiple vulnerabilities facing the Somali economy.

Protracted foreign aid disruptions would directly affect government operations and the limited social services the state provides. Weather shocks—both drought and flooding—undermine the agricultural and pastoral livelihoods on which the majority of the population depends. Political instability, as discussed in the following section, compounds these economic vulnerabilities by deterring investment and disrupting economic activity.

The medium-term outlook to 2030, with growth projected at 4.1 percent, assumes gradual stabilization and reform implementation . However, this projection depends critically on political developments that remain highly uncertain.

3. The Political Dimension: Multi-Front Crisis

3.1 Constitutional Crisis and Federal-State Relations

At the heart of Somalia’s political unraveling lies a constitutional crisis born from the provisional nature of the 2012 Provisional Constitution. Designed as a temporary framework, the document’s incomplete chapters on federalism now function as structural fault lines that threaten the coherence of the state .

In February 2026, this crisis reached a physical flashpoint when Puntland President Said Deni and Jubaland President Ahmed Madobe were initially blocked from landing in Mogadishu with their security details—a move by the federal government that signaled a total collapse of confidence between the center and the periphery . While they eventually arrived for talks, the atmosphere remained toxic, with leading Horn of Africa analyst Matt Bryden observing: “When the rules of the game are rewritten unilaterally in the middle of a crisis, the result isn’t a stronger state, but a more divided one. Somalia is currently navigating a path where the center and the periphery are moving in opposite directions” .

The constitutional disagreements center on fundamental questions of power distribution: the division of revenue and resources, the allocation of security responsibilities, and the relationship between federal and state-level institutions. Without resolution of these foundational issues, the federal project lacks the consensus necessary for stable governance.

Against this backdrop of federal-state tension, President Hassan Sheikh Mohamud and Prime Minister Hamza Abdi Barre convened a consultative meeting with the opposition ‘Council for the Future’ in mid-February 2026 . The talks, held at Villa Somalia, represented a major breakthrough in political dialogue between the Federal Government and a prominent section of the opposition, focusing on the general state of the nation and the trajectory of upcoming elections . The dialogue extended beyond immediate political agenda to address pressing humanitarian and security imperatives, including coordinated national responses to severe droughts and the ongoing offensive against Al-Shabaab .

This simultaneous dynamic—confrontation with federal member states alongside dialogue with opposition—illustrates the complex, multi-actor nature of Somali politics, where the government must navigate relationships in multiple directions simultaneously.

3.2 Parliamentary Dysfunction and Legitimacy Vacuum

Inside the capital, the legislative process has similarly stalled. In early February 2026, chaos erupted in the Federal Parliament as opposition MPs physically blocked sessions to protest proposed constitutional amendments they view as an illegal power grab . This parliamentary turmoil reflects a broader lack of confidence that permeates every level of the federal structure.

The parliamentary dysfunction is not merely procedural; it strikes at the heart of governance legitimacy. As the International Crisis Group recently noted, the political standoff in Mogadishu is not merely a delay in governance but a vacuum that Al-Shabaab and external actors are all too eager to fill, threatening the very foundations of the federal project .

With only months remaining before the current federal mandate expires in May 2026, the absence of consensus on electoral mechanisms creates the prospect of a constitutional crisis overlapping with a leadership transition. The combination of disputed rules, contested authority, and divergent interests among political actors raises the possibility of parallel claims to legitimacy or outright breakdown.

3.3 Security Outsourced, Trust Eroded

The threat from Al-Shabaab thrives in these governance vacuums. As of early 2026, the security landscape is particularly precarious due to the transition from the African Union Transition Mission in Somalia (ATMIS) to the African Union Support and Stabilization Mission in Somalia (AUSSOM) .

However, AUSSOM currently faces a critical funding shortfall, with budget gaps threatening its ability to hold territory. A senior African Union diplomat warned in February 2026: “Security cannot be outsourced indefinitely. If the transition to AUSSOM is not met with political reconciliation in Mogadishu, the international community is simply managing a slow-motion collapse” .

The Somali National Army, despite years of international training and support, remains unable to assume full responsibility for national security. Clan dynamics, limited resources, and persistent corruption undermine military effectiveness. Meanwhile, Al-Shabaab continues to control rural areas, conduct urban attacks, and generate revenue through taxation and extortion.

3.4 Corruption as Existential Threat

If insurgency is the symptom, corruption is the disease. Somalia remains at the bottom of the Corruption Perceptions Index, reflecting systemic graft that pervades every level of government and society . This is not merely a financial issue; it is existential.

Over 4.8 million people will require aid in 2026, yet resources are frequently diverted by predatory “gatekeepers” who control access to populations and capture assistance flows . As Transparency International recently highlighted: “In Somalia, corruption is not just a byproduct of instability; it is the primary engine of it, eroding the public trust required for any security strategy to take root” .

The diversion of public resources undermines the state’s legitimacy in the eyes of citizens who see elites enriching themselves while basic services remain absent. It also provides a grievance that Al-Shabaab exploits in its recruitment and propaganda, positioning itself as an alternative to a corrupt system.

3.5 The Somaliland Exception

In stark contrast to the volatility in the south, Somaliland enters 2026 as a beacon of stability and a case study in democratic resilience . Having gained independence from Great Britain on June 26, 1960, it was briefly a sovereign state recognized by over 30 UN members before entering a voluntary but ill-fated union with Italian Somalia . Following a decade-long struggle against the Barre regime, Somaliland reasserted its sovereignty in May 1991.

Unlike the top-down, internationally funded state-building efforts in Mogadishu, Somaliland’s stability was built through bottom-up, clan-based reconciliation . This organic process birthed a unique hybrid of traditional leadership and multi-party democracy. For 35 years, Hargeisa has overseen regular, peaceful transfers of power—a record unmatched in the region.

This democratic maturity reached a new peak on December 26, 2025, when Israel became the first UN member state to formally recognize Somaliland’s sovereignty, breaking a decades-long diplomatic ceiling . Geopolitically, Somaliland has positioned itself as the “mouthpiece” of the Bab al-Mandab Strait. With the Port of Berbera sitting just 260 kilometers from this critical maritime chokepoint, Somaliland is a pivotal node in global trade. More than 12 percent of global trade and 30 percent of container traffic transits these waters annually .

The contrast between Somaliland’s stability and southern Somalia’s fragmentation poses profound questions about the future of the Somali state and the viability of the federal project.

4. Regional Integration and Geopolitical Dimensions

4.1 EAC Membership: Milestones and Meaning

Somalia’s formal accession to the East African Community in March 2024 represented the culmination of a decade-long bid and signaled the country’s strategic orientation toward regional integration . By February 2026, the country achieved a significant operational milestone: authorization to issue East African Community passports.

The handover ceremony in Dar es Salaam saw Somalia’s Ambassador to Tanzania and Permanent Representative to the EAC, Ilyas Ali Hassan, formally deliver the approved EAC passport design features to Interior Minister General Abdullahi Sheikh Ismail “Fartaag” and the Director General of the Immigration and Citizenship Agency . The authorization, effective from December 2025, enables Somalia to begin issuing the regional travel document in three categories—Diplomatic, Service, and Ordinary—joining other member states using the harmonized documentation .

The development represents a key diplomatic milestone and is expected to strengthen regional integration by facilitating the free movement of Somali citizens within East Africa, promoting trade and economic collaboration, and strengthening people-to-people ties across the region . Somalia has already elected nine members of parliament to the East African Legislative Assembly (EALA), who will represent the country at the regional parliament headquartered in Arusha, Tanzania .

This institutional integration proceeds alongside deepening bilateral relationships. The passport authorization coincided with the Governments of Somalia and Tanzania signing a bilateral agreement, further consolidating cooperation between the two nations .

4.2 Geopolitical Proxy Theater: Red Sea Rivalry

Somalia’s strategic location has increasingly turned it into a geopolitical arena where external powers pursue competing interests. The 2024 Memorandum of Understanding between Ethiopia and Somaliland triggered a seismic shift in regional alignments . The agreement, which would grant Ethiopia naval access to the Berbera port in exchange for potential recognition considerations, fundamentally altered the calculus for other external actors.

Mogadishu’s response was swift and multifaceted. The federal government invited an Egyptian military presence—a move that leverages Cairo’s historical tensions with Ethiopia over Nile waters to counter Addis Ababa’s influence. Simultaneously, Somalia entered a defense deal with Turkey, which has become one of the most significant external partners through training programs, development assistance, and now security cooperation .

This “securitization of diplomacy” risks transforming Somalia into a proxy theater where domestic policy is increasingly dictated by external patrons rather than national interests . The convergence of competing external agendas—Ethiopian, Egyptian, Turkish, Emirati, Qatari—creates a complex overlay on domestic political fault lines, with different federal states potentially aligning with different external partners.

4.3 The Integration-Fragmentation Paradox

Somalia’s simultaneous experience of regional integration and domestic fragmentation presents a profound paradox. As the country issues EAC passports and sends representatives to the Arusha parliament, its own federal parliament descends into chaos. As it aligns with regional standards and frameworks, its federal states move in opposite directions from the center.

This paradox raises fundamental questions about whether regional membership can serve as an anchor for stabilization. Theoretically, EAC integration could provide institutional templates, technical assistance, and peer pressure that support domestic reform. Practically, however, regional processes operate at a level removed from the immediate crises of constitutional deadlock, security vacuums, and humanitarian need.

The danger is that regional integration becomes a parallel process disconnected from on-the-ground realities—a diplomatic achievement that coexists with, rather than resolves, domestic dysfunction. As one analyst warned, “the international community is simply managing a slow-motion collapse” while maintaining the appearance of progress through institutional milestones .

4.4 External Actors and Conditional Engagement

International partners face growing dilemmas in their engagement with Somalia. The traditional approach—providing budget support to the federal government while pushing for political reconciliation—has produced limited results. Corruption continues to divert resources, federal-state relations remain adversarial, and security transitions proceed without adequate preparation.

The IMF’s continued engagement through the Extended Credit Facility represents one form of conditional support, with disbursements tied to reform implementation and fiscal discipline . However, the limits of this approach are evident in the warning that “downside risks continue to dominate” and that foreign aid disruptions could further worsen the economic situation .

The African Union’s role in the security transition similarly reflects the challenges of conditional engagement. With AUSSOM facing funding shortfalls and the Somali National Army unable to assume full responsibility, international partners find themselves extending support without clear exit strategies or benchmarks for success .

5. Conclusion: Between Integration and Fragmentation

Somalia’s economic and political status in East Africa embodies the profound tensions of simultaneous integration and fragmentation. Economically, the country demonstrates modest growth and reasonable price stability against a backdrop of extreme structural vulnerability—import dependence at 99 percent of GDP, food comprising nearly half the consumption basket, and aid shocks threatening macroeconomic stability. The IMF’s continued engagement provides a framework for reform, but cannot substitute for the domestic productive capacity that remains absent after decades of conflict.

Politically, Somalia operates on multiple fault lines simultaneously. Constitutional crisis pits federal government against member states. Parliamentary dysfunction creates a legitimacy vacuum. Al-Shabaab exploits governance gaps to sustain its insurgency. Corruption diverts resources from humanitarian needs to predatory networks. And Somaliland’s stable, democratic trajectory offers an alternative model that challenges the federal project’s assumptions.

Regionally, Somalia has achieved meaningful integration milestones—EAC membership, passport authorization, EALA representation—that connect it to East African institutions and frameworks. Yet these achievements coexist with escalating geopolitical competition that threatens to turn Somalia into a proxy theater for external rivalries. The convergence of Ethiopian, Egyptian, Turkish, and Gulf interests creates a complex overlay on domestic divisions.

Several conclusions emerge for understanding Somalia’s status. First, economic recovery remains hostage to political stabilization; without resolution of the constitutional crisis and security challenges, growth projections will remain aspirational. Second, regional integration offers potential benefits but cannot substitute for domestic political consensus; EAC membership is complementary to, not a replacement for, federal-state reconciliation. Third, the Somaliland exception poses fundamental questions about the future of the Somali state that cannot be indefinitely deferred.

For East Africa, Somalia represents both an opportunity and a challenge. As the newest member, it brings strategic depth, maritime access, and cultural diversity to the Community. But it also imports instability, requiring regional partners to manage the spillover effects of its domestic crises. The EAC’s ability to support Somalia’s stabilization—through technical assistance, peer pressure, and collective security frameworks—will test the Community’s relevance to the hardest cases of state fragility.

The path forward requires recognizing that Somalia’s multiple crises are interconnected. Constitutional deadlock undermines security cooperation. Corruption fuels insurgency. Geopolitical competition exacerbates federal-state tensions. External assistance, however well-intentioned, cannot resolve these dynamics without genuine domestic political will. As the International Crisis Group warned, the vacuum created by political standoff is one that Al-Shabaab and external actors are all too eager to fill .

The question facing Somalia and its regional partners is whether the center can hold—whether the federal project can accommodate diversity while maintaining coherence, whether institutions can command legitimacy while delivering services, and whether regional integration can anchor stabilization while respecting sovereignty. The answer will determine not only Somalia’s future but the character of East Africa as a region capable of integrating states at very different stages of development and stability.

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